EXECUTIVE OVERVIEW Were living in an age of globalization, ushered in by the forces of technology, the real-time availability of information, and the rise of new economic powerhouses such as India and China. In this new age, national boundaries are collapsing as labor, R&D, and money flow seamlessly around the world to those companies offering the best return on investment.
To stay on top of their game, companies must adopt new strategies to win over global consumers, recruit professional talent worldwide, and source from the lowest-cost nations. They must deploy the right infrastructure to manage their global operations in the most cost-effective and efficient manner. And finally, they need to produce accurately, timely information across the enterprise to meet the increasingly complex tax and regulatory reporting requirements need to support global operations, as well as address investor demands for greater transparency and accountability.
As a business expands into new geographic markets, its faces the challenge of supporting operations for a multinational enterprise. Today, most global companies operate with local systems scattered all over the world. Successful businesses, however, shift to global systems. Global systems provide better access to information; decrease compliance risks and support costs savings initiatives like shared service centers.
With operations in 145 countries supporting over 23,000 applications customers worldwide, Oracle knows the kind of business systems and strategies the most successful companies are adopting to succeed in the new global economy. This white paper summarizes those strategies and Oracles comprehensive approach to globalization. The paper also offers a detailed examination of the global functionality built right into the Oracle E-Business Suite to ensure that customers have the flexibility and scalability required to operate globally, while successfully addressing local business and regulatory requirements.
Oracle Confidential page 2 - A NEW GLOBAL ECONOMY
We came to India for the costs, we stayed for the quality, and now were investing for the innovation.
BusinessWeek, August 22, 2005 . Dan Scheinman Senior Vice President for Corporate Development, Cisco, Inc. BusinessWeek, August 2005 1
The above quote illustrates the emergence of a new global economy where borders, workers, and consumers are increasingly seamless. Not only do global giants like Cisco and Motorola source much of their R&D and manufacturing out of Asia, but they know that in order to stay competitive they have to adopt new strategies to win global consumers, recruit professional talent worldwide, and source from the lowest-cost nations.
The new world economy is not only impacting the operational strategies of American companies, but is also influencing their source of profits. In 2004, foreign operations accounted for 30 percent of all U.S. corporate profits and 58 percent of the increase in earnings growth, and that percentage is expected to rise exponentially as U.S. multinationals like Cisco and Motorola continue to invest heavily in their overseas affiliates. 2 For analysts like the Boston Consulting Group, the success of not just American companies but all global multinationals will be determined increasingly by their ability to fully mobilize in emerging powerhouses such as India and China; those without a global strategy or presence will be left by the wayside. 3
As companies move to operate globally, Oracle knows that it is important for managers to rely on their core business practices to define their global strategies, develop their global corporate culture, and establish global processes, rather than being driven by IT considerations. We also know that it is critical to establish the right IT infrastructure to support global processes, while retaining the flexibility to support a myriad of local regulations.
Oracle E-Business Suite enables companies to pursue global opportunities and transition their companies to a global model to run their worldwide enterprise optimally. Oracle provides a global solution that will meet both worldwide and local business practices, taking into consideration corporate level needs and subsidiary level constraints, while allowing for future growth of the global enterprise.
Once companies start utilizing Oracle E-Business Suite to meet their global objectives, they will see an increase in the quality and visibility of their business information, which will drive to more time-efficient and intelligent business decisions. Oracle E-Business Suite is a truly global solution, as we design and build every feature with a global perspective.
1 A New World Economy, BusinessWeek, August 22, 2005. 2 U.S.: Why Profits Are Defying Gravity, BusinessWeek, April 18, 2005. 3 A New World Economy, BusinessWeek, August 22, 2005. Oracle Confidential page 3 - ORACLES GLOBALIZATION STRATEGY Practicing What It Preaches: The Oracle Billion-Dollar Story In 1998, Oracle embarked on a shared services center strategy, establishing service centers in California, India, and Australia as the hubs of its finance operations. Finance and business processes were automated, streamlined and standardized across the globe, improving data integrity and business intelligence. Group operations are now fully-comparable and a single instance of Oracles financial applications software gives a single version of financial and non- financial truth.
