People, Ideas & Objects and Oracle Corporation
What we expect to gain from the review of the Oracle products in the Resource Marketplace module and the rest of the Preliminary Specification is simple. To put some substance to the Preliminary Specification from the point of view of the generic ERP systems requirements. Using the Oracle Database, Oracle Fusion Middleware and Oracle Fusion Applications will provide a strong foundation for the innovative oil and gas industry.
Looking at the Oracle Fusion Applications from the perspective of the Resource Marketplace module it is easy to see where we can start. In the Preliminary Specification so far we have not discussed what is traditionally been called the Human Resource or Human Capital area of the firms needs. This of course would fall under the Resource Marketplace module as these people are part of the Resource Marketplace. Oracle has a number of products that fall under this category in their Oracle Fusion Applications and we will discuss them here. I noticed this quotation that shows we are consistent with Oracle’s approach to the marketplace in terms of how their Oracle Fusion Applications are to be used.
I read this as consistent with our intent to use Oracle Fusion Applications in the following manner. That they are open to customization through the Oracle Fusion Middleware layer. They are standards based and can be used as a service oriented architecture which is another term for “cloud” computing. Lastly we are an Oracle customer that “fills the gap” between the oil and gas industry and the technologies that Oracle provides.
The first document that I want to look at is a brochure that was published by Oracle entitled “Oracle Fusion Human Capital Management: The New Standard for Human Capital Management.” Within it Oracle lists the fifteen applications that fall under the Human Capital Management Suite.
The first and summarizing paragraph of the brochure shows that we are in the same ball park and playing the same sport as Oracle with respect to the Military Command & Control Metaphor (MCCM). Although our concept has been developed further to include multiple organizations in the Joint Operating Committee and the service industry, they have developed the concept within the standalone organization to a significant level.
Reading their documentation I see this emphasis on role throughout, which is a necessary part of the MCCM, and being a critical part of their application suites. Having that functionality already there will be a strong first step in making the MCCM real.
One area that we had not touched on yet was payroll, after all everyone likes to get paid. And of course the Oracle HCM Suite provides for these services. What will need to be done is to ensure that the earth science and engineering, as well as any other human resources that are being charged to the joint account, are able to be charged and recovered through the payroll system. I would think that this is something that Oracle would have thought would be basic functionality however I have not stumbled upon it yet. Recall that it is necessary, as a part of a producer's value proposition, that they seek revenues from oil and gas sales, and, from the secondment of their technical resources to the Joint Operating Committees, research and industry at large. The demands for earth scientists and engineers being so great, the costs to develop a team will be too onerous without the ability to generate revenues from them. Therefore a payroll or Partnership Accounting module facing system that bills these resources to the joint account and elsewhere at various rates will be necessary for the innovative oil and gas producer.
I’m intrigued by a grouping of modules within the Oracle Human Capital Management Suite (Oracle HCM Suite) that are somewhat new and provide the innovative oil and gas user with some unique value. Oracle calls this group of modules Oracle Fusion Talent Management which includes the following modules from the Oracle HCM Suite. Compensation Management, Incentive Compensation, Performance Management, Goal Management, Workforce Directory Management, Network at Work and Talent Review. I think that it is worthwhile to place the entire Oracle HCM Suite within the Preliminary Specification. That way producers, Joint Operating Committees and service industry participants will be able to use the modules that they find meets their needs in the most appropriate manner. Recall that People, Ideas & Objects will be providing the software in a “cloud computing” environment which is consistent with the architecture that Oracle has developed their Fusion Applications under.
The purpose in having a Talent Management grouping of applications should be obvious. In oil and gas we have a particular issue with the earth science and engineering resources that are the critical resource of the industry. The expected retirements over the next 20 years, the ability to train new recruits within that time, the increasing requirement of geology and engineering in each barrel of oil, and the expected demand for energy all make these people part of the key competitive advantages of an innovative oil and gas producer. Having software that focused on developing and maintaining these resources would be of great assistance, so lets have a quick look at what Oracle has prepared in terms of Oracle Fusion Talent Management.
First of all it is an assumption that the majority of these resources will be directly employed by the producers themselves. They will be seconded to the individual Joint Operating Committees by the producers that employ them, much as they do today. The employment contract will in all likelihood be comprehensive and include incentive and bonus compensation based on performance. With that said Oracle has three specific compensation related modules in their Talent Management group, Compensation Management, Incentive Compensation and Performance Management. These applications allow the producer to look at the compensation from the global and strategic perspective and from the competitive landscape. Particularly within the geographic region in which they are competing. In areas such as Performance Management the employee has tools in which to guide them through what is expected of them to keep them on course and attaining their goals.
Speaking of goals there is Oracle Goal Management for the producer to establish goals for the organization and individuals within that organization. In a top down manner the goals of the organization can be pushed down to the individual units and groups, and finally to the individuals to achieve within the appropriate time frame. There is also a capability in which employees are able to document their career development.
Oracle Network at Work is a tool that establishes a social network within the confines of the organization. I would think this might be of value if we had it for the entire oil & gas and service industries. Then the whole industry could collaborate and share the information they would share within a social network. The feature that this would have is that it would be dedicated to oil and gas as opposed to facebook which is unfocused.
