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Oracle Fusion Applications Webinar

Oracle Fusion Applications Overview, December 13, 2010

Presenter: SVP Steve Miranda

MR. STEVE MIRANDA: Hello everyone, my name is Steve Miranda and today I'll be going through the overview of the Oracle Fusion Applications. What I plan to cover is actually four different aspects.

First of all, to make that you are clear on Oracle's overall application strategy. Next, within the context of that strategy, what are the Fusion Applications and what do we define them to be? Then I'm going to give this in the context of Oracle's commitment to Applications Unlimited, and then finally talk about the path to Fusion, or rather really what are our recommended actions for the Fusion Applications, or really all our Application customers as a whole.

What I'm going to start off with is why do we build Fusion Applications? What's a common misnomer is that we build Fusion Applications to replace an existing Application or to force our customers down from one application to the next. Really that is not the reason why you build the Fusion Applications.

So if you have that mindset you're going to start asking a lot of questions that don't really make a lot of sense in terms of our commitment to Applications Unlimited and support timelines. Frankly it may not make sense in the context of what you should do going forward to consume or not to consume Fusion Applications.

Before we get started on exactly what they are I thought I would define whey we build the Fusion Applications. Now very specifically we see an inflection point happening in the Oracle overall application marketplace, and we've seen these types of inflection points in the past. I'll cover a couple and I'll cover what we've seen now and what defines that inflection point and how we think it'll be different from inflection points we've seen in the past.

First and foremost this is nothing new in the applications space. We've seen changes where the application marketplace has gone from mainframe computing over to what were UNIX systems or minicomputer timeframe which is basically driven

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by character mode applications. That's really when Oracle and SAP and J.D. Edwards and others got into the business of applications.

Next from there we saw obviously a client server phase of PeopleSoft, Siebel really got into the business with applications at that point along with a number of other vendors and some vendors really came on board and other vendors chose not to and became legacy applications either from the mainframe or in the character mode application world.

Client server really blended into an internet-deployed application where we stopped installing software on desktops and move applications over to the internet and then from there now we moved forward and there's really a couple key definitions of what we see driving this next inflection point of applications.

The first is the application platform itself. So we believe that the next generation applications will be based on standards, open standards top to bottom so no longer will you need company proprietary tools or languages such as ABAP to build the application and build the application platform. There's a standard application platform and a standard set of standards that are really industry-wide, things like Java and XML and HTML and BPEL for business process management and really building your applications.

And in the context of this we think the applications going forward will be SOA, or service oriented applications not with just web service added as an afterthought but really ground up service oriented applications from the build and design and thought process.

Next is going forward we've really seen the customer user experience be much more at the forefront and internet use and internet adoption has really taken a number of different flavors from people using the applications for everything from Amazon.com to Facebook and Twitter. We really felt a modern user interface, web tool user interface and contemporary user interface is what's necessary in the context of business applications.

Then if you look at the first generation of ERP applications particularly very focused on process automation and they're really where transactional-based applications. And with

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Fusion Applications and this inflection point everything needs to be business intelligence driven and much more business intelligence applications not just transactional applications.

And then finally the adoption paradigm is key where not only are customers looking to have applications hosted potentially as a BPO model or hosted as a cloud or in SAS but also modular in that you can consume the applications, really the ones that you see as critical to your business but not do big bang applications.

This is one key business difference from other inflection points that I've seen in the past or that the industry's seen in the past where in the past many companies were not only going through the technology evolution from mainframe to open systems and minis but also simultaneously going through either a Y2K platform or M&A-based platform or internet or globalizing-based platform or moving to shared services but some kind of broad, business-transformation so that what many of our customers were asking for were basically in making broad-based, platform-based decisions and doing lots of big bang implementations. Whereas today we're hearing really just the opposite from our customers today.

Instead the customers are asking us not for a big bang implementation but to keep their core business stable and really drive down the cost of operating that core business but at the same time innovating and giving them ways to adopt new and more flexible technology and better capabilities in point areas. And sometimes that's in the cloud or offered by us by SAS and sometimes that on premise and just offered in a coexistence fashion with their existing investments.