Oracle is on track to save over $2 billion since 1998, more than paying for the cost of the new system. Finance headcount has fallen by a quarter and total finance and accounting costs have declined by 30 per cent. Thanks to self-service, local accounts teams have downsized and now concentrate mainly on strategic purchasing and payroll matters. Better risk management and transparency mean cheaper capital costs, too. Finance directors, meanwhile, are free to concentrate on business.
Consolidated group financial information is readily available to meet new compliance mandates. Reporting cycles are shorter, operational reviews and audits are easier, and new acquisitions are integrated much faster. Managers can collect, consolidate and communicate information at any time. Oracle has become a more agile, flexible, confident business and the system has helped in building a strong culture of compliance and accountability.
. Oracles globalization strategy is simple: deliver a single, seamless solution that allows our customers to run their business efficiently and effectively, regardless of where they do business. Customers using Oracle applications strategy have the ability to continuously improve their business processes and maximize their business growth potential, leveraging the latest tools and technologies to buy or sell anything to anyone, anywhere, at anytime.
The product development focus of Oracle E-Business Suite is on global companies doing business worldwide. Functionality is designed to help companies compete globally, while managing their businesses locally. Market specific features are delivered in a single code set with the standard products, simultaneously to all markets.
Oracle's approach to globalization ensures support for many local requirements, while allowing efficient, consistent business practices across the enterprise. Oracle E-Business Suite supports 30 languages in a single instance infrastructure with scalable applications, including inherent support for Unicode. Customer investments are protected through global support and automatic upgrades.
With over 23,000 applications customers operating in 145 countries, Oracle has years of proven experience helping customers understand and address the complexities of operating globally. Our own internal implementation of the Oracle E-Business Suite is additional proof that moving to a single global data model and standardized business processes can provide companies with the flexibility, responsiveness, and information they need to compete in todays fast- moving global markets.
Oracles globalization strategy is based on three simple principles outlined below: streamline business processes; consolidate business information; and comply with local, national, and international regulatory requirements.
Streamline Business Processes Reduce operational costs and improve efficiencies by utilizing: - Self service applications to eliminate non-value add activities - Shared services support where processes are centralized and managed - Workflow to automate business rules and policies
Consolidate Business Information Produce high-quality, real-time information - Single data model - Single global instance - Comprehensive cross-functional E-Business Suite - Corporate Performance Management - Daily Business Intelligence Oracle Confidential page 4 -
Comply With Local, National and International Regulatory Requirements Achieve sustainable compliance - Features to help a company implement business processes, tax solutions, management reporting and activity monitoring on a global basis - Country-specific globalizations for national and regional indirect tax requirements, local fiscal regulation and corporate citizenship - Internal Controls Manager to support regulations such as Sarbanes-Oxley
The selection of the right enterprise business application to support a companys globalization strategy and future business requirements is critical to their continued survival and success. Moving to the very latest Oracle application technology--Financials 11i-- has enabled Sun to globalize business processes, consolidate multiple instances of Oracle, curtail the need for customization, and implement business and IT operational efficiencies that were previously unattainable. As a result, Sun has achieved simplification and significant savings in our IT expenses and resource requirements." -- William Vass, VP of Corporate Software Services IT, Sun Microsystems, Inc.
This paper will discuss Oracles strategy, organization and methodology that have been key element s in our companies success as a world-class global solution provider. This paper will also discuss Oracles product capabilities that set us apart as the only integrated global enterprise application that can provide a functionally complete set of business applications, and a single unified information architecture that ensures a consistent global definition of business entities, enables real-time business intelligence and reduces compliance risks. Organization and Methodology Oracle has seen enormous growth in its customer base in the U.S., Europe, Latin America, Japan and Asia Pacific. This expansion increases the reach of our customers to over 100 countries worldwide. As part of our globalization strategy, Oracle employs Product Development, Domain Experts and Consultants who contribute to Oracles global solution.