How about a software tool to evaluate and prepare for the employee review process. In addition this is in a collaborative environment so that the input of the people who are responsible for the individuals performance have input into that process. The Oracle Fusion Talent Review does this and helps you develop the right talent for the right jobs.
The Oracle Fusion Workforce Directory Management provides a graphical representation of the organization chart. This is something that we need for the Military Command & Control Metaphor. The need to extend this beyond the individual organization to include members of the Joint Operating Committees participating producers and service industry representatives would be necessary. The tool provides basic information, including the role the individual holds, their supervisor etc. Exactly what we need in order to begin to impose a chain of command within the temporary organization that is established for operational excellence in the Joint Operating Committee.
Oracle has published a paper entitled “HR in the Cloud: Bringing Clarity to SaaS Myths and Manifestos” that I want to review. It deals with the issues around hosting the Oracle Human Capital Management Suite of applications in a “cloud computing” environment. Since all of Oracle applications are deployable to the cloud, and People, Ideas & Objects will be hosting the Preliminary Specification in that environment, review of this paper will bring some insight into the needs of our software. It's important to note that Oracle is the world's second largest SaaS (Software as a Service) provider, with 5.5 million users worldwide.
It is proposed in the Hardware Policies & Procedures for People Ideas & Objects that the application derived from the Preliminary Specification will be run on a “Private Cloud.” The ownership and management of this organization is subject to the industries input for the purposes of their compliance to SEC and other regulations. Having the application served as a SaaS, as single-tenant, and on a Private Cloud denotes most of the architecture that the application will have to consider.
In a survey Oracle identified that the two most common business processes run on private clouds are Financial / Accounting @ 20%, and Human Resources / Benefits @ 19%. I think the Financial / Accounting category was largely underreported in the survey as there was also Home Grown Applications @ 16%, Inventory / Shipping @ 10%, and Procurement / Purchasing @ 11%. All three of these are probably or traditionally accounting related applications. Making for a total of 76% of the total of all cloud based applications. Clearly the cloud is being used for the purposes that People, Ideas & Objects is planning to use them for.
It is too early to evaluate the proposed People, Ideas & Objects solution on the basis of Total Cost of Ownership from the perspective of a producer. There are not enough facts available to make any decisions or valuable information that would hold up under scrutiny. The oil and gas producer is in a capital intensive business where the costs of ERP systems are not material to the bottom line of the enterprise. The value proposition that is offered in our Revenue Model provides the oil and gas producer with the most profitable means of oil and gas operations.
We have looked at the Oracle identity management and security offerings and included them within the Security & Access Control module of the Preliminary Specification. From a SaaS perspective these tools also provide further value in that privacy laws in the EU and other areas outside of the U.S. are covered by Oracle’s database, identity management and security solutions.
We continue with our discussion of the Oracle paper “HR in the Cloud: Bringing Clarity to SaaS Myths and Manifestos.” Needless to say they’re large technical issues and there will be those that won’t be satisfied with the solutions no matter what the outcome of the Preliminary Specification. It is important to note that many of these features are available only as a result of providing People, Ideas & Objects as a “single-tenant” solution. This is the superior methodology and is the manner in which we are able to provide much of the customization of the Oracle technologies.
Integration of software is where many of the problems show up. We need to maintain a focus on the user to ensure that we are meeting their needs. And to continue to develop the Community of Independent Service Providers that are there to service and support the People, Ideas & Objects software for the producers. Oracle suggests that developing on open standards like Java and Oracle Fusion Middleware allows for further upgrade of the technology even if there are customizations. This little bit of magic will be discussed further as we proceed through the Preliminary Specification. It is however as a result of everything that is contained within the Oracle Fusion Applications are derived from the Oracle Fusion Middleware layer.
Customizations of applications are a fact of life. Not everyone can fit within the standard configuration of what an application should be. The reliance on users helps to keep the focus of where the needs are, and customizations through a dedicated software development capability like that proposed by People, Ideas & Objects are necessary. In addition each producer is unique. The need to have each producer run their own version of the Oracle stack of technologies and the People, Ideas & Objects software in their own virtualized instance on the cloud computer is necessary. This is what is called “single-tenant.” Then each producer is running their own version of the software and their domain is somewhat under their control.
Through the use of Oracle Fusion Middleware these customizations, if done appropriately, will survive the upgrade process. Therefore the ability to have the regular software upgrades of the underlying Oracle technologies will not disrupt the People, Ideas & Objects modules or customizations. Speaking of upgrades the need to manage the upgrade process for cloud computing applications takes on a new priority. Making sure that the appropriate change management procedures and policies are in place, the appropriate testing, that training of the user base and a host of other related issues need to be considered before the technologies are upgraded. It will be easier to upgrade the technologies once, however it must be done with much forethought and consideration of the producers and users needs and understanding of the use of the application modules.
When it comes to performance and reliability the cloud computing architecture is a simple matter of applying the proven rules of specialization and the division of labor. It is far more efficient and effective to have the technologies for hundreds of producers handled by the specialized skills of Database Administrators, Network Specialists and the like then having each of those producers provide support for their technical architecture with one general support person.
