ORACLE STRATEGIC PLAN

Oracle Strategic Plan

Edwin Nash

Hosianna Batubara

Alex Edeigba

MGT 527 01 E – FALL 2015

Texas A&M University Commerce

ORACLE STRATEGIC PLAN

Table of Contents

Introduction .....................................................................................................................................3

Industry Analysis ............................................................................................................................7

Macro-Environment Analysis .......................................................................................................12

Organization’s Measurement and Control System .......................................................................16

Organization Analysis .................................................................................................................. 22

Organization-Level and Business Unit Strategies ....................................................................... 31

Functional Strategies .....................................................................................................................32

Organization’s Improvement Initiatives .......................................................................................42

Conclusion and Future of Organization ........................................................................................46

References .....................................................................................................................................50

Appendices ....................................................................................................................................51

ORACLE STRATEGIC PLAN

Introduction

The oracle corporation is an American global computer technology firm. It’s located in

the silicon valley of California. Its main area of specialization is in developing and marketing its

computer hardware systems and enterprise software products. It even has its own database

management systems. After Microsoft, Oracle became the second largest software maker by

revenue. The corporation also develops and builds tools for database development systems of

middle tier software, enterprise resource planning, customer relationship and supply chain

management software.

Larry Ellison co founded the firm in 1977 with bob miner and Ed Oates under the name

of Software development laboratories. Larry took inspiration from the 1970 paper written by

Edgar Codd on relational database management systems. He heard about the IBM system

database from an article in the IBM research journal provided by Ed. Larry wanted to make

Oracles products compatible with system R, which he derived from Codd’s theories, but it failed

as IBM kept their error codes for the DBMS as a secret. Later on SDL changed its name to

relational software in 1979 and then in 1982 to Oracle Systems Corporation so as to align itself

with its flagship product called oracle database. It then later changed its name to Oracle

Corporation and now officially called Oracle. A part of the firm’s early success arose from using

C programming language to implement its products, as it was easy to port into different

operating systems. Oracle is a publicly held company.

At present today Oracle is one of the largest business software firms in the world with

more than 33000 customers. And it supports these customers in more than 145 countries and

leverage complete stacks of open and integrated products that work with existing products and

realize high return on investment.

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Organization’s Top Executives Analysis

Larry Ellison: Holds the title of executive chairman of the board and chief technology officer.

He studied at the University of Illinois at Urbana–Champaign and the University of Chicago

without graduating before moving to California in 1966. He worked at Ampex in the early

1970s.

Safra Catz: She is chief executive officer of Oracle Corporation and a member of the

company’s board of directors. She previously served as president of Oracle and has also

served as the company’s chief financial officer. Catz first served as Oracle’s chief financial

officer from 2005 to 2008, as executive vice president from 1999 to 2004, and as senior vice

president. She has served on the board of directors for HSBC Holdings. Catz earned a

bachelor's degree from the Wharton School of the University of Pennsylvania in 1983 and a

J.D. from the University of Pennsylvania Law School in 1986.

Mark Hurd: He is the chief executive officer of Oracle Corporation and a member of the

company’s board of directors. He joined Oracle in 2010, bringing more than 30 years of

technology industry leadership, computer hardware expertise, and executive management

experience to his role with the company. He earned a BBA from Baylor University.

Jeffrey Henley: he is the vice chairman of Oracle Corporation. He served as Oracle’s chief

financial officer and an executive vice president from 1991 to 2004, and has been a member

of Oracle’s board of directors since 1995. Henley was chairman of Oracle from 2004 until

2014. He also serves on Oracle’s Executive Management Committee. He holds a bachelor's

degree in Economics from the University of California, Santa Barbara, and an MBA in

Finance from the University of California.

Hector Garcia: board of director and graduated with a bachelor's degree in Electrical

Engineering from the Monterrey Institute of Technology and received both a master's

degree in Electrical Engineering and PHD from Stanford University.

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Organization Business Model

When we look today the phenomenon of mature software company goes on. This is

practically an orphan in the stock market. Stocks like these don’t have a strong shareholder base

because the growth is very slow and many investors dismiss technology as impossible to analyze

and predict. Also accordingly the classic way of analyzing software stocks doesn’t apply to

mature firms as the recurring revenue of support contracts often makes up a large portion of the

profits. While many mature software firms are seen as old by investors and they trade at below

market valuations, which could have more predictable business models than young and fast

growing software firms.