With a high-level of expertise and knowledge worldwide, Oracle is able to fully build an integrated global solution where we
Provide a global enterprise application that supports global business practices, multiple languages and statutory and common business requirements across the major economies of the world, plus country- specific market driven needs. Use our global functional expertise The key to building a global enterprise management system is to begin with the appropriate requirements. In many countries we have considerable depth of knowledge in accounting and business practices and we can rely on that knowledge to generate requirements. We have multinational Special Oracle Confidential page 5 - Interest Groups, internal and external Advisory Boards and these provide valuable insight and review for product requirements. In addition, we have relationships with our global partners to give us a consistent level of understanding across all the countries of interest and to help prioritize the various requirements. This active and continual engagement allows us to incorporate customer expectations and domain expertise into our products, ensuring we deliver a solution that meets your business requirements. "With Oracle Projects, we can now have staff working on the same project in different countries and charge to the project in local currencies, we can also send out invoices in whatever currency the customer requires." Brian Bodsworth, CIO, Capgemini U.K. . Develop, package, and release centrally and concurrently With Oracle E-Business Suite, a multinational company does not have to deal with individual countries and organizations to understand functional content or for delivery schedules, as Oracles applications are developed, packaged, and released centrally and concurrently from corporate headquarters. Support globally Oracle provides both patches and support in a timely manner in all languages and locales required. The E-Business Suite provides support for 30 languages and our worldwide support professionals are available 24 hours a day, 365 days a year, to support global operations anytime, anywhere. ORACLE E-BUSINESS SUITE: A WORLD-CLASS GLOBAL SOLUTION
Oracle E-Business Suite offers a truly global product that allows companies to operate anywhere, at any time, with a single integrated suite of applications. Our products support both multinational and national business practice, providing organizations with the ability to address regulatory issues in a wide range of markets, and the tools they need to help stay competitive in the management of their operations worldwide.
Oracle E-Business Suite provides configurable standard products and specific global product features to support global and local requirements without the need for costly customizations. Each module within the E-Business Suite is fully integrated on a common IT infrastructure and with a single data model for consistent information and transaction flows across all applications. Yet Oracles applications are also modular they can be implemented singly, as several modules or the entire suite. Oracles open architecture allows you to easily integrate these modules into your existing applications and fully leverage your IT investments. Oracle Confidential page 6 -
Oracle B-Business Suite Language Support: Arabic Chinese, Simplified Chinese, Traditional Croatian Czech Danish English, American Finnish French French, Canadian German Greek Hebrew Hungarian Italian Japanese Korean Norwegian Polish Portuguese Portuguese, Brazilian Romanian Russian Slovak Spanish Spanish, Latin American Swedish Thai Turkish
Oracle E-Business Suite Oracle E-Business Suite provides a flexible and comprehensive solution that enables companies to run their worldwide business, while also supporting their local business practices.
Multiple Language Support (MLS). Oracle E-Business Suite allows for an unlimited number of languages that can be run concurrently on a single instance, supports multiple character sets, and produces multilingual documents. In other words, we provide the ability to have different users running the same software, on the same database, in different languages. MLS has many components, including user interface, external documents (printing invoices in local language), and descriptions in different languages. Oracle Confidential page 7 - Currency Management. Oracle E-Business Suite provides tools to support statutory and legal reporting requirements when using many currencies. Local Practices. Oracle E-Business Suite supports global and local business processes through features such as a flexible chart of accounts, tax-reporting ledger, shared service capabilities, inter-company tracking and multiple organizations. It also provides support for country- specific functionality to meet national requirements in areas such as taxation, accounting practices, assets, and reporting. Flexible Date Formats & Multiple Radix Support. Oracle E-Business Suite allows users to enter and view dates in any national format and enter and view numbers in the radix format appropriate to the country of operation. For example, a U.S. user might enter the number 5,000.29, which a German user subsequently views as 5.000,29. LG.Philips LCD invested US$21.9 million in an Oracle-based enterprise resource planning solution to integrate and automate its international manufacturing operations, and an additional US$4.0 million on a new Oracle-based human resources management system. In total, over a five-year period, IDC project LG.Philips LCD will realize US$104.7 million in gross benefits from the ERP and HR projects combined.
