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Oracle’s JD Edwards Enterprise Applications—

the Low TCO, High ROI Option for Top Tier ERP

An Oracle Accelerate Briefing

April, 2011

EXECUTIVE SUMMARY

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JD Edwards applications were born in 1977 as the products of an independent

company founded by three individuals who wanted to provide a more

sensible and affordable alternative to existing accounting and distribution

software solutions. Over the years, the company developed a loyal following

of customers in organizations of all sizes and spanning many industries. Now,

as an integral component of Oracle’s overall enterprise applications strategy,

JD Edwards ERP suites—EnterpriseOne and World—remain viable and

compelling options for midsize companies seeking a low TCO entry point into

the entire family of Oracle application, middleware, and database products.

Edwards is an excellent choice

for companies in specific industry

focus areas:

Manufacturing & Distribution

Consumer Goods

Asset Intensive Industries

Professional Services

In both scenarios, these

companies value low complexity

and overall TCO in their

enterprise applications

strategies.

JD Edwards has established and

maintained a reputation for low

TCO via three attributes:

Flexibility and Ease of

Ownership

Targeted Industry Focus

An Architecture Supporting

Choice and Integration

Read on for more insight and

perspective on these subjects.

Oracle offers multiple complete

and robust enterprise application

suites (ERP). Whereas each of

these ERP suites has unique

strengths and capabilities, there

exists a common development

strategy across all products. This

strategy is united in the goals of

helping customers benefit by

leveraging Oracle’s extensive

technology platform—hardware,

database, and middleware—and

its impressive array of

complementary applications.

Early in the selection process,

Midsize Companies considering

Oracle enterprise applications

must decide which ERP suite best

suits their requirements. JD

Edwards has long been known as

an appealing choice for midsize

and larger companies that are

drawn to a low Total Cost of

Ownership (TCO).

This briefing describes the

attributes and qualities of JD

Edwards ERP that make low TCO

a reality for thousands of

customers of all sizes spanning

many industries and geographies.

Since becoming part of Oracle,

the JD Edwards development and

strategy team have concentrated

their efforts on maintaining this

hallmark of low TCO. They have

done so by focusing on the needs

of two types of companies.

First, JD Edwards continues to be

an excellent fit for growing

midsize companies that wish to

deploy a true Top Tier ERP suite

for the first time. Their general

business needs include the desire

to consolidate disparate systems

under a single platform and to

automate processes across the

entire enterprise. Second, JD

“Oracle’s JD Edwards EnterpriseOne applications enabled us to consolidate financial management activities in seven European countries onto a single platform. We now have a shared, global infrastructure, which has helped us to reduce maintenance complexity and costs by nearly 20%.” – Manuel Barreiro, Senior IS Project Manager

Shurgard Self Storage Europe | Brussels, Belgium | 506 Employees | www.shurgard.com

TABLE OF CONTENTS

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TOTAL COST OF OWNERSHIP (TCO) DEFINED

ATTRIBUTES OF JD EDWARDS’ LOW TCO

COMMITTED TO FLEXIBILITY AND EASE OF USE

ADDRESSING INDUSTRY NEEDS—BALANCING COMPLEXITY AND FOCUS

ARCHITECTED BY DESIGN FOR CHOICE AND INTEGRATION

SUMMARY

TOTAL COST OF OWNERSHIP (TCO) DEFINED

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Any discussion of Total Cost of

Ownership (TCO) requires that first

the term be defined by its

components. In a practical sense,

companies measure the TCO of a

technology choice in order to

determine its affordability as well as

to judge its cost and return relative

to other choices.

Does every company measure every

technology initiative at the same

level of detail? The answer is, “most

likely not”. In reality, the way TCO is

measured is probably unique to each

company.

In today’s business climate, product

and service innovation and process

reengineering strategies rely heavily

on IT enablement. Therefore, any

true comparison or evaluation of IT

choices mandates also an

assessment of the value—Return on

Investment (ROI)—of that choice.