One of the key outputs of the Preliminary Specification is the initial geographical scope of the People, Ideas & Objects application modules. This will involve which jurisdictions it will calculate royalties for, which jurisdictions it will meet for securities purposes, and what currencies it will recognize etc. In essence determining the minimum level of functionality to meet the users requirements in the first commercial iteration of the application. Oracle Fusion Applications are global in their scope. Providing the producer with a strong base of functionality in which to determine what is the initial scope of the Preliminary Specification.
Within the Resource Marketplace module of the Preliminary Specification there is a need to provide the service industry participants with software solutions that interact with the producers and Joint Operating Committees. In the area of Human Capital Management, a part of the Resource Marketplace module which the Military Command & Control Metaphor will fall under. Where members of the service industry firms participate in field operations conducted by the Joint Operating Committees. They need to have the ability to participate and fall-in within the chain of command that is established within the temporary organization that is established for the operation being conducted. Therefore the need to access some of the modules of the Oracle Fusion HCM Suite, as well as others, will be part of the Preliminary Specifications offering as well.
And there will be other aspects of the service industry representatives business that will need to be included in the Preliminary Specification. Looking at Oracle’s Fusion Financials and Oracle Accounting Hub there are services that are provided for just this purpose. Recall that we have some unique aspects of the Resource Marketplace module that involve the service industry. And one of those is the ability to design transactions. Therefore the need to have these software services operational in the cloud and accessible by the service industry representatives is critical.
It is not to suggest that we are providing the full accounting services that we are providing to the producer firm and Joint Operating Committees. We are not that familiar with the service industry to provide that level of service. However, Oracle Fusion Accounting Hub provides the means in which they can interface their accounting systems with the People, Ideas & Objects systems. That way they can utilize the services we provide and fully integrate their systems to service and support the innovative oil and gas producer and Joint Operating Committee in its needs.
Modules of the Oracle Fusion Financials include General Ledger, Accounts Payable, Accounts Receivable, Payments & Collections, Cash & Expense Management and Asset Management. These are your generic financial applications and will of course be included in the Preliminary Specification. Where they reside within the specification is not material to the discussion as they will be separate modules much like the eleven modules in the Preliminary Specification. By using modular theory we gain the full use of these Oracle Fusion applications without the complexity of integrating them within any specific module itself.
The days in which we could generate excitement over charts of accounts and journal entries is probably behind us. The ability to deal with the unique needs of the Preliminary Specification is something that I am confident that Oracle Fusion Financials can handle. Based on the Oracle Database, which is by far the leading technical database and market leader. And the result of what Oracle claim to have now invested in Fusion technologies since 2005 of over $20 billion. And based on Java, the leading programming language, and as of this date no other major ERP vendors system is based upon. In terms of technological architecture this will provide a foundation for the innovative oil and gas producer through the next several generations or iterations of the inevitable IT churn.
The user base for People, Ideas & Objects needs to be as broad as is possible. What is clear in this discussion is the role that the service industry providers have in making this application so much more valuable through their interaction. So whether it is a producer, service industry representative or participant in a Joint Operating Committee, a geologist, engineer or accountant, everyone and everybody needs to be included in making the People, Ideas & Objects Preliminary Specification theirs.
One module that the oil and gas producer and the Joint Operating Committee won’t have much use for is the Oracle Fusion Customer Relationship Management Suite or CRM. That doesn’t mean that we won’t host the applications as the benefits of doing so would be the better service the service industry could provide the producers and JOC’s by having access to those application modules. Customers are a bit of a foreign concept in oil and gas, not so in the service industry, and the ability to have access to the Oracle Fusion Customer Relationship Management Suite would provide real value for both the service and the oil and gas industry.
Included in the suite are the following modules. Customer Master, Sales, Marketing, Incentive Compensation, Mobile & Outlook Integration and Territory and Quota Management. These applications help to manage the customer, that being the oil and gas producer and Joint Operating Committee, with their needs for the service industries products and services. Applications such as Oracle Fusion Product Catalog allow service industry marketing personnel to start the process of selling and promoting their products on the web. From there they are able to capture the sales leads and track down sales calls to make the sale with the information that is captured by their team within the Oracle Fusion CRM Suite.
Providing these products in the Preliminary Specification is a must have and therefore I have included them in the Resource Marketplace module. The service industry needs are a critical component of the success of the innovative oil and gas producers. Although we are not as confident in terms of understanding their business. And their businesses are far more diverse in terms of the industry definitions that define them. We need to provide the best software services that we can to the services industry. This from a reasonableness and competitiveness point of view, but also to mitigate the conflict that has arisen between the producers and service industry representative in terms of costs and performance.
Customer Relationship Management applications have become one of the killer apps of the last decade in terms of their impact on business. Bringing a level of intelligence to the marketing of products and services to the firms that are able to exploit the technologies.