When one looks at Oracles business model, it seems complicated with many divisions.

And along with the complications one can see a razor and blades business model where the razor

represents one time sales of new hardware and software licenses, where as blades is the one that

brings along a support contract and adds high margin. Many analysts focus on new hardware and

software licenses sale, but majority of the firm’s earnings and revenue come from support

contracts which have a high renewal rate and inflation correlated price increase.

Impact of globalization: Software firms play an important role in globalization as it is

being used by people all over the worlds. Oracle has created a big impact in the global market.

They have the concept of globalization support, which allows customers to use and run its

products anywhere in the world by providing content in the users native language and location

preference. Most importantly it enables its users to develop their own multilingual applications

and software products using the technology of Oracle like Globalization development kit.

Identification of the industry and its competitors:

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Oracle is the leader in global software industry and it has many big competitors. Indeed

times are changing for the firm from the time they had big rivals like big tech companies. But in

recent time’s new competitors and quickly evolving technology means that Oracle has had to

scramble from becoming obsolete. Oracle is trying to stay important in the global market which

has quickly moved from downloading software onto big computers to the cloud. Business

customers are handing over their jobs to different firms when it could be operated in house by

connecting to the data by internet.

The firm has been trying to build a reputation for itself in the cloud computing world by

hiring legions of engineers specialized in cloud. This is due to the decline in sale of new

customer software licenses. Oracle has many competitors like IBM, SAP etc. since the focus was

on cloud they don’t fear much competition from them. Oracle now has competition from sales

force and workday which also deals with cloud services for HR and sales departments. But

Oracle has many new services like e- commerce software, HR application and support for open

source data technologies which its competitors don’t have or offer. Also the firm offers a storage

service for archiving data at an affordable price. The firm recorded revenue of $22,430 million

during the financial year of 2012, an increase of 24.5% over 2010. The increase in the firm’s

revenue was due to the acquisitions of Hyperion, Agile Software and BEA Systems. The

operating profit of the company was $7,844 million in 2008, an increase of 31.3% over 2007. Its

net profit was $5,521 million in 2008, an increase of 29.2% over 2007.

Table 1

Software Companies Ranked By Sales

Company

Symbol

Price

Change

Market Cap

P/E

Microsoft Corporation

MSFT

54.19

432.86B

36.03

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IBM Software

Private

Oracle Corporation

ORCL

39.34

0.01

167.77B

18.44

SAP SE

Private

CA, Inc.

28.28

12.41B

16.45

Table 2

Direct Competitor Comparison

Column1

ORCL

PVT1

MSFT

IBM

Industr

Market Cap:

167.77B

N/A

432.86B

134.36B

499.88M

Employees:

132,000

744,061

118,000

379,592

708

Qtrly Rev Growth (yoy):

-0.02

N/A

-0.12

-0.14

0.26

Revenue (ttm):

38.08B

21.34B

90.76B

83.80B

145.71M

Gross Margin (ttm):

0.6

N/A

0.65

0.5

0.65

EBITDA (ttm):

15.79B

N/A

32.44B

21.41B

-989.00K

Operating Margin (ttm):

0.37

N/A

0.3

0.21

-0.07

Net Income (ttm):

9.50B

3.99B

12.27B

14.42B

N/A

EPS (ttm):

2.13

N/A

1.5

14.37

-0.17

P/E (ttm):

18.44

N/A

36.03

9.64

38.67

PEG (5 yr expected):

2.02

N/A

2.13

1.28

0.94

P/S (ttm):

4.37

N/A

4.75

1.58

3.83

Industry Analysis

The software industry is large, highly competitive, and globalized. In 2014 the US share

of the packaged software market was around $130 billion or 45% of the global market. More

than half of the software sale comes from the global market. Computer software production in

the US involves about 50,000 companies and combined annual revenue of about $180 billion.