COMPONENTS OF TECHNOLOGY TCO

Ask ten IT professionals to identify

the components of technology TCO

and you are likely to get ten different

lists. However, all will agree that

TCO components include both

tangible, “hard” costs and intangible

“soft” costs.

When analyzing the TCO of a

proposed IT solution it is wise to

consider both the hard and soft

costs associated with

deployment and ongoing

activities.

Initial Expenses—

Network hardware and

software

Server hardware and software

Hardware Installation and

setup

Software implementation and

training

Development and installation

of application integrations

Software customizations

Legacy system migration

expenses

Ongoing Operational Expenses

IT staff

Risk Management (including

backup and recovery

activities)

Cost of downtime, system

outages, and system

inefficiencies

Security

Software and hardware

maintenance and support

agreements

Backup and recovery

processes

Integration maintenance

Software patching,

maintenance, and monitoring

Software upgrade installation

Software customization

maintenance

Ongoing training (both IT Staff

and end users)

Ongoing 3rd party consulting

services

COMPONENTS OF JD EDWARDS’ LOW TCO

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Figure 2: Attributes of JD Edwards’ Low TCO

Over the last twenty years, many

good enterprise applications

solutions have disappeared or

faded into the background,

victims of the “dot.com bubble

burst”. Of those vulnerable

companies that survived, most

were purchased by software

consolidators interested more in

maintenance and support

revenue streams than in

continued product development

and innovation

In contrast, JD Edwards holds a

unique place in Oracle’s

applications strategy. Since

being acquired by Oracle,

customers have benefited from

multiple product releases,

linkage to Oracle’s middleware

and business intelligence

infrastructure, and factory built

integrations to industry leading

capabilities in other Oracle

products. As the low TCO option

for true Top Tier ERP, JD Edwards

remains vital to existing

customers and a viable choice for

companies making new ERP

selections.

Lyle Ekdahl, Group Vice President

and General Manager for Oracle

JD Edwards, has a keen

understanding of why JD

Edwards enterprise applications

suites can deliver broad and

deep capabilities at a low TCO.

“We’re not trying to be

everything to everybody,” says

Ekdahl. “If you think about how

ERP software evolved in the run-

up to Y2K, most of the big

vendors started trying to put

everything into one suite of

software. When you do that, you

create complexity that can

translate into increased cost.

Since being acquired by Oracle,

we’ve focused really around a

core set of ERP processes that

are common in a handful of

industries. By doing that, we can

keep the costs down to deploy,

maintain, patch, and manage our

software.”

From Ekdahl’s perspective,

customers fundamentally value

three attributes of TCO that have

been in the software since the

beginning. At a high level, these

attributes provide customers

with a flexible and easy

ownership experience while

fulfilling their industry-specific

and general business needs.

COMMITTED TO FLEXIBILITY AND EASE OF USE

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BUILDING A PLATFORM FOR SUCCESS

Low long term TCO starts with basic IT

infrastructure considerations. At the

forefront of every decision is the reality

that a typical midsize company

operates with a lean IT staff—often

only 2-10 Full Time Equivalents (FTEs).

Although they will likely rely heavily on

external resources while deploying

applications and setting up the IT

infrastructure, they will ultimately

need to be self supportive.

JD Edwards customers have the option

to take advantage of bundling and

pricing incentives by selecting a

complete top to bottom stack of Oracle

hardware, database, middleware, and

complementary applications.

Customers focused on low TCO/high

value alternatives can select the JD

Edwards EnterpriseOne Oracle

Technology Foundation, a complete

package of tools, middleware, and

database. Not only are all components

designed and tested with JD Edwards,

but they are also priced much lower as

a package than if purchased separately.

However, it is perhaps more impressive

that JD Edwards customers are free

and equipped to make non-Oracle

choices in all these areas.

that present compelling price

and TCO scenarios for customers.