In all of the modules of the Preliminary Specification we have defined high levels of collaboration. Whether it is here in the Resource Marketplace modules Actionable Information Interface, Supplier Collaborative Interface or the Gap Filling Interface. Collaboration within the producer, Joint Operating Committee, oil and gas industry and service industry is robust. Now some of those collaborations, like those in the Supplier Collaborative Interface are for public consumption. And others are for a limited viewing audience. How can users be assured that their collaborations are held in the confidence they are intended to be? And what form will these collaborations take, and what systems are used in order to conduct these interactions? These are all valid questions that will be answered by this discussion.
Today’s collaborations take on much more than just textual interactions. There is video, chat, social media and images. Within the Preliminary Specification I would like to see the ability to capture a video meeting of the Joint Operating Committee and record the participants and their votes for further reference. This way members could be situated where ever they may be at the time of the meeting and still participate through their computer or an iPad. Being presented with a menu of items in which the voting on different decisions that are being made. Their votes being logged and the outcome of the votes setting in motion the activity that was decided upon.
Oracle through their Fusion Applications provides these level of collaborative services as part of the ERP software offerings. It will not be necessary for the members of the Joint Operating Committee to go outside of the People, Ideas & Objects application modules to gain this level of collaboration. It will be available as a result of the application itself. The following quotations come from a white paper entitled “Oracle Fusion Application Overview”
It is within this area of collaborations that innovations will begin. In our review of Professor Giovanni Dosi we learned that technical trajectories were influenced by commodities that were abundant and affordable. It is People, Ideas & Objects assertion that the two commodities that affect the technical trajectories in oil and gas are knowledge and collaborations. Having an ERP system that provides high levels of collaboration will enhance the innovativeness of the oil and gas producer. And let's not forget the ultimate collaborative interface, our “Marketplace Interface”.
In previous passes through the Preliminary Specification we have discussed the Purchase Order system that is part of the various modules. In the Resource Marketplace module, access to the service industry is one of the key attributes of the module and therefore the Purchase Order system will be an inherent part of that module. Thankfully Oracle have a suite of modules called Procurement in the Oracle Fusion Applications. Within that suite includes the following modules Purchasing, Self-Service Procurement, Sourcing, Procurement Contracts, Supplier Portal and Spend & Performance Analysis. All of these modules within the Procurement suite will be adopted within the Preliminary Specification as they bring substantial value to the innovative oil and gas producer.
There is also a suite of Supply Chain Management modules that I have not placed within the Preliminary Specification. Oil and gas doesn’t need supply chain management tools it needs good old fashioned purchasing tools. Supply chain tools are for retail stores like WalMart and manufacturers like Ford, not oil and gas operations like upstream innovative oil and gas producers. There may be some demand for supply chain tools if the producers of the oil sands plants decide to join the People, Ideas & Objects Preliminary Specification, and there is no reason that they couldn’t. They would however need to indicate so before the scope of the Preliminary Specification was set, so that it included heavy oil operations.
There will be a variety of People, Ideas & Objects modules that access Oracle Fusion Application Procurement modules during their operation. Within the Preliminary Specification we have employed modularity theory in both the technology and the organizational design. From a technological point of view modularity provides us with the ability to access the services of a module without having to delve too deeply into the code of the module we want to access. In a paper entitled “Oracle Fusion Applications: The New Standard for Business” Oracle describes the benefits of modularity in the following fashion.
The maximum benefits of SOA can only be gained by placing services at the heart of an application that takes a modular approach to module and process design. That way, processes can be reconfigured to meet the evolving requirements of the business at a detailed level. Any extensions can be developed as additional services, without touching the source code of the core application.
So when the Resource Marketplace module wants the “Marketplace Interface” to generate a Purchase Order with a new supplier then the service is populated within the interface from the Purchasing module in the Oracle Fusion Application Procurement Suite. These are some of the benefits that we gain from modularity in terms of the technologies. What the primary benefit of modularity is in organizations is the further division of labor and specialization.
Purchasing activities may be limited to those producers that are undertaking large and complex projects. However, I think that any and all producers can benefit from having these services available to them. Even though a project may not be big in terms of some of the other projects that are undertaken in the industry, they are material to the producer firm or Joint Operating Committee conducting them. And as such would benefit by having a Purchase Order system and related facilities provided to help manage the contract, transaction and relationship with the service industry provider.
The Preliminary Specification provides the oil and gas producer with the most profitable means of oil and gas operations. People, Ideas & Objects Revenue Model specifies the means in which investors can participate in these user defined software developments. Users are welcome to join me here. Together we can begin to meet the future demands for energy.
Looking at the Oracle Fusion Applications from the perspective of the Resource Marketplace module it is easy to see where we can start. In the Preliminary Specification so far we have not discussed what is traditionally been called the Human Resource or Human Capital area of the firms needs. This of course would fall under the Resource Marketplace module as these people are part of the Resource Marketplace. Oracle has a number of products that fall under this category in their Oracle Fusion Applications and we will discuss them here. I noticed this quotation that shows we are consistent with Oracle’s approach to the marketplace in terms of how their Oracle Fusion Applications are to be used.