The worldwide software market was around $85 billion which is almost 25% of the total

packaged software market. Oracle faces competition from different firm in an industry which is

very large, but overall Oracle is the clear winner and leader in this industry with an estimated

45% market share. Oracle did something that their competitors never thought of which is they

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acquired Sun Microsystems to become the supplier of everything in the software industry. It

helped them to suppress its competitors. Moreover, the company’s Porters 5 forces are as

follows:

Threat of New Entrants

It relates to the difficulty level of entering the industry. Substantially if there are more

barriers to enter in the market the threat of new entrants would be reduced. The entry barriers are

brand loyalty, cost advantage, switching cost, government regulation level and economies of

scale. Threat of new entrants in the software market is high especially in the US. This is due to

the large sums of financial resources needed for entering the market as it has been raised by the

competitors. This is a threat and risk for Oracle as many new businesses with newly developed

and innovative software products are being launched and they can claim the market share very

soon.

Bargaining Power of Buyers

Oracle targets big firms, so pricing is not the main factor for customers when making a

purchase so this makes the bargaining power of buyers low. The buyers do not have much power

in negotiating. The products and services being offered by Oracle are for a niche market and they

do not have many established competitors. So the gap in the product pricing by the competitors

is low and even acquisitions reduce competition and consolidates market share of software firms

which in turn reduce the buying power.

Threats of Substitute Products and Services

When the economy is doing well the threat of substitute products is low and switching

cost is high. But when the economy is bad it becomes opposite as customers have the urge to cut

costs and operate with existing systems. Customers may not be attracted to high priced products

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if the long term benefits are not in favor of the customer’s objective. The scope of substitution in

very low when it comes to pricing of products, as the competitor’s pretty much price the same in

the market.

Bargaining Power of Suppliers

The suppliers for oracle have high power as the technology that was available for them to

make products were pretty new and the demand for resources for high. But now the supply has

exceeded demand so the bargaining power of suppliers have reduced. Also the power of suppliers

have reduced as the outsourcing costs involved to develop products has considerably enhanced

the abilities of software firms to negotiate in terms of setting up their operations.

Level of Rivalry among Competitors

Oracles database is the number 1 product in its category of products being offered but

industry players like IBM and Microsoft are always developing and innovating to steal that

position.SAP AG currently leads the market in the ERP suite of products and holds an advantage

in the domain due to its early entry. SAP AG will continue to pose a threat to Oracle’s revenues

in the application market. Firms like HP and IBM are well established in the hardware sector

and have strong hold and will always be a hindrance in the growth of Oracle. Oracles

competitors are all well established firms so they have the ability to invest a significant amount

in sales and marketing.

Potential Profitability of the Industry

Microsoft, Oracle and SAP represent over 63% of all revenues. Fast-growing Workday is

still tiny in comparison to Oracle or SAP. In-line growth of 3% at Oracle produces a firm that

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currently is two times the size of Workday. The Growth rates, however, paint a different picture.

Most software companies are growing two times faster than the industry average of 14%.

In this industry, profitability from firms like Microsoft, Oracle and SAP earn almost 75%

of sector EBITDA. This contrasts with other small firms, which generate only 3.5% of sector

profits. Salesforce.com represents a tiny 25 basis points of the benchmark’s profitability. As a

whole, the benchmark group produced over $72 billion in profits, and according to research it is

estimated that the total worldwide software operating profits would be around $75 billion. The

market has cooled down for the software industries. And this has given them an advantage to

develop and expand into new markets. The highflying stocks are bearing the burden of the cold

shoulder towards software market.

Figure 1.

IT Industry market share. This figure

illustrates SAP, Oracle, and Microsoft in IT Industry.

Critical Success Factors

The critical Success Factors of Oracle is that they mainly depend on technical expertise

and marketing. They meet the real needs of customers better than the competitors, Develop core

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competencies that lead to higher levels of customer satisfaction and Process integration is

considered to hold the key to future competitive success.

Technical expertise

. It is the skill or experience the firm has got in the technology field.

Oracle has state of the art technical expertise in hardware and software. The pace of development

with hardware and software is increasing over time. The firm has a wide range of hardware

development services and it is based on their technical skill sets. Even their expertise in software

development is the best from making software projects to high level programming for operating

systems.

They also offer solutions to any software requirements or issues, they set up project

related on site development teams at firms, and they also handle project management and

implement them in technical offices around the world. Oracle also offers support for entire

projects or individual development packages.

Marketing

. Marketing is critical to the success of any software product, because there

are so many firms competing in the software market and because pc and laptops are still new to a

lot of people and business processes. In fact, in many companies that produce software, the

marketing department calls the shots. Oracles marketing techniques are very fresh and

innovative.