Yet non-Oracle hardware and

databases will remain viable

options. JD Edwards customers

with IT resources trained and

accustomed to other vendor

products can choose to retain

those strategies as another way

of keeping or achieving optimal

TCO.

IMPLEMENTING FOR NOW WITH

THE FUTURE IN MIND

Long term costs associated with

the ERP ownership experience

are impacted heavily by the way

solutions are initially deployed.

During installation, anything that

slows down or complicates the

implementation will increase

initial costs and most likely have

an impact on long term

expenses. A successful

deployment of the right solution

choice is key to increasing the

likelihood of low and

maintainable long term TCO.

There are situations in which the

low TCO option may not be a

complete Oracle technology

stack.

All major database alternatives

have high levels of

representation among JD

Edwards customers.

Since JD Edwards applications

run on the popular business

hardware options, customers can

leverage their current hardware

and/or take advantage of the

lowest cost providers.

With Oracle’s acquisition of Sun,

midsize companies can expect to

see increasingly attractive pricing

to encourage that alternative.

Oracle is already seeing

increased selection of Sun as the

hardware provider amongst JD

Edwards customers.

Oracle is committed to

engineering solutions with open

industry standards while also

matching complementary Oracle

products into bundled offerings

Committed to Flexibility…(continued)

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With the most favorable IT

infrastructure in place, the focus

turns to solution implementation.

Five years ago, Oracle launched

Oracle Accelerate—Oracle’s

approach to helping midsize

companies deploy applications

rapidly and at a low cost. This

ongoing program standardizes rapid

implementation best practices

across the full range of Oracle

applications. From an Oracle

development and strategy

perspective, each product group

works with a common set of guiding

principles toward the same goals

while taking into account unique

architectural considerations.

A key component of Oracle

Accelerate are Oracle Business

Accelerators—rapid

implementation tools used by

partners and Oracle Consulting.

Oracle Business Accelerators are

optimized configuration tools that

incorporate Oracle’s vast industry

and region-specific implementation

experience while providing the

flexibility to personalize the

configuration according to a

customer’s business requirements.

Some rapid configuration tools in

the marketplace simply provide

templates with pre-configured

system setups that lock-in

customers to specific configurations

and prevent subsequent changes as

businesses evolve. In contrast,

Oracle Business Accelerators

“For JD Edwards,” says Ekdahl,

“we’ve invested in a strategy

that has allowed us to continually

evolve and optimize the rapid

implementation tools we make

available to partners and Oracle

Consulting. For example, in

conjunction with the Oracle

Accelerate team, we recently

released a new set of next

generation Oracle Business

Accelerators that provide

significantly increased accounting

setup personalization via the

Q&A component. This enables

implementers to leverage the

intuitive Q&A interface in

personalizing the Chart of

Accounts and corresponding

accounting rules. In more closely

address customer accounting

requirements, implementation

costs can be reduced further and

the development of additional

Oracle Accelerate Solutions is

facilitated. We have plans to

deliver more of these next-gen

Oracle Business Accelerators for

additional industries and

regions.”

provide industry and region

specific business flows and

configuration content couple

with an online Q&A tool that

captures a customer’s specific

requirements and personalizes

the resulting configuration. The

configuration deployed to the JD

Edwards EnterpriseOne instance

is not locked in stone and can be

subsequently changed in any way

necessary as the customer’s

business changes.

ORACLE ACCELERATE SOLUTIONS

Often, partners and Oracle

Consulting entities take the next

steps, creating Oracle Accelerate

Solutions. These solutions are

reviewed by Oracle and

represent the packaging of

Business Accelerators with

implementation services and

other products and services such

as engineered hardware

configurations, financing,

applications hosting, training,

and partner-developed industry

applications or extensions.

Committed to Flexibility…(continued)

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“It’s important to remember,”

continues Ekdahl, “that the

Business Accelerators we are

building along with their collateral

are designed to reduce the time to

value for JD Edwards EnterpriseOne

implementations while not limiting

the flexibility or impacting the low

TCO that is inherent to the product.”