Oracle Fusion Human Capital Management is part of Oracle Fusion Applications, which are completely open, standards-based enterprise applications that can be easily integrated into a service oriented architecture. Designed as a complete suite of modular applications, Oracle Fusion Applications help you improve performance, lower IT costs, and get better results. Whether you choose one module, a product family, or the entire suite, Oracle enables you to gain the benefits of Oracle Fusion Applications at a pace that matches your business needs.
I read this as consistent with our intent to use Oracle Fusion Applications in the following manner. That they are open to customization through the Oracle Fusion Middleware layer. They are standards based and can be used as a service oriented architecture which is another term for “cloud” computing. Lastly we are an Oracle customer that “fills the gap” between the oil and gas industry and the technologies that Oracle provides.
The first document that I want to look at is a brochure that was published by Oracle entitled “Oracle Fusion Human Capital Management: The New Standard for Human Capital Management.” Within it Oracle lists the fifteen applications that fall under the Human Capital Management Suite.
The first and summarizing paragraph of the brochure shows that we are in the same ball park and playing the same sport as Oracle with respect to the Military Command & Control Metaphor (MCCM). Although our concept has been developed further to include multiple organizations in the Joint Operating Committee and the service industry, they have developed the concept within the standalone organization to a significant level.
Oracle Fusion Human Capital Management (HCM) is a revolutionary step in human resources. The core design principle of Oracle Fusion HCM empowers every role in the organization, connecting all segments of a global workforce. It allows organizations to inform, engage, and collaborate with their workforce in ways never before possible. Organizations will benefit from the ability to personalize the application at organizational, business unit, management, and individual levels. These capabilities are fully configurable; are supported out of the box; and ensure data consistency, security, and compliance globally
Reading their documentation I see this emphasis on role throughout, which is a necessary part of the MCCM, and being a critical part of their application suites. Having that functionality already there will be a strong first step in making the MCCM real.
One area that we had not touched on yet was payroll, after all everyone likes to get paid. And of course the Oracle HCM Suite provides for these services. What will need to be done is to ensure that the earth science and engineering, as well as any other human resources that are being charged to the joint account, are able to be charged and recovered through the payroll system. I would think that this is something that Oracle would have thought would be basic functionality however I have not stumbled upon it yet. Recall that it is necessary, as a part of a producer's value proposition, that they seek revenues from oil and gas sales, and, from the secondment of their technical resources to the Joint Operating Committees, research and industry at large. The demands for earth scientists and engineers being so great, the costs to develop a team will be too onerous without the ability to generate revenues from them. Therefore a payroll or Partnership Accounting module facing system that bills these resources to the joint account and elsewhere at various rates will be necessary for the innovative oil and gas producer.
I’m intrigued by a grouping of modules within the Oracle Human Capital Management Suite (Oracle HCM Suite) that are somewhat new and provide the innovative oil and gas user with some unique value. Oracle calls this group of modules Oracle Fusion Talent Management which includes the following modules from the Oracle HCM Suite. Compensation Management, Incentive Compensation, Performance Management, Goal Management, Workforce Directory Management, Network at Work and Talent Review. I think that it is worthwhile to place the entire Oracle HCM Suite within the Preliminary Specification. That way producers, Joint Operating Committees and service industry participants will be able to use the modules that they find meets their needs in the most appropriate manner. Recall that People, Ideas & Objects will be providing the software in a “cloud computing” environment which is consistent with the architecture that Oracle has developed their Fusion Applications under.
The purpose in having a Talent Management grouping of applications should be obvious. In oil and gas we have a particular issue with the earth science and engineering resources that are the critical resource of the industry. The expected retirements over the next 20 years, the ability to train new recruits within that time, the increasing requirement of geology and engineering in each barrel of oil, and the expected demand for energy all make these people part of the key competitive advantages of an innovative oil and gas producer. Having software that focused on developing and maintaining these resources would be of great assistance, so lets have a quick look at what Oracle has prepared in terms of Oracle Fusion Talent Management.
First of all it is an assumption that the majority of these resources will be directly employed by the producers themselves. They will be seconded to the individual Joint Operating Committees by the producers that employ them, much as they do today. The employment contract will in all likelihood be comprehensive and include incentive and bonus compensation based on performance. With that said Oracle has three specific compensation related modules in their Talent Management group, Compensation Management, Incentive Compensation and Performance Management. These applications allow the producer to look at the compensation from the global and strategic perspective and from the competitive landscape. Particularly within the geographic region in which they are competing. In areas such as Performance Management the employee has tools in which to guide them through what is expected of them to keep them on course and attaining their goals.
Speaking of goals there is Oracle Goal Management for the producer to establish goals for the organization and individuals within that organization. In a top down manner the goals of the organization can be pushed down to the individual units and groups, and finally to the individuals to achieve within the appropriate time frame. There is also a capability in which employees are able to document their career development.
Oracle Network at Work is a tool that establishes a social network within the confines of the organization. I would think this might be of value if we had it for the entire oil & gas and service industries. Then the whole industry could collaborate and share the information they would share within a social network. The feature that this would have is that it would be dedicated to oil and gas as opposed to facebook which is unfocused.