So really the reason why we're building the Fusion Applications why we've built the Fusion Applications is to drive customer value in one of these three different areas, in standard-based applications or embedded intelligence driving the business user interface or giving the customers choice and flexibility in terms of technology adoption be that measured in SAS or in terms of modular deployments.

With that as a background let me give it a little bit more definition on what the Fusion Applications actually are. So first off as I mentioned before one of the key driving tenets is the Fusion Applications are a complete standard-based

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modern platform all based on Oracle's industry-leading Fusion middleware.

So it is completely rewritten from the ground up in terms of Java interfaces using HTML, XML, BPEL for the business process design all industry standard non-proprietary tools for the application build themselves.

We did it in business process flow based design of the applications and by that we're able to leverage the countless hours we've spent with our customers from E-Business Suite to PeopleSoft, - - Seibel and talking about not only what were the best in class business processes today but also how the business has changed and the businesses processes have changed from our first design of product to really the industry's first design of product to make sure we've brought the best practices and go forward learning for a business process-based design application.

The user interface for Fusion Applications is completely reinvented, a role-based model with at its heart embedded decision support. So every screen within Fusion Applications contains information to keep it not just a transactional application but really a BI transaction application or a business intelligence-driven application.

Then all keeping with the web tool are modern form of having pervasive collaboration, anything from setting up groups in group spaces to having those groups being able to collaborate with each other very seamlessly and easily. And then all of the Fusion Applications are deployable either in a public, a cloud, a private cloud, SAS model or on premise in its traditional software deployment model.

Then a big gratitude of thanks goes to all of Oracle's customers and partners because really the Fusion Applications and with those driving tenets were built and designed in close collaboration with all of our customers to make sure we were hitting the mark on where the business pain points are and where Oracle could bring business benefit with the Fusion Applications.

Now to further define them we're going to talk about really three areas: the new standard for innovation so giving you a feeling for what the importance of the platform and the standards-based and service-oriented architecture brings from a business standpoint, the new standard from work a bit more

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description of our user interface and collaboration of business intelligence. And then finally the new standard for adoption which will get into a little bit more detail on the both offerings in SAS as well as on premise as well as on some of the modular deployment of the Fusion Application.

To start with let me go to the new standard for innovation and talk about some of the technology platform and some of the businesses advantages they bring.

First when we talk about the platform let me give you a brief description of how the applications were built starting from the top down. As I mentioned previously with the user experience every user screen, every UI was built with a role-based model so there was a role in mind whether that be someone from accounts payable or general ledger or controller, a manager in a system, a sales manager, an order manager, a warehouse manager. There's kind of a role-based system. And each of their user experience, each of their UIs and flows was to keep the business intelligence as the heart which was designed with the questions what do I need to know and what do I need to do in mind as well as with the collaborative questions of who do I need to reach to find out information and how do I get a hold of that person basically how do I get my job done?

And so not only are they transactional UI that you've seen in the past but really business intelligence embedded throughout the transactional UIs to make it easier for the customer to know what to do and really to do their job effectively and see the value of the business application.

Next what we did is again business process driven application design so we really took the business process flows from PeopleSoft, Seibel, J.D. Edwards, E-Business Suite, really all of our products and interviews with our customers on where things are going but build in those modern business intel, modern business process driven application throughout.

Now technically this business process is modeled in BPEL by the business process execution language which is the standard-based application language for the workflow definition giving customers and unprecedented ability to more easily configure their business process flows but also to adapt those business process flows in way that keep their applications configured rather than customized in ways we

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never could never do before by capturing much more data and metadata and allowing the customers to do much more of that rather than invasive coding.

Now each of those business processes then underneath each discrete step is composed of a set of web services and once again these are standard-based Java web services that are used not only with our own user interface but also expose the customers to continue to give more flexibility not only in adoption but in modification, and again using only the most modern and open standards for build.

And then underneath all of it is keeping with our tradition of kind of having a rich and robust and complete data model. So spanning CRM to supply chain, finance and back office and procurement, projects also to the HR, having one single and common definition for customers, suppliers, employees, items, orders really across the board, across the whole business flow one single unified data model, unified information system which really facilitates the best in class reporting that appears throughout the Fusion Transactional Applications as well as the Fusion Business Intelligence Application.