The world is going digital since it’s the age of social media and many online apps that

available can help gain market share. Oracle breaks down the organizational silos and organizes

around the consumers. It then uses data content and marketing technologies to enable a consumer

focused real time approach. Since the firm is investing in new technologies and using the right

marketing strategies they have been earning high ROI so as to build a digital future in marketing.

When it introduced Oracle marketing cloud it has seen an increasing number of its customers

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delivering a level of real time service. This is due to the content management, data collection and

consumer communication which makes it the platform for the best marketing technology stacks

in the global market. Oracle Marketing Cloud makes it possible for firms to understand the body

language of their consumers digitally and communicate through right channel with the right

message in real time. It is oracles technology that makes it reality for its customers.

Macro-Environment Analysis

Risk Factors

Oracle operates in a fast changing economic and technological environment; hence it is

faced by several risks that are influenced by many factors which are off the company’s control.

Economic, political and market situations can be related to this; therefore it could affect the

company’s business, results of operations and financial condition, including its revenue growth

and profitability, which in turn could unfavorably affect its stock price.

Political/Legal Forces

Politics can increase the company’s risk factors, because the government can make

unexpected changes to business rules, which could negatively affect Oracle’s business activities.

Political strife in areas like Middle East, which have led to terrorist attacks across the globe and

the likelihood for future aggressions in various parts of the world, and the potential for other

hostilities in various parts of the world, could affect the company’s profitability. In February

2015, Oracle America Inc filed a law suit against the state of Oregon, for a failed health plan

exchange website that the company was designing. The company claimed that 5 former staff and

campaign advisers to the state’s former governor, worked behind the scene to kill the project.

This could affect the company’s PR, sales and future businesses.

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Economic Forces

The ongoing economic crisis in Europe, the continued slow pace of economic recovery in

the U.S., and a slowing economic condition in parts of Asia and South America could negatively

affect Oracle’s business, operating results or financial condition. This in turn, could unfavorably

affect the company’s stock price. The federal governments of the United States that are one of

the big customers of the company have significantly reduced its spending in order to meet up

with the “Sequestration Policy”. A general weakening and declining of corporate confidence in,

the global economy or the restriction in corporate or government spending have caused the

company’s current or potential customers to reduce their information technology (IT) budgets or

otherwise source for cheaper options for its software, hardware systems or services purchases.

These have led to delay, decrease or cancelation of purchases, or have allowed customers not to

pay the company, or in some cases delay paying for previously purchased products and services.

According to a report by Wall Street Journal, Oracle reported a larger than expected drop in

sales. The company blamed the drop in sales on the strong U.S dollar which recently appreciated

against major world currencies. This effectively discounted the sales the company made abroad.

Acquisitions also present many risk to the success of the company, and it may not realize its

financial and strategic goals that it had earlier contemplated. In recent years, Oracle has invested

billions of dollars to acquire a number of companies, products, services and technologies, and

this has become an important element of Oracle’s overall corporate strategy. This program is

expected to continue, but the risk involved in this is that the company, product, service or

technology may not succeed due to numerous reasons detailed below

Social Forces

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There is no doubt that the society will continue to change, hence causing change in taste,

buying habits, lifestyle, education level, emphasis on safety, religion and beliefs, health

consciousness, attitude toward customer service and product quality, attitude towards product

and services (local or imported) etc. The software production industry have been affected by

some of the changes mentioned above, therefore it is necessary to pay attention to this changes in

order to remain competitive in an industry known to be fast paced. The use of social media

strategy has been of great importance to Oracle, because the company has using it to engage

existing and prospective customers, reinforce brand messaging, influence customer opinions,

provide targeted offers, and service customer more efficiently. The success of this strategy could

lead to increased awareness, sales improvement, better customer service, and increased

efficiency. However, failure to implement this strategy could lead to the company losing its

market share and ability to compete.

Technological Forces

Oracle’s success also depends on its ability to develop new products and services, while

integrating acquired products and services; and enhancing its existing products and services. The

company competes in an industry known for its rapid technological developments and changing

standards in the computer hardware, software development, and communications infrastructure;

coupled with changing and increasingly sophisticated customer needs, and frequent new product

introductions and enhancements characterized by the enterprise software and hardware systems.

