Oracle urges ERP users to upgrade to EBS 12.1

Although Fusion Applications are finally on the horizon, many users are still dealing with legacy systems

Oracle is hoping to make a big splash with its upcoming Fusion Applications launch, but in the meantime has the perennial and less glitzy task of persuading users to upgrade from older releases of E-Business Suite.

"If I were in your situation, I would be making a plan," said Cliff Godwin, senior vice president of applications development, during a keynote address Monday at the New England Oracle Applications User Group conference in Worcester, Massachusetts.

[ As big-bang ERP rollouts decline, Oracle has had to find news ways to make up for the lost revenue. | Third-party support contracts are another potential threat to Oracle's bottom line. | Discover what's new in business applications with InfoWorld's Technology: Applications newsletter and Killer Apps blog. ]

Godwin ran down a long list of features and improvements in the current release, EBS 12.1, covering areas such as manufacturing, warehouse management, global tax calculation, patch automation, and mobile integration.

Premier Support for EBS 11.5.10 officially ends in November, meaning users who choose to stay on that edition would normally face additional maintenance fees for Extended Support. Last year, citing the bad economy, Oracle announced that it would waive Extended Support fees (pdf) for one year on a number of products, including 11.5.10.

In any event, it seems that few EBS users have upgraded to R12 so far. Altimeter Group estimates that roughly 5 percent of EBS installed base is running either version 12 or 12.1, said Ray Wang, a partner in the analyst firm.

That number "is about right" given the circumstances, Wang said. "People initially shy away from the first release of any product." R12 was released in early 2007, while R12.1 arrived in May 2009. "It was not till 12.1 that we started to see momentum in adoption."

Moreover, "the downturn in the economy and stability of the 11.5 product has probably been a key reason for slower adoption than normal," Wang added.

Indeed, during a conference session on R12 upgrades held by Oracle systems integrator USJade, the presenter asked how many of the roughly 100 attendees present had such a project under way, and it appeared that nobody raised a hand.

But one user who attended the session said her company is now in the planning stages for an upgrade.

"[The system has] been very stable. But you we're at the point where we need to do more. We're getting requests from users for enhanced functionality that we see will probably or possibly be available in R12," said the user, an Oracle business analyst for a U.S. manufacturing company who spoke on condition of anonymity.

Moreover, the company is using EBS 11.5.9, which is already on Sustaining Support, a maintenance option for older platforms that does not includes services like critical patch updates. "So any problem that comes along, we are pretty much having to solve ourselves," she said. Add in a "tiny" IT staff with which to serve the company's users, and the situation has become difficult, she added.

The recent rough economy took its toll on the company, which put off an upgrade, which she now hopes will begin soon.

Upgrade projects could pick up pace soon, according to another Oracle user.

Frank Malangone, vice president of information systems at construction and engineering firm Camp, Dresser & McKee, is "noticing a turn to Release 12" among E-Business Suite users. "People are starting to hear the buzz that 12.1 is stable," said Malangone, who is also a NEOAUG board member. "People are on it. People aren't losing their jobs going to it."

Camp, Dresser & McKee will probably start an R12 upgrade project next year from its current 11.5.10 implementation, he said.

Fusion Applications are of interest but not on the immediate horizon for Malangone, and many other users, he said.

An initial wave of Fusion products will be launched this year, according to Oracle CEO Larry Ellison. But no general availability date has been announced for the long-delayed software suite, which is supposed to combine the best attributes of Oracle's various business application lines.

"First of all, no one knows what it is. Until it's announced, there's no sense to talk about it. As far as planning, you need to plan with what's available today," Malangone said. "I think there's also a sense of a track record of no one wanting to be first. It's going to take a while to build up the momentum."

However, "the little bit I've seen of Fusion is very impressive," Malangone said. Hopefully, once Fusion Applications are formally announced, Oracle will articulate "the Release 12-versus-Fusion strategy, and the thought process we should be going through on which direction to go," he added.

Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris's email address is Chris_Kanaracus@idg.com

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