IDC Research ROI Study
Unicode Character Set Support. Oracle E-Business Suite supports the Unicode UTF8 character set. Run any combination of languages, including complex text layout and ideographic languages, in an Oracle Applications UTF8 installation. Descriptive Flexfields (DFF). Oracle E-Business Suite provides a tailorable expansion space on your forms. With this facility, a global enterprise can capture additional information for tracking purposes that is unique to that business. Multiple Organizations Structures. Oracle E-Business Suite organization models define organizations and the relationships among them. This multi-organization model defines how transactions flow through different organizations and how those organizations interact with each other. These organizational features facilitate modeling your family of companies and business in the Oracle system. Streamline business processes by reducing operational costs and improving efficiencies
Global Processes. All the elements of Oracle E-Business Suite are engineered to work together to automate end-to-end business processes, across both front- and back-office operations. To improve Oracle Confidential page 8 - efficiencies, Oracle recommends defining global processes to streamline every area of your business i.e. marketing, sales, service, contracts, order management, procurement, supply chain, manufacturing, financials, projects, human resources, and professional services automation. Shared Services. Oracle E-Business Suite facilitates storing the data of many organizations within the same database instance, providing both consolidated repository of data, and the potential geographical separation of the data processors, the data owners and the data. It allows companies to set up remote (eg. India) shared services to centralize operational processing, liberating other areas of the enterprise to focus on strategic initiatives. Workflow Automation. Oracle provides workflow to automate business practice rules such as approvals, alerts and complex routines such as those involved in the financial close. For example, it can handle different types of workflow processes automatically such as requisition and expense approvals, thus minimizing manual administration. Self-Service Applications. Oracle provides self-service applications so companies can reduce non-value add activities by individuals, increasing productivity and reducing overall operating costs. Oracle Self-Service applications also enable collaboration with trading partners beyond the traditional enterprise boundaries: - Oracle iSupplier enables secure, self-service business transactions between companies and their suppliers through the internet. This allows a supplier to provide better customer service at a lower cost. - Oracle iReceivables enables a companys customers and employees to use and access Receivables data. Customers can perform extensive inquiries, dispute bills, pay invoices, and review current account balances online.
Web Single Sign-On. Oracle Single sign-on addresses the problem of users having to remember multiple passwords. It provides a mechanism for users to gain access to multiple applications for which they are registered users by entering a single username and password. Oracle Confidential page 9 - Business Flows. Oracle supports the trend for operational management to cross the traditional application boundaries (i.e. accounts payable, accounts receivable) and instead use common, cross-discipline processes to model their business flows. Touchless Transaction Flows. Oracle enables businesses to automate business processes across all functional areas. This includes straight- through processing in treasury, online real-time credit checking, online bill presentment and payment in receivables, and online invoice presentment in payables.
Consolidate Business Information to produce high-quality information
Common Data Model. Oracle E-Business Suite is the first and only comprehensive set of applications for the enterprise that are integrated around a single, common data model. Oracles unified information architecture consolidates data from Oracle and non-Oracle applications and allows a consistent definition of customers, suppliers, partners, employees, and all business entities across the enterprise. You can create a single global definition so that everyone, worldwide, is accessing the same data. Oracles single, common data model ensures accurate and consistent information and transaction flows across all applications. Oracle is also providing configurable processing engines that will handle the specific needs of processes that are shared across multiple applications. For example, a common tax engine can accommodate purchase orders from purchasing, invoice processing from payables and expenses, and receipt processing from receivables. All these applications can perform consistent tax processing from a common resource, offering a coordinated approach to global operations. Global Single Instance. Oracle technology allows companies to consolidate their database instances so they can have greater flexibility, manageability, and scalability of their existing and future worldwide operations. Some key benefits: - Consolidated Technical and System Administration. A single instance of Oracle E-Business Suite allows a company to consolidate technological resources and maintain a single point Oracle Confidential page 10 - for administration and support of the entire system, which in effect reduces costs.
- Consistent User Interface. In a single instance of Oracle E- Business Suite, all users in a multinational company throughout the world use the same windows, forms, and reports. This greatly improves the communication between subsidiaries and individual users, and improves the process flows between different organizations in the company.
Installation of Oracle E-Business Suite. In a single instance of Oracle E-Business Suite, installation, maintenance, and upgrades are managed with greater ease and efficiency.
Of course, consolidated database instances also provide more complete information, accessible in real time. The advantages of real-time business information will be discussed in the following section.