STREAMLINING INSTALLATION

In addition to reducing

implementation time and costs, the

Oracle Accelerate strategy includes

a focused effort to streamline the

installation of JD Edwards

EnterpriseOne. Streamlined

installers in the ERP industry have

shown to significantly reduce

implementation costs. Oracle’s

investments in this area for JD

Edwards EnterpriseOne

demonstrate its continued

commitment to the needs of midsize

companies.

To date, Oracle has created rapid

installers for standard and

virtualized instances of JD Edwards

EnterpriseOne. For standard

instances, Oracle has rapid installers

available for the System I (Express

Installation for IBM I) and Oracle

Linux platforms. In addition, there

are plans for rapid installers to be

built for additional platforms

supported by JD Edwards

EnterpriseOne including Windows.

On the virtualization front, Oracle is

on its third release of Oracle VM

(Virtual

Machine) templates for JD

Edwards EnterpriseOne. Oracle

VM templates for JD Edwards

EnterpriseOne are preconfigured,

pretested templates of JD

Edwards EnterpriseOne ERP,

Oracle Database, and HTML

servers. Implementation time is

reduced from the days or even

weeks needed for a traditional

approach to a matter of minutes.

Once the virtual machines are

running, the implementation can

be completed—adding users,

setting up security, and

configuring applications.

Additionally, Oracle JD Edwards

has invested in creating a

powerful collection of

configuration tools that assist

with a variety of system

administration tasks. This

includes additional

implementation tasks and the

maintenance of multiple

instances of JD Edwards

EnterpriseOne. This collection of

tools is available to Oracle

partners, Oracle consulting and

customers.

TOP TIER ERP THAT IS EASY TO

MAINTAIN

Any rapid implementation

methodology cannot be

successful unless it delivers a

product that meets current

needs and provides flexibility and

scalability for the future. Midsize

customers should expect their

chosen solution to cover the vast

majority of their business needs

via configuration.

Avoiding customization requires

deep and broad functionality

within the core ERP systems.

Additionally, configuration

mechanisms must be logical and

intuitive to minimize the need for

IT support.

JD Edwards is enterprise-class

software—all customers run the

same applications regardless of

their size. Companies within JD

Edwards industry focus areas—

as well as those requiring the full

range of general business

process capabilities—can be

confident that the applications

feature the required functionality

lacking in lower tier—“Tier 2”—

solutions. Additionally, JD

Edwards ERP features embedded

tools for system-wide

configuration and development

that are employed both when

the software is first implemented

and for adjustments in support of

ongoing process changes.

Through the use of Processing

Options, User Defined Codes,

Applications Versions, Automatic

Programming Interfaces (APIs),

and System Constants end users

can usually make changes

without code modifications. This

minimizes the IT resources

needed to support interface

personalization and application

customization. These

components are maintained

through standard lifecycle

management tasks so that

configurations are sustained

throughout upgrade processes.

ADDRESSING INDUSTRY NEEDS—BALANCING COMPLEXITY AND

FOCUS

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It’s no secret that, when it comes

to enterprise software, there is a

direct relationship between

complexity and cost. Every

software provider has struggled

with how to offer a

comprehensive footprint with

flexibility and robust extensibility

while keeping TCO reasonable.

Oracle solves this dilemma via an

industry-focused approach. With

three comprehensive, scalable

ERP suites, Oracle’s product

development strategies can be

tailored to the industry strengths

of each. This focus can go even

deeper into industry sub-

segments by leveraging the

strengths of each product line.

JD Edwards’ development

strategy is complementary to

Oracle’s comprehensive industry

focused approach which

establishes Oracle as the

enterprise software provider

with the most extensive industry

and sub segment coverage.

For example, Oracle’s PeopleSoft

Enterprise features Campus

Solutions and Human Capital

Management capabilities that fit

the very unique and fundamental

requirements for higher

education and staffing

companies. Likewise, Oracle E-

Business Suite has deep

capabilities for select Industry

Segments such as High

Technology Semiconductor

Manufacturing and Retail Quick

Serve Restaurants.