Now I'd mentioned a couple times based on standards and I'll give you some flavors from the Java on the front end, the BPEL for the business process execution, the HTML and a lot of the rendering and a number of more that I haven't covered.

Now the importance of standards I want to make one point very clear is not just technical discussion it is actually more important the importance of standard - - business discussion and that we feel strongly about your lowest cost, lowest risk platform over time is a standard-based application set because as these shifts that you've gone through and you define a legacy application over a modern application one of the things that characterize a legacy application are that you have a small and diminishing set of personnel who have the skillsets necessary to maintain, to extend, to patch and to integrate your existing application system.

And really any application that's built on a customer proprietary set of technologies doesn't have the ecosystem of either personnel skilled and staff to maintain, to extend, to integrate but also when you look to buy a third party application so some things that Oracle doesn’t supply the chances that are built on Java in HTML, in XML and that they

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use BPELs is much more highly likely than some things based on Oracle proprietary or an ABAP or a third party proprietary set of technologies.

So our view - the importance of standards across the board is really what a business, business cost and business risk by moving to standards you now have a Fusion Application 100% built in Java allowing you to source the application or the maintenance of the application really from anybody who's been trained in computer science at any university around the world. It is just a Java program, nothing proprietary about the Java we write from other Java programs that are existent, nothing proprietary that would preclude us from integrating easily with a third party system, again with a chance are much likely it's built in the Java program than company or proprietary language or platform.

So now let me spend a little bit of time talking about the new standard for work or our user experience. Now to start let me cover a little bit of how we went through the process. And we really this is where we took advantage of the large Oracle ecosystem where it involved a number of different really thousands of customers and thousands and tens of thousands of hours going through a number of different tests in our usability lab, anything from bringing the customer in, showing them application, actually giving them tests so asking the customer to complete certain actions and tasks within the application themselves, recording those results and then optimizing those results based on actual quantitative feedback that the customer had and gave us by using the product both in assisted testing where you kind of test really heads down data entry, kind of full-time users went from simple training, simple guidance and also unassisted training where you really sit down someone whose Java - - application once a month or once a quarter or once a year to really zero train, sit down, ask them to complete some task and by measuring now only their effectiveness in completing those tasks but measuring exactly which user experience patterns work, which were easily discoverable, which we could leverage by having a common platform or internet applications going forward to really make a best in class and what we feel is the most productive user experience total not only in kind of the old style metrics of clicks and so forth but really think time, process time, ease of

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learning, ease of efficiency of using application going forward, really a highly-productive user interface.

Now with this as I mentioned right from the outset we thought that business intelligence was important and so when you look at our applications you're going to see business intelligence and collaboration sprinkled throughout right from the beginning in the menuing system not waiting to have any very reactive system where you have to go in and query and try to find the information you're interested in but with dashboards and key performance metrics and indicators that alert the customer, our customer, the user proactively "what do I need to know?", information embedded whether it's in the form of charts or reports or key performance indicators in the transaction themselves so that before the business user tries to make a decision or make an approval or route a transaction they have the relevant business intelligent information at their fingertips in the same screen, not in a different BI system but really in the same screen in the flow in a just in time methodology of business information the answer to what do I need to know? How do I get it done? Showing them and exposing them to the business process which again is built in BPEL so it's easily configurable from the business user perspective, not having to go to IT to make them changes to basic business processes.

Then with collaboration throughout: who do I need to reach? how do I reach them? What's the most effective way to get a hold of them? Embedded presence built in, email capabilities, obviously phone for voiceover peak capabilities and then the set of social network capabilities but really business social network to allow customers to collaborate on things like projects or sales deals they're working on or having an HR team have a shared collaboration space with Wiki services and group spaces to kind of share information not just on what's happening external or kind of traditional social media but really in the context of the business to make them do their job better and easily and more effectively by communicating better with one another.

