Let's face it, what are CRM systems really? At their core, they are composed of a database with some applications specific to a workflow. Likewise, what are human resources systems? Ditto.Financial management systems? They use spreadsheets with some applications to a specific workflow.And what better system to handle these types of applications? A database.The latest acquisition by Oracle was no big surprise; Ellison had all but telegraphed this move.
And now, what is the impact of this acquisition on location-based information management? What you are now seeing is the potential to integrate location technology into several business processes on one platform: CRM, BI, ERP.For a reason why you would want to do that, let me mention a quote from ESRI president Jack Dangermond who spoke at the company's Homeland Security conference this week.In reference to the geospatial information gathering process necessary for Hurricane Katrina's rescue and recovery efforts, he said, "We're not very good at bringing all this together now - we're maybe pretty good at it if you look at it one city at a time.But I have a vision that we could be good at it across the nation at some point in the future." If he is talking about being able to access information from a single repository of spatial information, then without playing the "interoperability card" of standards and Open Geospatial Consortium specifications, I suggest that a single database platform would be a significant advantage.
If you were a CIO and had a variety of business process management tools and platforms scattered throughout your enterprise, I'd be looking at this with my eyes wide open.The impetus to move to an Oracle platform that can utilize an integrated suite of solutions (at least I suspect that is the plan for Siebel software), although not without its risks, has obvious advantages.Oracle's purchase of Siebel gives the company a treasure trove of BI tools that could easily be spatially enabled.In a 2003 report issued by Ventana Research, a research partner of Directions Media, Mark Smith, CEO wrote, "We believe Siebel's aggressive moves in the BI market will have direct impact on the other major BI vendors including Business Objects, Cognos, Hyperion, Information Builders and MicroStrategy.Many of these BI vendors are still working through acquisitions that prevent them from having an integrated server environment for BI.Unlike other CRM and ERP providers that have not made BI or Performance Management a management priority, Siebel has a direct field organization with sales, pre-sales and field marketing dedicated to BI who have experience and knowledge in navigating this market.This provides new challenges for the ERP and CRM providers - Oracle, PeopleSoft and SAP as Siebel's next generation BI platform breaks through many of their database, partner or data warehouse centric approaches."
Once threatened by Siebel's innovation, Oracle has, in one move, developed additional market penetration in the BI marketplace where competitors are itching to find additional functionality, like spatial analysis, to leverage with prospective customers.All of the vendors mentioned above have relationships with GIS vendors: Hyperion and Information Builders have partnerships with ESRI; MapInfo is collaborating with Microstrategy and Business Objects.SAP now finds itself at a significant disadvantage in terms of the location intelligence (LI) marketplace as it has no inherent spatial tools other than integrating with ESRI software.But I suspect the company may not care at this time; they look at bigger business integration problems other than spatial information management.But, Oracle has put pressure on the GIS vendors because they no longer offer a competitive alternative through their strategic partnerships with BI companies.
Where does this leave IBM and Microsoft? I suspect this is a reality-check for them, but again each company has different business models: IBM is essentially an integrator; Microsoft is playing into more of the consumer and small to medium size business marketplace.The Wall Street Journal reports that Oracle is number three in terms of total software revenue compared to the other two companies but lags only SAP in business applications programs.However both IBM and Microsoft have never made spatially enabling their databases a priority; both will need to rethink their strategy in terms of providing enterprise solutions to customers, because Siebel considered both companies strategic partners to implement its solutions.These relationships, I suspect, will diminish as the acquisition becomes complete.
In the LI marketplace specifically, Oracle continues to build mindshare.IBM, Microsoft, and SAP are left to play catch up with every acquisition that Oracle makes.LI is growing too fast to ignore, however.The explosion of location technology through consumer applications is propelling the enterprise space into action, or more aptly, reaction.