For JD Edwards, the industry

focus is primarily in four areas—

• Consumer Goods

• Manufacturing & Distribution

• Asset Intensive Industries

• Professional Services

Additionally, thousands of

companies have deployed JD

Edwards EnterpriseOne and

World as a general business ERP

solution for their in-depth

capabilities across standard

business processes such as Order

to Cash and Supply Chain

Management.

COMPREHENSIVE CAPABILITIES

IN JUST THE RIGHT AMOUNT

The unique underlying

architecture of JD Edwards

software enables Oracle to

provide just the right amount of

ERP capabilities without

overwhelming complexity.

“When most ERP providers go

down-market to address the

needs of midsize companies they

use the same formula,” says

Ekdahl. “That is, ‘less in the

package equals less complex’.

But they miss some of the right

stuff so customers have to

extend with customizations or

buy other products which raises

TCO. We’ve picked the right

stuff in our development

focus—the core processes that

everyone needs to run. We take

it the next mile in a few select

industries and processes to be

complementary with what’s

available across Oracle’s three

ERP suites.”

Learn more about JD Edwards’

Industry-specific capabilities

for:

Asset Lifecycle Management

Food and Beverage Producers

(Agriculture)

Manufacturing and Engineering

Order Management

Project Management

Real Estate and Home

Construction

Supply Chain Planning

Supply Chain Execution

(Logistics)

Supply Management

(Procurement)

Addressing Industry Needs…(continued)

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Addressing Industry Needs…(continued)

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ARCHITECTED BY DESIGN FOR CHOICE AND INTEGRATION

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Every midsize company seeks the

optimal balance of flexibility,

functionality, and complexity when

choosing to deploy a

comprehensive, integrated

enterprise applications solution and

its associated IT infrastructure. For

midsize companies, too much

flexibility can lead to a confusing

situation—where do we start?

Likewise, a limited footprint—low

complexity—can mean operational

needs can’t be met. Oracle JD

Edwards ERP products—both

EnterpriseOne and World—have

earned unique reputations for their

ability to satisfy the needs of a

broad range of customers within a

single application suite.

EXTENSIBILITY AND INTEGRATION

As mentioned earlier, midsize

companies deploying a

comprehensive, integrated ERP

suite for the first time are typically

motivated by the need to automate

manual processes or consolidate

multiple operating entities into a

common IT platform. They

justifiably expect to be able to

accomplish those goals within their

core ERP system.

With its broad solution footprint

and deep functionality for select

industries and general business, JD

Edwards ERP typically provides

capabilities that cover the vast

majority of business process

requirements. However, growing

companies cannot foresee all

possible scenarios associated

with expanding products and

services or venturing into new

global markets. Thus, when

selecting an ERP solution,

decision makers must consider

how to maintain low TCO in

dealing with potential situations

that require integrating to third-

party applications or developing

extensions to core ERP

processes.

Like all Oracle development and

strategy groups, JD Edwards has

dramatically moved to a Services

Oriented Architecture (SOA)

approach. For example, with

many other ERP suites customers

may need to use multiple tools

for activities such as change

management and security. This

requires an investment of time,

money, and resources in

developing IT staff skills across all

toolsets or contracting with

partners to perform the related

activities. JD Edwards customers

need only to learn one universal

Figure 3: JD Edwards Solution Design Finds the Right Balance between Capabilities and Complexity

Architected by Design for Choice and Integration (continued)

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toolset for open cooperation

with other applications outside

the core ERP suite whether

integrating to 3rd party or other

Oracle products.

When business requirements

exceed capabilities within the

core ERP suite, Oracle customers

first look to Oracle’s portfolio of

solutions since there are factory-

built integrations between JD

Edwards and many of those

products.