As I've said each user interface not only designed for the user but really users in a multitude of roles whether you're in alignment business role like someone in accounting or finance or a manager role as part of your job--you may be a controller which gives you really two distinct roles, one managing finance and the other managing your individual team

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and personnel. And each user interface and dashboard geared to a particular role that not only the individual plays but that they're playing at the time that they use the applications.

One example of the collaboration I talked about is something we call contextual actions. So just as an example everywhere there's a person within the Fusion Applications you see a little pop up like the one that's displayed here in the user interface. And the pop up allows you for that individual to have complete collaboration, complete contextual actions, everything from dialing the voiceover IP so you can call the person in the context of your transaction to having presence availability so you can chat via whatever chat clients you use, of course email or schedule an appointment with them by calendar integration.

Each of those integrations, again, not driven by Oracle proprietary or Oracle tools but rather by open standards regardless of which voiceover IP client you use or which chat client or which scheduler or email, what background or program you use, each of which can be support by the Fusion Applications to give you rich, contextual actions in this case not only what do I need to know but what do I need to do but also who do I need to reach and how can I best and most effectively reach them in the context of my existing transaction and within the context of my application that I'm using.

Now finally let me go for the new standard of adoption, giving you some methods not only from the SAS and on premise but also from the modularity standpoint that I talked about before.

First off and to reiterate, all of the Fusion Applications are not only offered on premise in the traditional fashion but also in a public cloud hosted by Oracle as a SAS offering or potentially hosted by some of our business partners who offer business process outsourcing or BPO solutions.

In addition and using the exact same methodology some customers choose to do it private cloud, so essentially on behalf of different lines of business host as a SAS offering or perhaps as a business process, BPO offering in a private cloud Fusion Application.

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And then really where we see most of our customers, most of our customer or really all of our customers have some on-premise software but most companies are now looking to explore the cloud or a SAS offering in some places Fusion Applications being the same code line for both on premise and in SAS really allows us to have unique position, I mean only vendor support a hybrid implementation of both on premise or SAS or cloud offerings.

Now when I talk about the next section as far as modularity realize that there's many examples of modularity because fusion V1 is a complete set of applications from financials to human capital, supply chain, projects and portfolio management, procurement, CRM and GRC. Really over 100 different, distinct individual modules for our customers to choose and deploy.

Now while a customer can choose to deploy those within, as an entire suite again the vast majority of our customers are not really looking for big bang implementation. So instead they're looking for - keep my core stable and where can I innovate, where can I get some business advantages by taking advantage of some of the things that Fusion Applications brings me whether it's the user interface, the embedded business intelligence, the technology component, some key driver for that.

And within the context of all these applications customers are adopting Fusion side by side or in a coexistence fashion with their existing investments.

So let me lay out what the customer scenarios are and what we're seeing is most common. So for its reading from left to right in a lot of cases the existing customers really have no plans to adopt Fusion at this time. And as I'll detail in a moment with our Application Unlimited policy they continue to see business value and continue to see great benefits and are upgrading to our latest releases based on investments we are making to the Application Unlimited portfolio, meaning upgrades to E-Business Suite, to PeopleSoft to Seibel or to J.D. Edwards.

Now there are some customers who are looking at Fusion Applications and see great business benefit whether it's to adopt it in a FAS fashion, adopt it because of the technology or the increased, you know, business process, changeability

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or configuration ability whether it's to improve user interface or the embedded business intelligence. But some key business driver. And choosing to adopt that Fusion Application in a side by side fashion either through tight interoperability or some loose interoperability or in fact no interoperability at all where you have really distinct installation of the applications themselves to get a particular business benefit while keeping your core stable so meaning not upgrading PeopleSoft or Seibel or J.D. Edwards or E-Business Suite.

And that's really where the bulk of our customer base is today and where we expect them to be quite for some time.

Then you have finally some customers who are either replacing third party applications or in fact replacing existing Oracle applications in a pillar or in fact the entire suite because of the breadth of the Fusion Applications will support, if you will, this wholesale or big bang approach to the Fusion Application adoption.

So the most common modules we're seeing these with are listed here on the left and let me just describe a couple to give you a context and then at the end I will describe a number of distinct user examples of what our first customers are doing.