Consolidations: Global enterprises must consolidate financial information at both a detail and a summary-level, with the ability to perform drill-downs to the transaction level. Oracle Financial Consolidations Hub brings together financial data from disparate sources to create a single a single, global view of financial information across the entire enterprise. Data transformation and validation procedures ensure that information is automatically standardized while providing complete audit trails from consolidated totals to original source balances. A simple framework allows you to tailor the steps in your consolidation cycle, whether the same process should be applied across the entire hierarchy or special procedures are necessary for different sub-consolidations. This allows you to consistently codify standard and repeatable business processes, reducing manual intervention and minimizing the opportunities for error and misstatement. Corporate Performance Management. Corporate Performance Management (CPM) is a concept that encompasses business activities across planning and budgeting, consolidation, analysis, and monitoring: Its where strategic planning intersects with the ability to execute, measure, and act upon results. A few of Oracles Corporate Oracle Confidential page 11 - Performance Management products are: Balanced Scorecard, Enterprise Business Planning & Budgeting, Activity Based Management, Financial Analyzer, Sales Analyzer and Demand Planning. - Oracle Balanced Scorecard helps customers design, develop, and deploy custom corporate performance management solutions. With Balanced Scorecard, managers can better communicate strategic objectives, align organizational objectives and resources, and proactively monitor key performance indicators.
- Oracle Enterprise Planning and Budgeting controls the business processes of planning, budgeting, forecasting, monitoring, and analysis, integrating performance management with personal accountability. Enterprise Planning & Budgeting provides finance and business managers with the right information and self-service tools to help them understand the business better, control the planning process, and tune plans to improve results.
- Oracle Activity-Based Management is an enterprise application that provides accurate cost information to managers. Managers use Oracle Activity-Based Management to improve profitability and examine resource allocations. Oracle Activity- Based Management goes beyond traditional cost allocation, and enables companies to model the complexity of costs based on activities, materials, resources, and product or service components.
- Oracle Financial Analyzer is a flexible analytical tool, which allows companies to manage financial reporting, analysis, analyze performance metrics, evaluate risks and opportunities, and formulate future direction.
- Oracle Sales Analyzer is a decision support application that provides a wide range of tools for ad hoc analysis and distribution of sales and marketing information.
Oracle Confidential page 12 - - Oracle Demand Planning is a tool that allows global companies to generate accurate demand forecasts in an internet-based collaborative environment, incorporating information from sales marketing, operations, and customers.
Comprehensive cross-functional business application. Oracle E- Business Suite is a comprehensive set of enterprise-wide business applications that work together to deliver integrated, cross-functional business processes: Corporate Performance Management Customer Relationship Management Financial Management Human Capital Management Procurement Project Management Supply Chain Management
Deliver timely up-to-date and real-time business information A single complete data model enables companies to get better information out of their system and also benefit from consistent, accurate, and enterprise wide data. With data stored in one place, you can run all your applications on a single instance, thus reducing IT expenses (i.e. software interfacing, data translation, and integration).
Daily Business Intelligence. Oracles comprehensive suite of applications deliver an integrated intelligence that spans across all areas of your business and provides information that everyone in your organization can use including executives, managers, employees, customers, suppliers, and partners. Business Intelligence information is displayed in a customizable portal, to give up-to-the-minute intelligence on the relevant information needed for an effective response to market conditions. Daily Business Intelligence is made possible since the E-Business Suite can be run on a single global instance, allowing the maintenance of enterprise data in one place. With fewer instances, it is easier to share information across organizations, enabling better cooperation and greater productivity. Daily Business Intelligence delivers an instant snapshot of your companys business (i.e. daily profit and loss views, Oracle Confidential page 13 - financial balances) so that fact-based real-time decisions can be made to drive change and increase efficiency. The Business Intelligence application resides in the same system as real-time operational data, so there is no delay in accessing all the information needed for critical decisions. Oracle Daily Business Intelligence empowers managers to stay on top of the critical activities of their organization. DBI offers enhanced visibility by providing enterprise-wide performance information daily. DBI enables managers to maximize performance and opportunities, identify potential issues earlier, and address them before they escalate. CONCLUSION Oracle has built an organization, infrastructure, and methodology that set us apart from other global application solutions providers. Our wealth of expertise and knowledge has made us a leader in providing a flexible, fully integrated global solution to help companies run and manage their business globally.
Our strategy is global.
Oracle is a global company and understands what it takes to be a global partner. We are committed to being a strategic supplier to our global customers. Our account management is global, our implementation expertise is global, our product support is global, and our development team is global.
Whatever your global strategy is regarding operational models, shared service centers, languages, outsourcing and data standards, Oracle can support you.