How about a software tool to evaluate and prepare for the employee review process. In addition this is in a collaborative environment so that the input of the people who are responsible for the individuals performance have input into that process. The Oracle Fusion Talent Review does this and helps you develop the right talent for the right jobs.
The Oracle Fusion Workforce Directory Management provides a graphical representation of the organization chart. This is something that we need for the Military Command & Control Metaphor. The need to extend this beyond the individual organization to include members of the Joint Operating Committees participating producers and service industry representatives would be necessary. The tool provides basic information, including the role the individual holds, their supervisor etc. Exactly what we need in order to begin to impose a chain of command within the temporary organization that is established for operational excellence in the Joint Operating Committee.
Oracle has published a paper entitled “HR in the Cloud: Bringing Clarity to SaaS Myths and Manifestos” that I want to review. It deals with the issues around hosting the Oracle Human Capital Management Suite of applications in a “cloud computing” environment. Since all of Oracle applications are deployable to the cloud, and People, Ideas & Objects will be hosting the Preliminary Specification in that environment, review of this paper will bring some insight into the needs of our software. It's important to note that Oracle is the world's second largest SaaS (Software as a Service) provider, with 5.5 million users worldwide.
It is proposed in the Hardware Policies & Procedures for People Ideas & Objects that the application derived from the Preliminary Specification will be run on a “Private Cloud.” The ownership and management of this organization is subject to the industries input for the purposes of their compliance to SEC and other regulations. Having the application served as a SaaS, as single-tenant, and on a Private Cloud denotes most of the architecture that the application will have to consider.
In a survey Oracle identified that the two most common business processes run on private clouds are Financial / Accounting @ 20%, and Human Resources / Benefits @ 19%. I think the Financial / Accounting category was largely underreported in the survey as there was also Home Grown Applications @ 16%, Inventory / Shipping @ 10%, and Procurement / Purchasing @ 11%. All three of these are probably or traditionally accounting related applications. Making for a total of 76% of the total of all cloud based applications. Clearly the cloud is being used for the purposes that People, Ideas & Objects is planning to use them for.
It is too early to evaluate the proposed People, Ideas & Objects solution on the basis of Total Cost of Ownership from the perspective of a producer. There are not enough facts available to make any decisions or valuable information that would hold up under scrutiny. The oil and gas producer is in a capital intensive business where the costs of ERP systems are not material to the bottom line of the enterprise. The value proposition that is offered in our Revenue Model provides the oil and gas producer with the most profitable means of oil and gas operations.
We have looked at the Oracle identity management and security offerings and included them within the Security & Access Control module of the Preliminary Specification. From a SaaS perspective these tools also provide further value in that privacy laws in the EU and other areas outside of the U.S. are covered by Oracle’s database, identity management and security solutions.
We continue with our discussion of the Oracle paper “HR in the Cloud: Bringing Clarity to SaaS Myths and Manifestos.” Needless to say they’re large technical issues and there will be those that won’t be satisfied with the solutions no matter what the outcome of the Preliminary Specification. It is important to note that many of these features are available only as a result of providing People, Ideas & Objects as a “single-tenant” solution. This is the superior methodology and is the manner in which we are able to provide much of the customization of the Oracle technologies.
Integration of software is where many of the problems show up. We need to maintain a focus on the user to ensure that we are meeting their needs. And to continue to develop the Community of Independent Service Providers that are there to service and support the People, Ideas & Objects software for the producers. Oracle suggests that developing on open standards like Java and Oracle Fusion Middleware allows for further upgrade of the technology even if there are customizations. This little bit of magic will be discussed further as we proceed through the Preliminary Specification. It is however as a result of everything that is contained within the Oracle Fusion Applications are derived from the Oracle Fusion Middleware layer.
Customizations of applications are a fact of life. Not everyone can fit within the standard configuration of what an application should be. The reliance on users helps to keep the focus of where the needs are, and customizations through a dedicated software development capability like that proposed by People, Ideas & Objects are necessary. In addition each producer is unique. The need to have each producer run their own version of the Oracle stack of technologies and the People, Ideas & Objects software in their own virtualized instance on the cloud computer is necessary. This is what is called “single-tenant.” Then each producer is running their own version of the software and their domain is somewhat under their control.
Through the use of Oracle Fusion Middleware these customizations, if done appropriately, will survive the upgrade process. Therefore the ability to have the regular software upgrades of the underlying Oracle technologies will not disrupt the People, Ideas & Objects modules or customizations. Speaking of upgrades the need to manage the upgrade process for cloud computing applications takes on a new priority. Making sure that the appropriate change management procedures and policies are in place, the appropriate testing, that training of the user base and a host of other related issues need to be considered before the technologies are upgraded. It will be easier to upgrade the technologies once, however it must be done with much forethought and consideration of the producers and users needs and understanding of the use of the application modules.
When it comes to performance and reliability the cloud computing architecture is a simple matter of applying the proven rules of specialization and the division of labor. It is far more efficient and effective to have the technologies for hundreds of producers handled by the specialized skills of Database Administrators, Network Specialists and the like then having each of those producers provide support for their technical architecture with one general support person.