Failure to develop new or adequately differentiated products and services, or enhancing

and improving its products and support services in a timely manner; or to position and/or price

its products and services to meet demand, may cause customers not to buy new software

licenses, cloud software subscriptions or hardware systems products or purchase or renew

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software license updates and product support or hardware systems support contracts. The

renewals of these support contracts are important to the company’s growth. In order to meet up

with the challenges that this might bring the business, Oracle has continued to develop new

products that will allow it compete effectively for business opportunities in emerging areas. The

company has continued to invigorate and release new offerings of software and hardware

products and services, an continue to hope that these new products will be accepted.

Opportunities

There are series of opportunities open to oracle, which could lead to the actualization of

its long-term growth. They include;



Increasing the company’s presence in economies such as China and India, where the

population is great, and is generally considered a prime destination for most

multinational. This allows it the company to expand its business and diversify its

portfolio of products and services.



The ability to generate additional revenue for the company, through an increased level of

investment in the development of virtualization software programs.



It also has the opportunity to achieve long-term growth by providing sophisticated data

storage services, while intensifying the demand for the product through its various

promotional tools.



It can also launch new research and development initiatives, which will be aimed at

developing innovative business applications for various types of devices, thereby

increasing the level of revenue stream of the company.



Fragmented Markets – This provides many opportunities for Oracle to expand and

increase its market share. The fragmented markets have many small companies that

cannot compete, on the basis that they lack the cost advantages of larger companies.

Threats

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A set of particular threats have to be addressed by Oracle Corporation effectively so as to

actualize its sustainable progression in the future. The company’s major threat is the rise of new

competitors from China, India or any other developing giants from the East. This is because

Oracle would find it challenging to contend with such a rival on prices putting into consideration

the competitors’ access to significantly cheaper resources, which includes human resources in

China and India. Others include:



A volatile currency and a bad economy could make Oracle’s investments difficult, since

costs and revenues could change rapidly. It could reduce the number of potential

customers.



Highly Competitive International markets could also affect Oracle’s business. This is

because the market usually has numerous competitors that are difficult to combat against.

These companies could have many competencies that could give them an advantage over

Oracle. In order to grow the market in these markets the company has to incur a lot of

cost.



The possibility that competitors could lure customers away from Oracle with superior

products and services, could affect the company’s profit.



Changes to government rules and regulations can negatively affect Oracle.



Consumers taste could change at any time, hence Oracle has to have a better

understanding of these trends, or it will lose its market share.



The availability of substitute products could hurt Oracle’s ability to raise prices, because

customers can easily switch to another product or service

Organization’s Measurement and Control System

Oracle Corporation provides products and services that address all facets of corporate

information technology (IT) environments, from applications, to platforms and infrastructure.

This services are provided via cloud computing or on premise deployment models. It also offers

for sale database and middleware software, application software, cloud infrastructure software,

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hardware (Oracle Engineered Systems, servers, storage, networking and industry specific

products), and related support and services. It has over 400,000 worldwide customers, and offers

to them a choice of deployment models that will best suit their needs.

Oracle is one of the world's largest supplier of enterprise software and a principal

provider of computer hardware products and services. The company's operations are divided into

three segments namely Software, Hardware Systems and Services. The Software segment

contributes 73% of the company’s total sales, while the other two contributes 15% (Hardware

system) and 12% (Services) respectively. The company as at November 24, 2015 had a market

capitalization of $168 billion. The company has recorded sales over $37 billion, with 53% of

sales originating from Americas, 30% from Europe, Middle East and Africa, while the Asia-

Pacific region contributes 17% sales.

Revenues (Year Ended May 31st 2015)

Using 2015 quarterly reports, Oracle presented an increase in total revenue, as revenue

from sales increased from $26.955 billion in 2014 to $27.520 billion in 2015 (Appendix A). This

represented a 2% increase. The bulk of these sales were derived from its software and cloud

sales, which represented a 76% of the total revenue in 2015, compared to 75% in 2014. This

increase in the software and cloud sales represents a 4% increase in revenue. The company’s

Hardware System revenue also contributed 14% to the total revenue in 2015, compared to 15%

in 2014. This shows a decrease in sales revenue by 1%. Just like the hardware system, the service

market also experienced a drop in revenue, as revenue accruing from this sector fell by 1%, and

this represents 10% of the company’s revenue.

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Figure 2.

