By Stuart Lauchlan, news and analysis editor
Oracle president Charles Phillips kicked off the two-day Oracle Summit on the social networking evolution of the customer management market with some product sabre rattling. But he also had some interesting insights into the opportunities presented by Web 2.0 in these 'uncertain times'.
The elegant Hotel Lutetia in Paris was once home to senior Gestapo officers during the occupation in World War II. But the guests checking in this week were of a far less sinister nature, in the form of business executives from all around Europe who gathered for a two-day Oracle summit on the social networking evolution of the customer management market.
While CRM and the future development of the market was to be the central theme of the summit, it kicked off with a setting out of the Oracle stall from Oracle president Charles Phillips. This was partly preaching to the converted – the attendees were existing Oracle customers – but the company has expanded so rapidly through acquisitions that such scene setting is now practically de rigeur in order to keep up with the latest additions to the portfolio.
“We are certainly the largest enterprise software company overall,” said Phillips. “We have three basic businesses – databases, middleware and applications. We've grown a lot. We have over 3,000 products. We are not the same company we were when we only had a database. We continue to grow in that market. We now have more market share than IBM and Microsoft combined according to Gartner. We are now number one in middleware following the BEA takeover. The third business is applications. We continue to expand here, not just in back office. We go well beyond ERP. If you think about applications from enterprise vendors you think about ERP and CRM. But we also have line of business applications that drive revenue. That brings us closer to customers.”
More is less, argued Phillips, telling the audience that the more Oracle software that they use, the more benefit they will realise. “You start to reduce complexity. You can remove duplication. You don't want each application to have its own security, for example, there should be one central security point,” he said. “To have all these things designed by different companies, makes a lot of work for you or have you hire a bunch of consultants. We do that for you. The more Oracle products you use the more you share infrastructure, the more one plus one makes three.”
Phillips also pledged that Oracle would remain emphatically enterprise-focused. “We're not going to get distracted and go off to chase the consumer market or go after internet companies or sell X-Boxes,” he said. “All our acquisitions have been in the enterprise space. We are going to stay focused. We will spend $3 billion in development this year, regardless of any acquisitions. Acquisitions are a way to supplement innovation. If there is something interesting or innovative in another company in the enterprise space, we probably know about it. Companies come to tell us about it because they want to be bought by Oracle.”
The changing nature of customer engagement
With the software stack lined up, Phillips moved on to discuss the changing nature of customer engagement and management. “These are uncertain times and in uncertain times you need to have more certain opportunities,” he said. “The timing of this conference is perfect. It's the perfect time to be closer to your customers and to have more complete, accurate and timely information about your customers. It's a great time to understand them more and get an edge over your competition.”
These new imperatives map onto Oracle's software stack, he added. “Everything we do builds on something we've done in the past,” he said. “You need to collect information on customers in a more efficient way. You need to analyse the information better. Thirdly, customers are interacting in a different way. They are going to have conversations. You can ignore that or you can take advantage of the growing network of customers who are having conversations about you.
“You need a multichannel architecture that pulls in information from multiple sources. We can give you a single view of the customer. In the past we had fragmented customer information across channels. The data in CRM 2.0 is much richer. People spend more time online and are willing to give you more data than before. The trick is what you do with that data and how you analyse it.
“Within Oracle, I have a dashboard where I can see things like the global pipeline. That's just the metrics. But what kind of things do you need to analyse. If you collect enough customer data, you can see trends. We can get to some sophisticated analytics. If you tell me the product, the size of the deal and your industry, I can tell you the sequence of events that lead up to a transaction. We have an analytics group that looks at this information on a constant basis.
"Once we know who the customer is, we can look at past purchasing. We can look at who you are and what you have installed and we can predict what you'll buy next within four products. We have that level of sophistication now that we didn't have five years ago. We know the customers. We won't waste money trying to get you to look at things you don't want to buy. We can be more productive and get more out of what you are spending. You give customers information that they care about.
“Then you want to take advantage of new channels. Customers want to engage with customers. They want to participate in the conversation. There are consumer networks. Productivity networks in business to business, such as the Oracle Technology Network. Then there are customer networks where people talk about experience of our products. Is it all good? No, but I want to know if there are things in there that I don't like. Our willingness to engage and respond brings us closer to customers. Last month we took down a website and asked them to enter their idea for Oracle. It was an overwhelming success. If you didn't want to do it, you could skip to the regular website. It demonstrated that in all communication forms, customers want to participate, they don't want one way communications.”