Oracle is truly global.
Oracle E-Business Suite allows companies to take advantage of global opportunities without restrictions, ensure consistent global processes while addressing local practices, provide companies with complete, high-quality information across the entire enterprise, reduce overhead costs through integrated applications and elimination of IT complexity, and deliver a global application product in a single code set to help run the global enterprise more efficiently and more cost effectively.
Oracle E-Business Suite is the only solution that can provide a complete suite with unified information architecture for immediate access to high-quality global data, to help you make smarter decisions with better information. Oracle Confidential page 14 -
ORACLE E-BUSINESS SUITE COUNTRY SUPPORT
Afghanistan Albania Algeria Andorra Angola Antigua and Barbuda Argentina Armenia Australia Azerbaijan Bahamas Bahrain Bangladesh Barbados Belarus Belgium Belarus Benin Bhutan Bolivia Bosnia and Herzegovina Botswana Brazil Brunei Bulgaria Burkina Faso Burundi Cambodia Cameroon Canada Cape Verde Central African Republic Chad Chile China Colombia Comoros Congo (Brazzaville) Congo, Democratic Republic of Costa Rica Croatia Cyprus Cte dIvoire Denmark Djibouti Dominica Dominican Republic East Timor (Timor Timur) Ecuador Egypt El Salvador Equatorial Guinea Eritrea Estonia Ethiopia Fiji Finland France Gabon Gambia Georgia Germany Ghana Greece Grenada Guatemala Guinea Guinea-Bissau Guyana Haiti Honduras Hungary Iceland India Indonesia Ireland Italy J amaica J apan J ordan Kenya Kiribati Korea, South Kuwait Kyrgyzstan Laos Latvia Lebanon Lesotho Liberia Liechtenstein Lithuania Luxembourg Macedonia Madagascar Malawi Malaysia Maldives Mali Malta Marshall Islands Mauritania Mauritius Mexico Micronesia, Federated States of Moldova Monaco Mongolia Morocco Mozambique Myanmar Namibia Nauru Nepal Netherlands New Zealand Nicaragua Niger Nigeria Norway Oman Pakistan Palau Papua New Guinea Paraguay Peru Philippines Poland Portugal Qatar Romania Russia Rwanda Saint Kitts and Nevis Saint Lucia Saint Vincent and The Grenadines Samoa San Marino Sao Tome and Principe Saudi Arabia Senegal Serbia and Montenegro Seychelles Sierra Leone Singapore Slovakia Slovenia Solomon Islands Somalia South Africa Spain Sri Lanka Sudan Suriname Swaziland Sweden Switzerland Syria Taiwan Tajikistan Tanzania Thailand Togo Tonga Trinidad and Tobago Tunisia Turkey Turkmenistan Tuvalu Uganda Ukraine United Arab Emirates United Kingdom United States Uruguay Uzbekistan Vanuatu Vatican City Venezuela Vietnam Western Sahara Yemen Zambia Zimbabwe
Oracle Confidential page 15 -
ORACLE E-BUSINESS SUITE LANGUAGE SUPPORT Arabic Chinese, Simplified Chinese, Traditional Croatian Czech Danish Dutch English, American Finnish French French, Canadian German Greek Hebrew Hungarian Italian J apanese Korean Norwegian Polish Portuguese Portuguese, Brazilian Romanian Russian Slovak Spanish Spanish, Latin American Swedish Thai Turkish Oracle Confidential page 16 - Oracle Global Persepctive August 2005
Oracle Corporation World Headquarters 500 Oracle Parkway Redwood Shores, CA 94065 U.S.A.
Copyright 2005, Oracle. All rights reserved. This document is provided for information purposes only and the contents hereof are subject to change without notice. This document is not warranted to be error-free, nor subject to any other warranties or conditions, whether expressed orally or implied in law, including implied warranties and conditions of merchantability or fitness for a particular purpose. We specifically disclaim any liability with respect to this document and no contractual obligations are formed either directly or indirectly by this document. This document may not be reproduced or transmitted in any form or by any means, electronic or mechanical, for any purpose, without our prior written permission. Oracle, JD Edwards, PeopleSoft, and Retek are registered trademarks of Oracle Corporation and/or its affiliates. Other names may be trademarks of their respective owners.