The Zen of Oracle ERP
Oracle Applications is an enterprise wide business process enabling software.
This software comprises more than 30 modules which when deployed provides the
information technology infrastructure necessary to run an enterprise. A typical Oracle
Applications software has some enterprise specific customization when deployed. The
application software system is expected to fulfill the multi-dimensional requirement of
functionality, customizability, reliability and performance. Installation, customization
and deployment of Oracle applications is by no means a trivial task. This paper will
provide a generic framework to accomplish the deployment of Oracle Applications.
Objectives of an Oracle Applications Implementation:
At a very high level, the objectives of an Oracle Applications implementation can
be stated as follows:
1. Install the Oracle Applications suite with all the desired modules to be implemented.
2. Maximize the use of available functionality within the application by modifying
business process whenever efficient.
3. Customize the Oracle Application suite for business processes that cannot be
modified keeping in mind that customizations impact the ability to upgrade and
support by the vendor.
4. Deploy the applications and be able to meet business, performance and operational
The following steps suggested should reduce the risk of implementing Oracle
Applications to a great extent.
ERP Implementations and Consulting Firms:
ERP (Enterprise Resource Planning) Implementations have tremendous impact on
the way companies do business and compete. So it is a standard practice to bring in
consulting/accounting firms to advise on implementing ERP. Almost every major IT
Consulting firm has an ERP Implementation division. These firms provide a high level
of functional and technical expertise needed to deploy ERP solutions. Oracle Consulting
is a premier provider of such services and so are some major accounting firms. ERP
Implementations are treated as projects and implemented as such. Typically a Program
Office is setup which is comprised of management from accounting, IT and the
consulting firm and this office is responsible for the success of the ERP system.
Identifying the Oracle Applications Manager:
The Oracle suite of Applications needs to be administered and managed by
a highly competent person who has experience implementing ERP solutions. This person
would have extensive knowledge of Operating Systems, Oracle RDBMS’s and Oracle
Application Administration expertise. This person would be a hybrid of a Operating
System Administrator, Oracle DBA and Applications System Operation expert. This is a
very important role and could be done by a team which works in close cooperation. Most
often this person would be required to be proficient in General Ledger(GL) because the
GL is the core of the Oracle Applications suite and a correct setup of this application is
critical for success of the applications. Setup of other applications like Accounts
Receivables (AR) and Accounts Payables (AP) depend on this application too. Note that
this role is totally different from the Project manager. This team should be involved in
the decision making process of the implementation. A representative from this group
should be a part of the Program office which manages the ERP Implementation effort.
The Oracle Applications Implementation Methodology referred to as AIM
is a sophisticated Applications Implementation tool with a lot of guidelines. AIM
provides a framework for efficiently planning, conducting and managing an Applications
Implementation project. Oracle’s Application Implementation Method is a proven
approach for implementing packaged applications.
Since Application implementation projects are mission critical, it becomes
imperative that a methodology be chosen. Ad-hoc development will only lead to failures
and disappointments. AIM provides templates, guidelines, definitions, processes and
their associated tasks, resource needs to conduct an Application implementation project.
The fundamental issues is one has to select a methodology and stick to it for conducting a
mission critical effort such as an application implementation.
Business Processes and Mapping to Application Modules:
We had already mentioned before that ERP applications enable and
improve business processes. So one of the first tasks is to identify business processes and
application modules and see whether the modules implement these processes.
Historically organizations have been reluctant to change business processes and they are
stuck with applications that have outlived their usefulness.
Business Process re-engineering works two ways. One is the actual
improvement of the business process itself and the other is the modification of the
process to fit the application process flow. Organizations embrace the former for obvious
reasons, but there is a reluctance to do the latter. Actually doing the latter might reap
more benefits because of enhanced automation with just the cost of the applications rather
than expensive customizations which have disadvantages listed in this document.
Big Bang Approach Versus Phased Approach:
Big bang implementations offer many benefits such as enhanced
automation and features. Oracle Applications is a big bang product with all its modules
and its tight integration. It may seem intuitive that big bang products could be
implemented in a big bang fashion. The issue is that the complexity becomes a product
of the complexity of all the customization of the modules in the application. It should be
observed that the Oracle Applications assumes a hypothetical enterprise with a generic
business model. Most often, enterprises fit in the model. Whenever, there is a
discrepancy customization is done.
Some Application vendors suggest that the specific enterprise model be
modified to fit the generic model. By doing this, few customizations need to be done and
implementation of the applications reduces to an install of the applications. In fact, some
enterprises have taken this approach due to the geometric costs of implementation of all
the modules of the application.
Another widely used model is to implement modules in phases. The first
modules to go live are typically General Ledger, Accounts Payable and Accounts
Receivable, because fundamentally all companies unlike individuals are required to keep
track of paying, receiving and keeping books of transactions. A major disadvantage of
this approach is that one has to write data interfaces from other applications which have
yet to be implemented. The big bang obviates this requirement.
Big Bang application implementation efforts should flow from the top
management and should just not be an IT initiative. There must be unconditional support
from the business process owners of the various processes and a commitment made to
improve business processes by implementing the applications module. It might be even
worthwhile to conduct BPR studies on business processes and establish the business and
cost benefits of such application efforts. For example, a payables department could
lower its operating costs by making payable schedules for vendors accessible by Internet
and hence reduce manpower used for taking calls and accessing the information.