One of the key outputs of the Preliminary Specification is the initial geographical scope of the People, Ideas & Objects application modules. This will involve which jurisdictions it will calculate royalties for, which jurisdictions it will meet for securities purposes, and what currencies it will recognize etc. In essence determining the minimum level of functionality to meet the users requirements in the first commercial iteration of the application. Oracle Fusion Applications are global in their scope. Providing the producer with a strong base of functionality in which to determine what is the initial scope of the Preliminary Specification.
Within the Resource Marketplace module of the Preliminary Specification there is a need to provide the service industry participants with software solutions that interact with the producers and Joint Operating Committees. In the area of Human Capital Management, a part of the Resource Marketplace module which the Military Command & Control Metaphor will fall under. Where members of the service industry firms participate in field operations conducted by the Joint Operating Committees. They need to have the ability to participate and fall-in within the chain of command that is established within the temporary organization that is established for the operation being conducted. Therefore the need to access some of the modules of the Oracle Fusion HCM Suite, as well as others, will be part of the Preliminary Specifications offering as well.
And there will be other aspects of the service industry representatives business that will need to be included in the Preliminary Specification. Looking at Oracle’s Fusion Financials and Oracle Accounting Hub there are services that are provided for just this purpose. Recall that we have some unique aspects of the Resource Marketplace module that involve the service industry. And one of those is the ability to design transactions. Therefore the need to have these software services operational in the cloud and accessible by the service industry representatives is critical.
It is not to suggest that we are providing the full accounting services that we are providing to the producer firm and Joint Operating Committees. We are not that familiar with the service industry to provide that level of service. However, Oracle Fusion Accounting Hub provides the means in which they can interface their accounting systems with the People, Ideas & Objects systems. That way they can utilize the services we provide and fully integrate their systems to service and support the innovative oil and gas producer and Joint Operating Committee in its needs.
Modules of the Oracle Fusion Financials include General Ledger, Accounts Payable, Accounts Receivable, Payments & Collections, Cash & Expense Management and Asset Management. These are your generic financial applications and will of course be included in the Preliminary Specification. Where they reside within the specification is not material to the discussion as they will be separate modules much like the eleven modules in the Preliminary Specification. By using modular theory we gain the full use of these Oracle Fusion applications without the complexity of integrating them within any specific module itself.
The days in which we could generate excitement over charts of accounts and journal entries is probably behind us. The ability to deal with the unique needs of the Preliminary Specification is something that I am confident that Oracle Fusion Financials can handle. Based on the Oracle Database, which is by far the leading technical database and market leader. And the result of what Oracle claim to have now invested in Fusion technologies since 2005 of over $20 billion. And based on Java, the leading programming language, and as of this date no other major ERP vendors system is based upon. In terms of technological architecture this will provide a foundation for the innovative oil and gas producer through the next several generations or iterations of the inevitable IT churn.
The user base for People, Ideas & Objects needs to be as broad as is possible. What is clear in this discussion is the role that the service industry providers have in making this application so much more valuable through their interaction. So whether it is a producer, service industry representative or participant in a Joint Operating Committee, a geologist, engineer or accountant, everyone and everybody needs to be included in making the People, Ideas & Objects Preliminary Specification theirs.
One module that the oil and gas producer and the Joint Operating Committee won’t have much use for is the Oracle Fusion Customer Relationship Management Suite or CRM. That doesn’t mean that we won’t host the applications as the benefits of doing so would be the better service the service industry could provide the producers and JOC’s by having access to those application modules. Customers are a bit of a foreign concept in oil and gas, not so in the service industry, and the ability to have access to the Oracle Fusion Customer Relationship Management Suite would provide real value for both the service and the oil and gas industry.
Included in the suite are the following modules. Customer Master, Sales, Marketing, Incentive Compensation, Mobile & Outlook Integration and Territory and Quota Management. These applications help to manage the customer, that being the oil and gas producer and Joint Operating Committee, with their needs for the service industries products and services. Applications such as Oracle Fusion Product Catalog allow service industry marketing personnel to start the process of selling and promoting their products on the web. From there they are able to capture the sales leads and track down sales calls to make the sale with the information that is captured by their team within the Oracle Fusion CRM Suite.
Providing these products in the Preliminary Specification is a must have and therefore I have included them in the Resource Marketplace module. The service industry needs are a critical component of the success of the innovative oil and gas producers. Although we are not as confident in terms of understanding their business. And their businesses are far more diverse in terms of the industry definitions that define them. We need to provide the best software services that we can to the services industry. This from a reasonableness and competitiveness point of view, but also to mitigate the conflict that has arisen between the producers and service industry representative in terms of costs and performance.
Customer Relationship Management applications have become one of the killer apps of the last decade in terms of their impact on business. Bringing a level of intelligence to the marketing of products and services to the firms that are able to exploit the technologies.