So first and foremost on top very popular offering is our Talent Management solution. One of the things that many of our customers are asking for is that they keep the core HR Benefits Payroll, be it on PeopleSoft, J.D. Edwards or E-Business Suite very stable and not really looking to do much there. They are interested in upgrades, they are interested in expanded functionality so 9.1 of PeopleSoft or 12.1 of E-Business Suite is very interesting to them.

However many customers are looking for fast to deploy talent management solutions in a number of different areas on talent. For that the Fusion capability to be offered as a SAS platform and really allowing customers to get started very quickly is something that customers are active in looking to do. And so some of our very first customers are running Fusion Applications Talent Management in a SAS offering and integrating that back with Oracle's HR to HR integration to their existing PeopleSoft or E-Business Suite HR solution.

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Another example that's quite popular is Distributed order orchestration, and Distributed Order Orchestration it's really an order hub. So you can think of it as this is where the service-oriented architecture comes into play, a set of services that allows customers to connect a variety of different order capture systems with a variety of different order fulfillment systems.

In order words really breaking down this one to one relationship that's traditionally existed between order capture and order fulfillment, allowing to do inventory management, global order promising and really order optimization throughout the order cycle.

Once again customers are choosing to deploy distributed order orchestration really alongside the order capture systems be it Seibel or PeopleSoft, E-Business Suite and integrating it to their order fulfillment systems, again being the E-Business Suite, J.D. Edwards, PeopleSoft and in some cases FAP on the order fulfillment side going forward.

Another case of a business value being addressed by one of the key driving tenets of Fusion Applications but existing in a coexistence fashion with other modules from the existing investment that our customers have.

In the finance or back office area the accounting hub has been one popular option where we really have a new integration between GL and Hyperion to eliminate some of the data movement that happened in the past that customers have to manage, eliminate a set of timing issues related to that and really give improved visibility in reporting throughout the close cycle.

So a number of customers are choosing to keep their sub-ledgers in place while implementing Fusion at the general ledger Hyperion level or the Fusion accounting hub to really drive the value of that business reporting tight integration while keeping their sub-ledger stable and again deploying Fusion in a coexistence fashion.

Then the final example I'll go through is in CRM on the sales performance management. So once again in terms of the theme that we're hearing from the customers: "Keep my core stable but add business value," a lot of the improved user interface, the SAS deployment and the embedded business intelligence along with base new functionality we provide in

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territory management, quota management and incentive compensation many customers are choosing to deploy the CRM applications in Fusion side by side really to augment their existing Siebel application install that allows them to get value add while keeping their core stable and adding new applications where they have the business need.

So now the common question I get is with the introduction of Fusion Applications we've had Application Unlimited for quite some time and really what is Oracle's commitment to Applications Unlimited.

Well what should be apparent are a couple things. First off over the last really five to six years since the Application Unlimited process and program has been put in place we really delivered on our commitment to customers by not only having new releases of each individual product line from PeopleSoft to J.D. Edwards including J.D. Edwards World, Siebel both on premise CRM as well as on demand. But if anything just continued to increase that commitment and continued to increase the speed of new releases and new innovations throughout the product stack so that if you're any given customer really gets tremendous value by their partnership and investment in and with Oracle applications.

From this though, and as I described this change that we're seeing it's become pretty apparent that what we're seeing is some customers who are moving to Fusion Applications really still rely on their PeopleSoft or Hyperion of J.D. Edwards or E-Business Suite implementation. So you'll notice going forward and in fact in an open world when we talked about Fusion Applications really launched Fusion we really redoubled our efforts to making sure customers were clear on that beyond E-Business Suite 12.1.3 there's an ongoing release and detailed all of the investments coming from E-Business Suite, investments going forward for J.D. Edwards, investments going forward for Siebel, investments going forward for PeopleSoft, every single one of our product lines continue that investment so that as customers see business value they can adopt Fusion they can adopt it in a side by side or coexistence fashion knowing that it's neither of two extremes, it's not a forced march, it's not a forced upgrade to Fusion Applications, the customers will move when they have the business value and when they see the return on investment for the move to Fusion Applications.