However, some companies may

have a very unique business

process that is a competitive

differentiator which cannot be

met by standard functionality but

ideally needs to stay within core

ERP processes or applications.

When customers extend

functionality within JD Edwards

they are advised to follow a

framework of processes and

tools—outlined in the JD

Edwards Extensibility Guide—

that are automatically integrated

to the Lifecycle Management

tools. If these standards are

adhered to, minimal effort is

required to migrate and merge

application extensions.

SUPPORTING SINGLE OR

MULTIPLE INSTANCE STRATEGIES

One of the desirable attributes of

Top Tier solutions such as JD

Edwards EnterpriseOne is the

ability to deploy a single ERP

instance that meets a company’s

needs in all the global markets

they serve. A single global

instance is a viable option for

most JD Edwards customers.

Oracle supports 22 languages

and 33 localizations, with

additional support providing in

some emerging markets by

Oracle Certified partners.

Most Tier 2 and Niche vendors

Figure 4: JD Edwards Architecture Provides Customers with a Vendor-Agnostic Infrastructure and Flexible Extensibility Framework

Architected by Design for Choice and Integration (continued)

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Figure 5: Companies of all sizes deploy the same JD Edwards application suites

can’t offer that option because

they are unable to support as

many currencies, languages, and

localizations. Nor can they

provide around the clock

technical support in as many

countries as can Top Tier

providers. Chances are, with a

Tier 2 or Niche vendor,

companies must make difficult

decisions as to how many

instances they must deploy to

cover all permutations of

currencies, countries, brands,

and lines of business.

However, there are

circumstances that warrant

multiple instances and the ability

to deploy them quickly and at a

low TCO. Examples include

Merger and Acquisition activity

and expansion into emerging

markets where margins are

squeezed tight and the

communications infrastructure

may not be up to the standards

of established markets.

“We scale up, we scale down,”

says Ekdahl. “We have customers

running single global instance on

JD Edwards for worldwide

enterprises. We also have

customers who deploy multiple

instances when it’s makes sense.

We have a customer in the Oil

and Gas industry that has been

known to install a basic image of

their corporate JD Edwards

instance on a server with Linux

and fly it into a remote location

in the same plane as equipment.

With low internet bandwidth and

sporadic connectivity, they push

information back asynchronously

to corporate when it’s possible

and convenient. While not

impossible with other Tier 1

solutions, cost and complexity

makes such an undertaking

impractical for companies with

limited resources.”

SUMMARY

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JD Edwards enterprise application suites—EnterpriseOne and World—remain viable options for midsize companies

looking for Top Tier ERP at a low TCO. These suites are the lowest price entry point into Oracle’s family of

products.

JD Edwards’ proven low TCO is attributable to three attributes:

Flexibility and Ease of Ownership—a commitment to low cost implementations and maintenance

Industry Focus—balancing complexity by limiting complexity and focusing on core industry segments

Architecture—designed to support choice and integration.

Lyle Ekdahl, General Manager of JD Edwards, believes that Oracle’s development strategy for JD Edwards

applications helps reduce the costs for customers to deploy, maintain, patch, and manage Oracle software. That’s

especially important in today’s business climate because it frees up those customer’s IT budgets to tackle other

problems that are asynchronous to ERP.

“Most of our customers are interested in being more efficient in their CRM, Business Intelligence, and Supply

Chain Management processes and are concerned about the cost of applying technology solutions to their

problems,” says Ekdahl. “Oracle has products to address just about every need our customers have. Our overall

strategy is to deliver incremental value in being an Oracle customer—beyond ERP—at a cost point and positive ROI

that makes sense.”

Learn more about Oracle JD Edwards Enterprise Applications

JD Edwards EnterpriseOne: http://www.oracle.com/us/products/applications/jd-edwards-enterpriseone/index.html

JD Edwards World: http://www.oracle.com/us/products/applications/jd-edwards-world/index.html

Learn more about and stay connected with Oracle Accelerate for Midsize Companies

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