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"Frankly, we'd be a bit surprised if Oracle didn't win the Computerworld Hong Kong database award," said Paul Lee, senior director of sales consulting, database technology, Oracle greater China. But, as Lee and his colleague Toa Charm, general manager of BI, Oracle greater China pointed out, the firm is now known for other products, as evidenced by its CWHK Award wins for CRM, BI (business intelligence), OLAP and data mining.
Research firm IDC concurs. A March 2007 IDC report said that "the relational database management systems (RDBMS) market perked up in 2006, showing some vigor, even in unexpected places." Among IDC's key findings for 2006: Oracle increased its lead to 44.4 percent market share and outpaced the market as its revenue jumped 14.7 percent over 2005.
"Oracle continued to glide along in first place, bolstered by apparently broad acceptance of the 10gR2 release and the success of key options", said Carl Olofson, research VP for application development and deployment, IDC. Olofson also noted that Oracle has "shown strong growth in new sites among small and medium-sized business (SMB) customers." |
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The IDC report pegged three main reasons for Oracle's growth:
• Broad acceptance of Oracle Database 10g Release 2 and the success of its options
• Strong growth in small and medium business
• Server upgrades generating the purchase of additional licenses
"Oracle is integrating the stack from the iron up to and including the application," wrote Olofson. "Oracle enjoyed substantial growth due to the success of some of its database options and has also shown strong growth in new sites among small and medium-sized business (SMB) customers."
"It should also be noted that additional license purchases due to processor- (or core-) related upgrades also helped drive Oracle's license revenue growth," said the IDC report.
Olofson is bullish on the future of the RDBMS market: "The large vendors are exploiting new markets in Asia-Pacific while simultaneously mining opportunities with smaller customers and with the sales of new features and tools to existing customers," he wrote. "Technology innovations are afoot that could disrupt this process, but the impact of such innovations is only very subtle at the moment."
Compliance issues
"Business in Hong Kong is different from business in China," said Lee, who added that he now spends the bulk of his work-time on the mainland. "The prime motivator of Chinese companies is to increase their market share, because competition is opening up from both domestic and international vectors."
Lee said that China's Tier 1 financial sector was the first to open up, but now the insurance sector-along with Tier 2 banks and RCCUs (Rural Credit Cooperative Unions)-is following suit. "These firms are domestic, regional...they're chasing the same customer base. Bigger SOEs (state-owned enterprises) like the Chinese Ministry of Railways are also part of this equation. As their efficiency is not currently high, competition will drive business."
The Oracle senior director said that RCCUs are becoming common in China. "We have closed major database deals with the Guangxi RCCU and the Heilongjiang RCCU," he said.
R&D and China expansion
Oracle opened its Shenzhen R&D center in 2002, followed by another facility in Beijing 2003. But now, according to Lee, "we've moved to a networked concept of development centers." Lee said that the Shenzhen and Beijing facilities are now linked into a network with regional Oracle R&D centers in Singapore, Bangalore and Seoul, collectively known as the OARDC (Oracle Asia Research Development Center)."
"The number of offices we operate in greater China is expanding tremendously," said Charm. "Eventually we plan to be operating in 20-22 [Chinese] cities-not just sales offices, but full-function offices planned."
Acquisition strategy
"Our acquisitions are driven by innovation," said Lee. "When we acquire a company, we're looking for innovation rather than competition or market share. Market dynamics don't allow us to innovate fast enough, so that's what we're looking for."
One of Oracle's more significant acquisitions of the last few years-Siebel-is directly responsible for one of their award-wins (for Oracle Siebel CRM and CRM On Demand). But Charm also pointed out that their more recent acquisition of Hyperion is helping Oracle's BI strategy.
Intelligent business
"Hong Kong is a mature market for IT," said Charm, "and BI is the killer app in a mature market." Charm said that the Asia-Pacific market was responsible for 14% of his firm's overall growth this year, adding that BI was a "prime sector."
According to Charm, Oracle's BI strength is due to four areas:
1 Tools: consolidation-of-market in this area.
2 Apps: transactional and analytical, in the areas of CRM, ERP and SCM. Charm noted that many of these apps originated from acquired companies PeopleSoft and JD Edwards, and prebuilt dashboards create market differentiation.
3 Industry-specific apps: "Whether it's a telco, retail, banking/financial or energy company," said Charm, "they want to know their KPIs (key performance indicators), and we offer [dashboards] pre-built for vertical industries." (See sidebar: Towngas cleaves to Oracle Siebel CRM").
4 Pervasive use: "Previously," said Charm, "BI was used in a departmental 'silo' manner. Now that's changing, with our largest customers wanting to standardize enterprise-wide, all on top of best-of-class middleware."
"We are receiving good feedback from all market-sectors," said Charm, "and we offer a full spectrum based on the BIEE (Business Intelligence Suite Enterprise Edition)."
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Towngas cleaves to Oracle Siebel CRM
The Hong Kong and China Gas Company Ltd-better known as Towngas-distributes natural gas to more than 1.5 million customers throughout Hong Kong. Towngas was the first public utility in Hong Kong and the first gas utility in the region.
In Hong Kong, Towngas has more than 3,000 kilometers of pipeline network, more than 1.5 million customers, and almost 2,000 employees. Its core business includes the production and distribution of gas, marketing of gas appliances, and comprehensive after-sales services. In recent years, Towngas has diversified into various green businesses including liquefied petroleum gas filling stations and utilization of landfill gas. It's also developing its gas business in mainland China.
Towngas sets quantified targets for service quality and conducts independent customer surveys to review its performance. In a rapidly expanding business environment, Towngas decided to replace a costly customer information system with a Oracle's Siebel CRM for Energy (specifically designed for organizations in the energy and utility industries) to manage its customer and field service operations.
"We required a system capable of managing all customer and field service activities-capturing service calls and orders, handling appointment booking, and coordinating the dispatch of technicians and external contractors for greater fulfillment of field services, including emergency activities," said Tony Yeung, head of Information Technology, Towngas. "By better knowing our customers, we can offer them better services and transform service calls into cross-selling opportunities."
According to Oracle, the new system enables Towngas to manage all aspects of service operations across the call center, sales outlets, field sales, and field service. In addition to lowering system maintenance costs, Siebel CRM for Energy allows Towngas to provide superior customer service, support effective marketing, and improve cross-selling and up-selling initiatives.
For requests related to appliance ordering, installation, or maintenance, customers can communicate with Towngas through the channel of their choice, including the Web, call center, or face-to-face interaction, according to Oracle. By providing a complete view of each customer's history, Siebel CRM for Energy enables Towngas to respond quickly and effectively-recommending the best product, scheduling the visit of a qualified company technician or third-party contractor, and providing field agents with all the information they need to deliver exceptional service.
The system also stores completed work information, creating a closed loop flow of information that enables Towngas to improve its service processes, said Oracle. Towngas has a staff of more than 410 customer service agents, including third-party contractors, as well as more than 380 field service technicians and field service contractors.
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