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So it's not a forced march by any means and no date with the continued ongoing investment in the existing products but also knowing that there is a path forward. So knowing that as SAS becomes important to a customer or if a server-oriented application becomes critical or if a standard-based application becomes a critical item in terms of cost and risk or as business intelligence really embedded throughout the modern business interface or collaboration becomes critical that there's a path forward for each of our customers on a customer base in a modular fashion so they can best balance their return on investments and risk while still moving forward into new spaces where Oracle can bring value in the applications investment.

So really our strategic approach is while in the past you've seen things in Oracle applications or Oracle Applications Unlimited include E-Business Suite and PeopleSoft and Siebel and J.D. Edwards, Hyperion, Agile amongst a number of others now you can really add Fusion Applications to that portfolio all of which based on the complete and integrative set of Oracle Fusion middleware all of which adding value to our customers and giving our customers complete choice and complete flexibility to best address the customer's need on a go-forward basis.

Then once a customer understands, "Okay, we've talked about why we built the Fusion Applications," I gave you a little bit of flavor of what they are in particular, where they may be business value, and then I talked about what it means to Applications Unlimited, meaning just really reinforcing that the Applications Unlimited continues to go forward the next question customers ask is so what is the path to Fusion Applications or really what should I do next?

The way this is most commonly expressed is really in one of the following questions. So do I want to upgrade to E-Business Suite or do I upgrade to PeopleSoft or Siebel or J.D. Edwards? Do I want to look at extended support windows, if Fusion V1 right for me, do I want to become an early adopter and move into on premise or SAS or am I going to stay in a traditional model?

Here's our advice to customers that we've been giving out for quite some time and I get into what the advice is and I'll get into a bit more background into the “what’s” and the “why’s”.

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So first off we feel we've made a tremendous investment in not only the new releases of E-Business Suite, PeopleSoft, J.D. Edwards and Siebel but also give customers a clear path forward if Fusion is in fact in their future. And so recommended path number one is to upgrade the existing current release of your application portfolio, whether that means E-Business Suite 12.1 or PeopleSoft 9.1 but really to get current, to get the business value of the investments that Oracle's made together with our customers.

Next is to identify an area where you may have a pain point or where some of the things I talked about where Fusion may bring value whether it's a standard-based application that serves oriented application, the embedded business intelligence of the UI or the SAS enablement or the SAS hosting capabilities. And really look to see can you adopt that Fusion Application in a coexistence fashion where you keep your core stable and continue to work with Oracle through upgrade and drive down the cost of operating and making it richer and richer functionally but then having it exist side by side to a Fusion Application where you can coexist and have the best of both worlds: a value add with your pain point and really driving down cost where you need the stability.

Then of course for some of the customers if you're new or you're looking to deploy a broad set of applications you may choose to embrace Fusion Applications as a completely suite. But for the most part our advice to customers is on step one and step two. Step one: continue down the current path through the latest upgrade and then step two: see how you can supplement that offering with a Fusion Application in the coexistence strategy. And I gave you in the previous slide just some of the examples that you can look to distributed order orchestration, talent management, et cetera.

Now when customers hear this their next question is, "Okay but if upgrade today to 12.1 or J.D. Edwards 9.0 or any of the releases doesn't that mean I have to pay a cost twice, and what is my actual go-forward?" And actually it's not really true. In fact you're getting business benefit and you're deflecting a lot of the cost or really absorbing some of the cost because it's really more of a journey towards Fusion Applications.

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Let me give you a couple examples of what I mean by that. First and foremost I talked about the business process and how the business process was based on the prior learnings from the E-Business Suite and J.D. Edwards, PeopleSoft, really all the product line. And there are a number of examples in each and every product line whereas you upgrade to the latest release; you get the business benefits of that latest release, and in fact those business benefits are shared in common with Fusion Applications.

For example, in the E-Business Suite 12 we added a new set of capabilities, really geared at global operations and shared service operations, things like sub-ledger accounting on the finance side, things around multi-order to enable better shared service and global operations. Those changes, business benefit are the foundation for the Fusion financials as well.

So if you were to upgrade to release 12.1 of the E-Business Suite you're able to achieve a lot of the business benefits in and around the finance area and have those business benefits still hold as you move forward if you move them subsequently to the E-Business Suite to Fusion Applications.