Selection of the Oracle Applications Release:
The first step in the Oracle Applications process is to select a version of
the applications. There are four major components to this.
1. Hardware Platform.
2. Supported Operating System for the Hardware Platform.
3. Supported Oracle RDBMS release for the Operating System.
4. Supported Oracle Applications release for the Oracle RDBMS.
This is referred to as the certified combination release of the Oracle
applications. It is very important that a certified combination be chosen at the earliest.
This in turn leads to the first problem of choosing a hardware platform. It is a major risk
to run an uncertified combination due to obvious reasons like lack of support for such
implementations. This is by far the simplest and most important step in the application
implementation process. The importance of the DEMO database in the selection of the
applications release is documented in another section. It is very important that a release
of the applications be picked at the earliest and stick with it for the duration of the
Choosing a Hardware Platform:
Typically, Organizations have preferred vendors. The first step is to verify
whether these vendors have the latest release of Oracle and its Applications (i.e. a
certified combination) ported to their Operating System. The next step is to identify
whether such a hardware resource will be able to meet the demands of the applications
and its usage. This is where a initial capacity planning study will be very valuable. At
this point, it is hoped that a decision has been made on the modules to be implemented.
Since these modules are already around in various forms like Mainframe applications,
custom applications a lot of useful information can be gained from these system like
volumetrics, number of users and expected response time. This will be the input for the
initial capacity study.
By far the most critical factor in selecting the hardware platform is the
scalability of the CPU’s in the hardware. Oracle Applications can be characterized into
two types of usage - batch and OLTP. The batch usage is CPU bound in that it uses a lot
of CPU time. The OLTP is less CPU intensive. The number of CPU’s determine
scalability. But merely adding CPU’s to a hardware configuration doesn’t necessarily
buy scalability. The sophistication of the Operating System is another factor for
determining that. It can be observed that in a typical hardware platform, after a certain
number of CPU’s the performance does not improve at all. A good way to do this is to
characterize the expected workload and volumes and ask vendors to furnish reference
sites which support it. Major hardware vendor sales are centered around such application
servers and this will be a good starting point.
Oracle Consulting Services provides performance planning services and it is
strongly recommended that these services be used in the initial phase of the project to do
capacity and architecture planning
Installation of the Oracle Applications:
The Oracle Applications suite is a massive piece of software. It is strongly
recommended that Oracle’s consulting services be requested to install this software the
first time. Installation of the Applications requires versatile expertise in UNIX or the
Underlying O/S, Oracle and DBA activities. The installation of the software is an
intellectual exercise and should be learnt by one of the site personnel for future installs.
The typical installation takes a couple of days depending on the Operating System, Oracle
RDBMS and the Applications release. The installation process consists of installing the
software and applying the patches to complete the installation.
Availability of Oracle Applications Demo Database:
The Oracle Applications bundle consists of a Global demo database and a
couple of other demo databases. The demo database is basically an Applications database
representing a small sample set of data for a hypothetical enterprise. This database is
very important for set-up activities, and doing basic proof of concepts.
In fact, one of the first step in Applications implementation is setting up
two copies of the database along with the applications. One copy of the demo database
and the applications is for the applications lookup, setup work and for base functionality
reference. The other copy of the applications and the demo database could be used as a
starting point for application development. In fact, one of the factors for choosing a
version of the Applications is the availability of the demo database. The demo database
is typically available with all versions of the applications, but in new versions and
releases might lag the availability of a release or a version by a couple of months. It is
strongly recommended that the demo database be used as a starting point for all
Since Oracle Applications enable better business processes, these
processes already exist in some form around the enterprise, typically a mainframe
application, custom application or even another application vendor software. Most often
than not, these systems become the data source for the new application software.
Sometime the source for the existing applications should be identified as well so that
those original data sources could be directly fed into Oracle Applications.
By far one of the most intensive efforts in Applications implementation is
data conversion and its associated tasks. This process is the most important process in
the applications implementation process. A variety of templates exist in the AIM
methodology which will enable better data conversion procedures. A significant amount
of effort should be involved in automating the data conversion procedures as these
conversion processes might be a critical path for enabling various business processes.
Strap-on, Strap off Customization concept:
As mentioned before, the Oracle Applications suite is typically
customized for enterprises. These customizations should be done in such a way that a
script applies the customization and there is also a script which undoes the customization.
The reason for this is that the upgrades are designed for the base release of the
Applications and not for the enterprise specific customizations. This concept has the
advantage that a well documented strap-off, strap-on code will give the enterprise an idea
of the effort and the steps which were taken to do the customizations. Most often than
not, customizations are done in an ad-hoc fashion and at the end of the implementation,
the upgrade path for the applications is pretty much out of the question. This creates a lot
of problems because Application versions typically run out of support agreements after a
period of time and the customer is left with an unsupported combination. New Versions
of the applications enable new technologies and functionality’s and this advantage is lost
by not having such a script.
However, this is easier said than done. This is because sometimes user
requirements may require significant customizations that it might not be possible to do
this task. At this point, the user should be made aware of the risk of significant
customization which comes with a cost.
About the Author:
Mahesh Vallampati is a senior consultant with the Oracle National
Telecom Practice. He has 4 years experience implementing Oracle Databases and 2 years
implementing Oracle Applications. He holds a Master’s degree in Electrical Engineering
from Texas A&M University.