In all of the modules of the Preliminary Specification we have defined high levels of collaboration. Whether it is here in the Resource Marketplace modules Actionable Information Interface, Supplier Collaborative Interface or the Gap Filling Interface. Collaboration within the producer, Joint Operating Committee, oil and gas industry and service industry is robust. Now some of those collaborations, like those in the Supplier Collaborative Interface are for public consumption. And others are for a limited viewing audience. How can users be assured that their collaborations are held in the confidence they are intended to be? And what form will these collaborations take, and what systems are used in order to conduct these interactions? These are all valid questions that will be answered by this discussion.
Today’s collaborations take on much more than just textual interactions. There is video, chat, social media and images. Within the Preliminary Specification I would like to see the ability to capture a video meeting of the Joint Operating Committee and record the participants and their votes for further reference. This way members could be situated where ever they may be at the time of the meeting and still participate through their computer or an iPad. Being presented with a menu of items in which the voting on different decisions that are being made. Their votes being logged and the outcome of the votes setting in motion the activity that was decided upon.
Oracle through their Fusion Applications provides these level of collaborative services as part of the ERP software offerings. It will not be necessary for the members of the Joint Operating Committee to go outside of the People, Ideas & Objects application modules to gain this level of collaboration. It will be available as a result of the application itself. The following quotations come from a white paper entitled “Oracle Fusion Application Overview”
Web 2.0 Collaboration: Today’s workforce relies on online collaboration to get their work done. Whether they use chat, discussion forums or web conferencing to communicate and come to decisions, Web 2.0 collaboration technologies have previously been disconnected from enterprise applications. Integrating Web 2.0 Collaboration directly within the application has several benefits:
- Productivity: Instead of searching for the relevant employee in a separate online directory, initiating a session through a separate Web 2.0 application, a Web 2.0-aware enterprise application can provide a direct link to the other participants in the decision, and single-click access to online communications with them.
- Context: A Web 2.0-aware application can integrate the business context with the discussion, and capture the decision details for future reference.
- Security: The channels that the application offers directly are sanctioned and secure, in contrast to the third-party programs that employees commonly use for non-professional communications.
It is within this area of collaborations that innovations will begin. In our review of Professor Giovanni Dosi we learned that technical trajectories were influenced by commodities that were abundant and affordable. It is People, Ideas & Objects assertion that the two commodities that affect the technical trajectories in oil and gas are knowledge and collaborations. Having an ERP system that provides high levels of collaboration will enhance the innovativeness of the oil and gas producer. And let's not forget the ultimate collaborative interface, our “Marketplace Interface”.
In previous passes through the Preliminary Specification we have discussed the Purchase Order system that is part of the various modules. In the Resource Marketplace module, access to the service industry is one of the key attributes of the module and therefore the Purchase Order system will be an inherent part of that module. Thankfully Oracle have a suite of modules called Procurement in the Oracle Fusion Applications. Within that suite includes the following modules Purchasing, Self-Service Procurement, Sourcing, Procurement Contracts, Supplier Portal and Spend & Performance Analysis. All of these modules within the Procurement suite will be adopted within the Preliminary Specification as they bring substantial value to the innovative oil and gas producer.
There is also a suite of Supply Chain Management modules that I have not placed within the Preliminary Specification. Oil and gas doesn’t need supply chain management tools it needs good old fashioned purchasing tools. Supply chain tools are for retail stores like WalMart and manufacturers like Ford, not oil and gas operations like upstream innovative oil and gas producers. There may be some demand for supply chain tools if the producers of the oil sands plants decide to join the People, Ideas & Objects Preliminary Specification, and there is no reason that they couldn’t. They would however need to indicate so before the scope of the Preliminary Specification was set, so that it included heavy oil operations.
There will be a variety of People, Ideas & Objects modules that access Oracle Fusion Application Procurement modules during their operation. Within the Preliminary Specification we have employed modularity theory in both the technology and the organizational design. From a technological point of view modularity provides us with the ability to access the services of a module without having to delve too deeply into the code of the module we want to access. In a paper entitled “Oracle Fusion Applications: The New Standard for Business” Oracle describes the benefits of modularity in the following fashion.
The maximum benefits of SOA can only be gained by placing services at the heart of an application that takes a modular approach to module and process design. That way, processes can be reconfigured to meet the evolving requirements of the business at a detailed level. Any extensions can be developed as additional services, without touching the source code of the core application.
So when the Resource Marketplace module wants the “Marketplace Interface” to generate a Purchase Order with a new supplier then the service is populated within the interface from the Purchasing module in the Oracle Fusion Application Procurement Suite. These are some of the benefits that we gain from modularity in terms of the technologies. What the primary benefit of modularity is in organizations is the further division of labor and specialization.
Purchasing activities may be limited to those producers that are undertaking large and complex projects. However, I think that any and all producers can benefit from having these services available to them. Even though a project may not be big in terms of some of the other projects that are undertaken in the industry, they are material to the producer firm or Joint Operating Committee conducting them. And as such would benefit by having a Purchase Order system and related facilities provided to help manage the contract, transaction and relationship with the service industry provider.
The Preliminary Specification provides the oil and gas producer with the most profitable means of oil and gas operations. People, Ideas & Objects Revenue Model specifies the means in which investors can participate in these user defined software developments. Users are welcome to join me here. Together we can begin to meet the future demands for energy.