So you're really making the change management effort upfront once and then holds going forward. You get the business value of it once you do it in E-Business Suite and that business value remains as you move forward to Fusion Applications.

Next is every application release: 12.1 of E-Business Suite, J.D. Edwards, PeopleSoft, Siebel et cetera, every application release not only continue to support their existing platform or infrastructure but now they're all certified under Fusion middleware 11.G.

So what this gives you the capability of doing is starting to break up the technical parts of the upgrade to Fusion and the functional aspects because on any of the existing products lines as part of the upgrade you could upgrade your middle tier or your technnology stack. Doing so once allows you to keep and maintain the technology stack going forward to Fusion because it is an identical technology stack that Fusion uses, the latest commercially available 11.G of the middleware.

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Then in addition to that there are a number of examples where you can then take advantage of the middleware. So you can start to use the SOA Suite and the BPEL business processes or integrate Oracle as third party applications or in fact any custom application to third party applications. You could take advantage of things like identity management for centralized security in and around the existing applications but really applying to your entire ecosystem. You can use things like enterprise manager to monitor and measure performance and help all of your systems, not only existing application investments.

Then the same one for Fusion going forward as well as third parties. And things like business intelligence, the business intelligence tools and business intelligence applications which are really common to all of the Oracle applicational suite.

So again, another example of upgrading today an existing release, getting business value and having that business value hold without additional cost or with incremental cost as you move Fusion Applications.

Then finally as you move forward and do these pieces, as you upgrade the more you upgrade it affords tighter and tighter integration with the other parts of Oracle. So you don't have to consider yourself simple a PeopleSoft customer or a Siebel customer or E-Business Suite customer but really as an Oracle customer and start to take advantage of things like the value chain planning best in class capabilities we have in supply chain extending the Hyperion footprint how it integrates with financials and planning, adding a common GRC or governance risk and compliance application really independent of any application suites that you're on. Three examples I just gave, extending the value in a coexistence fashion today. And then some of the applications - move forward will actually be coexistence applications from Fusion.

So with that let me go through just a couple of examples of how our customers are following this advice to give you a better context of what that means to you as you move forward with Fusion Applications or move forward with the applications in general. Again, possibility number one is in fact not to go to Fusion but I'm going to give you four examples of customers that have started deploying Fusion

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Applications to give you a better sense of the business value propositions and the coexistence scenarios.

So the first customer is Eaton Corporation. They are global automotive parts supplier and manufacturer based in the United States but really a global organization. They have a multitude of order capture systems from Siebel to custom order capture systems that they built up really over time as their business grew and as they grew to acquisitions as well.

They also have a multitude or ERP systems or order fulfillment systems - third party systems and then partner systems if their partners do fulfillment. Now the business issue is for the most part their many order capture systems are connected one to one with their order fulfillment systems.

So if the order comes in and it is on time and it can fulfill from the order capture system, as it connects to auto fulfillment, that generally is fine.

However where they run into business challenges is when the order arrives and it is not able to be fulfilled in the order fulfillment system. And instead they need to really look at and connect the various order fulfillment systems that they are using or that they have to see where the order is best fulfilled.

In the Eaton case they implemented in a brand new application from Fusion. It's called distributed order orchestration. It is really a type of order hub so it is designed as a service-oriented application that had a set of web services which integrates with order capture systems, does things like global order promising, inventory management and costing that allows a customer to then make the best decision on where the order should be fulfilled, and then use again the web services being a service-oriented app to communicate with the order fulfillment systems so that they fulfill the order in the best possible spot.

So in this particular scenario the customer is continuing on with Siebel in their order capture systems, not upgrading any. They are continuing on with Oracle, E-Business Suite and SAP on the ERP side. And in a business pain point their adding into their footprint distributed order orchestration as really a global order hub to really augment their existing order capture and order fulfillment systems and drive

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business value. Implementing Fusion while staying on the E-Business Suit and in fact upgrading the E-Business Suite to 12.1 and continue to drive business value in a coexistence fashion.

