As any experienced observer of our industry knows, the weaker the message a software company has on offer, the higher in the corporate hierarchy it has to go to deliver it. Oracle did not fail the tradition as a posse of vice-presidential bigwigs led by the head of its HCM development organization, descended a couple of weeks ago upon the City of Light (the home of yours truly) as part of their Fusion global roadshow.
The stakes are high. As soon as Oracle finalized its acquisition of PeopleSoft in 2005, it announced it was starting work on the successor product. Although I was among many chagrined by the demise of the jewel in our industry, I couldn't really blame Oracle: from a purely business perspective it didn't make sense to keep having several parallel products. Four years later, in 2009, there was still no Fusion on the horizon but Larry Ellison, rarely detracted by reality, famously announced that Fusion was going to be the SuccessFactors and Workday killer. More than two years later (almost six years after first announced) and with scores of Oracle and PeopleSoft customers defecting to SuccessFactors and Workday, where is Fusion?
When it was demoed at the HR Technology Conference in Chicago a year ago (see my post on it) release was announced for early 2011. Then it was pushed to the second quarter of 2011 and only in the summer was "something" finally made available.
First comment: the product is available for download, putting to rest any notion that it is SaaS-based. As anybody with a modicum of interest and knowledge in the matter knows, if you can install it on your server then it is NOT SaaS. Call it a hosted solution and the vendor an ASP or whatever alphabet soup you feel comfortable with, but SaaS it sure ain't. Also, the price list for Fusion is only available for the on-premise implementation, not the "cloud" variant which Oracle claims it has: another proof of how fuzzy and half-baked this mock-SaaS offering is.
Second, if I used "something" to describe the scope of what is available, it is not to belittle the hard work that went into it (and I know that many people did work hard on it), but it is an honest description of the functionality which is mainly based on compensation, one component of talent management, itself just one part of any overall HCM offering. Where is recruiting? (Wouldn't Fusion have been a great opportunity for Oracle to fix the double failure of its Oracle iRecruit and PeopleSoft eRecruit products?) And Learning/development? and Succession planning?
Who in their right mind would believe for a second that SuccessFactor has anything to fear from a product with such limitations? And as for Workday, it started work on their ground-breaking product at the same time as Fusion with $100 mn in seed money (Oracle makes profits in the billions), and a few dozen employees (Oracle has a cast of thousands working on Fusion - and, as few people know, this was supplemented by resources from Indian IT giant Infosys). As of today, Workday has not only delivered an entirely new HR system of record, two payrolls, strong talent functionality (even if missing some key parts), but also a financial management system. Where are Fusion's country localizations? The HR Admin, Payroll, Benefits modules may look good in demos (but what product doesn't?) but no company has selected them (let alone is running them) which is very suspicious.
To call Fusion half-baked would be very, very charitable. Rarely, if ever, in the history of software making have so many taken so long to produce so little. In less the time it took Oracle to present us with a Fusion embryo, Alexander the Great conquered the world. Now, that's perspective.
At last month's HR Technology Conference in Las Vegas, I ran into a senior Europe-based Fusion executive whom I had known for over a decade. As those who attended the event know, the South Pacific section of the conference grounds has many nooks and crannies. So, cornering my old Fusion pal into one of them, I managed to extract a confession from him.
"How many European Fusion early adopters do you have?" I asked.
"Larry will announce them tomorrow at Open World," came the less-than-assured reply.
"Come on, don't give me that marketing crap. We go back a long time. If anybody should know, it's you. For God's sake, you're based out of Europe. So, spit it out." For those who know me, I am nothing if not tenacious. All I got, though, was an embarrassed smile.Of course, the next day at Oracle's annual jamboree Larry in an uncharacteristically lackluster performance was long on vague customer numbers, but short on actual names, and none of them from Europe.
The Paris event, a few weeks later, didn't bring any new names either. Software vendors are rarely shy about trumpeting their customer wins, especially when attached to new products to which they lend the credibility needed to succeed on the market. Sometime they even overdo it - in Europe, think of SuccessFactors and Siemens, or Workday and Aviva, to use the two competitors Larry Ellison had singled out. If Oracle, which nobody by any stretch of the imagination would call a shy, timid or bashful company, cannot produce any European customer, then you and I can only come to a single conclusion: there isn't any.
I can't say this came as a surprise to me. The dozens of Oracle and PeopleSoft customers I have asked in Europe are all unanimous: we will not touch Fusion with a ten-foot pole. Can you really blame them? Functionality that is so limited that it verges on the absurd, the less-than-glorious development and customer-support track record, the realization that Fusion apps, and HCM within them, are just a tiny part of Oracle's portfolio and, even more seriously, the doubts about the strategy behind it.
As I said earlier, the strategy to rationalize all of Oracle's acquisitions into one single product made business sense. But does this strategy devised in the first half of the past decade make sense now when much nimbler vendors whose products have deeper functionality are churning out new releases on a quarterly basis and five years on we are still waiting for Fusion 1.0? Does buying Sun to provide hardware and software together (as Oracle's great slogan goes) make sense when companies are increasingly going to be renting rather than buying their software needs and will therefore no longer require any servers within their corporate walls?
Fusion, and Oracle, look increasingly like today's solution to yesterday's problems. The market has moved on but the big ocean-liner is proving hard to turn around. Actually, considering that Fusion is barely here, it would be more accurate to say that Oracle and Fusion represent tomorrow's solution to yesterday's problems.
A major French bank, BNP Paribas (160,000 employees worldwide), after pulling the plug on PeopleSoft said, "Fusion? Thanks, but no, thanks." Then, adding insult to injury, BNP went to their pre-PeopleSoft vendor, HR Access. It is worrying for Oracle to have its next-generation product rejected in favor of one based on older technology. (With SAP also being used.)
And France is not the only European country where Oracle customers are dumping Oracle, rejecting Fusion and moving to Workday. In a recent interview in ComputerWeekly, the head of HR of UK-based insurance company Aviva, explained why he eliminated Oracle HR and selected Workday: "[with Oracle] when the CEO asked me how many staff we had in Europe, I could not tell him. It took weeks to find out. Now [with Workday] I can do that in 30 minutes." He then goes on to explain why he did not choose Fusion: "The technology was not there, Fusion was not ready, and its software-as-a-service model was not a true SaaS model." He also echoed a common complaint of Oracle customers that "communicating with Oracle was very difficult."
In several forums, I predicted that Fusion would not make any significant traction before 2015. So far, I have seen nothing to amend my analysis. And as for Mr. Ellison's claim of burying Workday or SuccessFactors, even after taking into account the typical hyperbole-prone statements so much favored by our industry, it is simply preposterous and betrays the fear that the reverse may well happen.