IT Convergence’s recent webcast “Overcoming the China Oracle ERP Localization Challenge” was an impressive success, and on the heels of such a successful webcast we decided to catch up with the IT Convergence China Services Director.
Q: April 2013 webcast was termed “a success.” But of course “success” can be a relative term. When you say a webcast is successful, what do you really mean?
A. Well you’re right, “success” depends on the context you’re working in. Fortunately we have the benefit of having done several – close to a half dozen, I think – webcasts on Oracle rollouts in China since December 2006. So our China consulting services team has done this before, and we had a good feel for what to expect.
With that said, the results were unexpected. We had over 60 people register and that was twice as many as our previous webcast. So while that was a pleasant surprise, what was even more surprising were the questions. Normally we only need to answer a handful of questions during the Q and A section – this time we had close to a dozen.
After doing all of that preparation, it was really good to see that the audience found our presentation so useful and were so engaged.
Q. Very interesting. So what do you think is going on here? Why the increased interest in Oracle ERP solutions for China?
A. China, being the fastest growing economy in the world, provides great opportunities for foreign investments. More and more multinational companies are setting up business operations in China. Companies operating in China have some major challenges to meet, including how to leverage their global business processes and system templates. As this China localization process happens, the need to integrate these processes into a global ERP footprint is a logical next step for these multinational companies.
Q. As you know, we did audience polling during the webcast, and we had a number of things that sort of jumped out at me. The first question concerned the general Oracle E-Business Suite footprint, where the breakdown between Oracle R12 and Oracle 11i was 50% R12 to 45% 11i with 5% of users running legacy or other non-Oracle ERP. This is the first poll I have seen that shows more Oracle ERP users on R12 than 11i. Did that surprise you?
A. It did a little, but there are a couple of things to take into consideration. First, the webcast focused on Oracle R12 solutions for China, and it’s logical that most companies would do an R12 Upgrade at their HQ before doing it globally. The other thing is of course the sample size, which was a little small to be drawing broad conclusions.
Q. Fair point – while our webcast polls do give us insight into the Oracle E-Business Suite end user community they’re not scientific. But I’d like to go back to something you just said, because it reminds me of our next polling question.
Only 25% of the respondents said they had Oracle running in China and these indicated they were still on 11i and needed to go to R12. That number is not too shocking, but the next two are. 44% say they have business units in China but have not incorporated them at all on to their ERP platforms. And another 25% indicate they need to do a greenfield implementation. Based on your experience, could you name a few challenges or risks that explain why ERP adoption has been slow in China?
A. Well, there are a lot of reasons, but most of them find their roots in the common challenges and risks that we’re familiar with: cultural differences (business style and working style) and gaps between local business process and corporate ERP solutions can seem daunting. Local reporting, security, language and even time zone can contribute to the resistance to change from legacy systems to ERP solutions like Oracle.
In recent years, we have noticed that local users are more ready not only to accept but to embrace global standards and system templates. Local users are getting to the point where they want to have a global ERP system to support their business operations instead of local standalone applications.
Q. The biggest concern that our webcast attendees had about China projects is in configuring Oracle to meet local regulations, such as Golden Tax or China GAAP requirements that differ from US ones. Yet only 21% admit to worrying about language and cultural considerations, 11% are worried about finding skilled project mangers and skilled technical and functional ERP experts in China, and another 11% worried about supporting Oracle after Go Live.
How can IT Convergence help these organizations to minimize their concerns or worries?
A. ITC has been ahead of the curve, opening an office in Shanghai close to a decade ago. That has given us the opportunity to build a bilingual team of proven Oracle ERP experts, who act as liaison between a company’s local team in Shanghai, Hong Kong, or Beijing and corporate headquarters located somewhere else in the world. Moreover, the breath of our expertise is as wide as it is deep – we not only offer skilled consultants in Oracle Financials, Supply Chain Manufacturing, and HRMS but we can also support projects via our project management, DBA and remote technical support services.
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