Oracle revenue growth. This figure illustrates Oracle quarterly

revenue growth during 2Q2013-3Q2015

Operating Expenses (Year Ended May 31

2015)

Oracle’s operating expenses increased from $17.105 billion in 2014, to $17.631 billion in

2015. This represents a 3% increase in operating expenses, with the “Cloud software-as-a-

service” and “platforms-as-a-service” contributing the highest portion of the increase with a 63%

increase; Cloud Infrastructure-as-a-Service contributing a 14% increase; restructuring with a

16% increase, while Research and development contributed an 8% increase. Most operating

heads had a reduction, with the hardware systems products experiencing a decrease of 4%,

Acquisition related and other expenses experienced a 45% decrease.

Figure 3. Oracle total operating expenses.

This figure illustrates Oracle

quarterly operating expenses during 2Q 2013-3Q 2015.

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Net Income (Year Ended May 31

2015)

Oracle’s net income dropped by 2; with revenues dropping from $10.955 billion in 2014,

to $9.938 billion in 2015. Management blamed the international exchange rate for the drop, as

investors are also not happy with the situation, with stock also down by down 7% in after-hours

trading. Analyst predicted that will still be affected by foreign exchange rate, just like most large

international corporations have been off late.

In its 2015 Q4 results, Oracle reported a 5% drop in revenues of $10.7 billion, instead of

3% rise as in constant currency. The Software and Cloud revenues were down by 6% of $8.4

billion, instead of a 2% rise in constant currency. The Cloud software as a service (SaaS) and

platform as a service (PaaS) revenues were $416 million, growing 29%, and up 35% in constant

currency. Cloud infrastructure as a service (IaaS) revenues were $160 million, growing 25%, and

up 31% in constant currency. Hardware Systems Revenues were $1.4 billion, down 4%, but up

5% in constant currency.



Short-term Deferred proceeds were $7.2 billion, to some extent down, but were supposed

to be up by 9% in constant currency compared with a year ago.



Operating Cash Flow on a trailing twelve-month basis was $14.3 billion.



For fiscal year 2015, Total Revenues were $38.2 billion, essentially unchanged, but up

4% in constant currency.



Software and Cloud Revenues were $29.5 billion, up 1%, and up 5% in constant

currency.



Cloud SaaS and PaaS revenues were $1.5 billion, up 32%, and up 35% in constant

currency.



Cloud IaaS revenues were $608 million, up 33%, and up 36% in constant currency.

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

Total Hardware System Revenues were $5.2 billion, down 3%, but up 2% in constant

currency.



Operating Income was $13.9 billion, and the Operating Margin was 36%.



Non-GAAP Operating Income was $17.4 billion, and non-GAAP Operating Margin was

45%. Net Income was $9.9 billion, while non-GAAP Net Income was $12.5 billion.

Earnings Per Share was $2.21, down 7%, but unchanged in constant currency. Non-

GAAP Earnings Per Share was $2.77 down 3%, but up 2% in constant currency.

The company had astounding sales of $426 million of new Saas and PaaS annually

periodic cloud subscription proceeds in Q4. And it is anticipated that the speedily increasing

cloud sales will rapidly translate into significantly more revenue and profits. The SaaS and PaaS

proceeds grew at a 34% constant currency rate in the just concluded Q4, but it is anticipated that

revenue growth rate will rise to 60% if currency remains constant in this new fiscal year.

Figure 4.

Oracle net income. This figure illustrates Oracle’s net income from

2005-2015.

Earnings Per Share

Oracle reported unsatisfactory earnings to close out its fiscal year. Management claimed

that the unsatisfactory earnings were due to costs of a strengthening exchange rate for the U.S.

dollar. It reported earnings of $0.78, $0.09 below consensus of $0.87 earnings per share.

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Earnings per share were down 14% and 5% in constant currency. In order to remain competitive

in an ever changing market, the company is gradually shifting its positioning in the market to

promote the catch up game its playing in the cloud section of the market.

Figure 5.

Oracle’s trend earnings per share.

This figure illustrates Oracle’s

trend earning per share from 2013-2015.

Compare with Competitors and Standards

Oracle Corp. (

ORCL

) is an enterprise software company that develops, manufactures,

markets, distributes, and services database, middleware software, and applications software. It

provides a complete, open, and integrated business software, services, and hardware systems to

customers that include all sizes and industries.

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Figure 6.

Oracle’s revenue by operating segments.

This figure illustrates Oracle’s revenue by operating

statements in 1Q 2015.