Example number two is Principal Financial Group, financial services company in the United States. They have two distinct business problems and two distinct installations. So first they have PeopleSoft HCM 8.9 for their core HR payroll benefit. They do have plans to follow our advice and in fact upgrade-they're looking at the upgrade to 9.1.

But simultaneous to that they have a couple special needs around talent management and compensation management and because of the user interface because of the SAS component and because of the embedded business intelligence they've really chosen to go forward with the Fusion talent management and compensation products and they will have these products live side-by-side integrated with the PeopleSoft HR system which are upgrading to 9.1 so they're continued on PeopleSoft but really looking at particular areas where they have pain points in adoption Fusion in a side by side coexistence fashion.

Similarly on the finance side they're currently on 8.8 of PeopleSoft financials, they are planning an upgrade of PeopleSoft 9.1 of financials. But they have a particular need around sourcing, spend analytics, client management and contract management.

Once again, the Fusion business intelligence which is embedded into the UI and the rich user interface is really what drove them to choose Fusion Applications from the business perspective but they are continuing to implement Fusion sourcing, spend management and the procurement product line side by side to the existing PeopleSoft financials so they'll integrate Fusion procurement with the PeopleSoft financial capability and again a coexisting fashion in this case in two back office areas finance and HR.

The third customer example is Siemens and specifically Siemens PL which is a software component of overall Siemens Corporate. They have a couple different business issues. The first is that they have two CRM systems, one in Europe which they've run CRM on demand the Oracle existing product

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and a second in the North America that runs a software acquisition they made, Siemens PLM which runs SalesForce.com.

More than SalesForce.com they've actually heavily utilized the platform as a service component to build out and extend the existing CRM and Sales Force automation application.

So their interest in Fusion came from the improvement in UI, the SAS capability as well as the platform as a service so ability to extend and build out beyond the existing application not only in a configurable fashion but also have it be hosted as a SAS offering.

And so they really have two steps: the first is they're going to continue with CRM on demand in Europe but implement the Fusion CRM applications in North America business unit. So in a sense they will have no integrations with two side by side CRM applications, CRM on demand as well as Fusion.

And on a go-forward basis it extends the applications through platform as a service really move all of their business over to Fusion CRM so they have then one single platform, complete view of the customer across both North America and Europe on their CRM platform.

So as a third example of coexistence - this one where it's one part replacement to SalesFOrce.com on the CRM side but integrating that back to the existing CRM on demand application as well. So there are two Oracle applications really living side by side.

And then the final example is one that's much more of a complete replace and this is a public sector customer whose main objective and main business problem is to manage and deal with the complexities around compliance and financial controls that they have so essentially it is a public sector or government contractor that receives grants in particular funding from the U.S. government and needs to account and audit that those funds are being spent on the particular projects that they have in place.

So once again this is an example of kind of side by side co-existence option where the customer runs today PeopleSoft HCM 9.1, PeopleSoft Procurement 9.1 but in fact their financials run on a number of existing custom and legacy systems.

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So step one for the customer is side by side to PeopleSoft HR and procurement is to implement the projects and portfolio management as well as the financial applications in Fusion, replacing of a pillar, if you will, replacing the existing custom and legacy applications.

So once again kind of a combo on this customer of a net new implementation in the finance and project space but in a coexistence fashion to PeopleSoft HR and PeopleSoft Procurement both of which have already upgraded to 9.1 so really taking our advice and achieving great business value from those upgrades.

So with that what I've covered today is why we built Fusion Applications not as a replacement for existing applications but really to capture this inflection point that's happening in this industry. 100% standard-based applications built with embedded business intelligence, collaboration built in and offered not only in the traditional model of on premise but also in SAS. And with this innovation giving you a number of examples of where Fusion can bring business value add and do so because of its modular and service-oriented nature in a way where you can not only take advantage of the Fusion Applications today, have a path going forward, but also be able to leverage our existing investments in the existing application suite and really have those sit and live and operate and function in the best possible business value to you which is a coexistence scenario.

So with that hopefully many of the key objectives and key takeaways for Fusion are well understood, 100% standard-based, embedded BI, web tool for collaborations and offered on premise on the cloud.

Thank you very much for your time.