The enterprise software market grew to $407.3 billion in 2013, an increase of 4.8% year-

over-year (Appendix B). Microsoft (

MSFT

) leads the market with a 16% market share (

Sinha, P.,

et all., 2015)

. It’s followed by Oracle. IBM (

IBM

), SAP AG (

SAP

), and Adobe (

SYMC

) are

other leading players that made it to the top five rankings. Microsoft continues to lead the

industry in terms of revenue, with a total of $93.6 billion (2015), $86.8 billion (2014) and $77.9

billion. They are followed by Oracle, with a distance $38.2 billion (2015), $38.3 billion (2014)

and $37.2 billion (2013). SAP presented a $17.6 billion (2014) and $16.8 billion (2013), while

ADOBE presented $4.4 billion (2014) and $4.1 billion (2013) respectively.

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Figure 7.

Global software revenue. This figure

illustrates global software revenue share in 2013.

Organization Analysis

Mission

Oracle's mission is to deliver the highest quality service information at the low cost, its

product and services must be the most reliable, fastest, most secure, most scalable and easiest to

use for all types of information. Oracle aims to do this by fostering an inclusive environment that

leverages the diverse backgrounds and perspectives of all employees, suppliers, customers, and

partners in order to drive a sustainable global competitive advantage.

In order to actualize this, the company intends has continuously delivered to its

customers, the best of information with the highest Quality of Service at the lowest cost.

According to Mark Hurd, (Co-CEO), the IT environments have become so complex that

in most enterprises the biggest chunk of IT budget is spent just keeping the lights on. The

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average company spends about three-quarters of its IT budget on integration, maintenance, and

routine tasks. This leaves the companies with only 25 percent to invest in innovation.

Due to the ever changing environment witnessed in the industry. In order to remain

competitive, Oracle’s mission is susceptible to changes. Hence the company’s product and

services will have to be the fastest, most accessible, most dependable, most secured, easiest to

use, for all types of information management.

Vision

“Oracle, wants to be the company that helps its customers achieve a spending balance.”

To fulfill this, Oracle uses three principles:-



Simplify – Enterprises must increase the speed of information delivery with integrated

systems.



Standardize – Enterprises must reduce cost and maintenance with open, easily available

technology.



Automate – Enterprises must improve operational efficiency with technology and best

practices.

With these principles in place, Oracle intends to help its customers simplify its IT setting,

so as to free up money, time, and resources that could be invested into innovation. This allows

Oracle to provide a wide-ranging and fully incorporated stack of cloud applications, platform

services, and engineered systems.

Core Values and Operating Guidelines

The following core values are crucial to Oracle’s business:



Integrity: Oracle employees must demonstrate honesty and sound ethical behavior in all

business transactions and personal integrity in all dealings with others.



Mutual respect: Oracle employees must consistently treat individuals with respect and

dignity.

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

Teamwork: Oracle employees must work together as a team for the collective interests of

the company.



Communication: Oracle employees must share information widely and effectively with

each other, except when confidentiality is required.



Innovation: Oracle employees must always seek innovative and creative approaches to

problem solving.



Customer satisfaction: Oracle employees must consistently treat customer satisfaction as

a top priority.



Quality: Oracle employees make excellence and quality a part of day-to-day work

processes and seek continuous improvement in all that they do.



Fairness: Oracle employees are committed to dealing fairly with customers, suppliers,

and one another.



Compliance: Oracle employees comply with all laws and regulations that govern oracle’s

business.



Business conduct: Oracle employees observe the standards that have been established by

oracle and act ethically in their approach to business decisions.

Corporate Governance

As a U.S. based corporation that is publicly traded, Oracle’s goal is to comply with the

laws of the United States and the laws of every country in which it conducts business. The

company provides an exhaustive public accounting and analyst information. It also provides

important information about its values and vision; the Board of Directors and Board Committees;

Executives; business ethics for employees, partners, and suppliers.

Since it is a U.S.-based corporation, the company ensures that it is in compliance with

government regulations such as the Sarbanes- Oxley regulations. In addition to this, it also

creates products and solutions that are intended to help other companies conform to the letter and

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spirit of Sarbanes-Oxley by increasing the control and efficiency of its customers over critical

business information and improving their financial transparency.

Corporate Governance Principles



Director Qualifications – A Nomination and Governance Committee assesses potential

Board members based on their level of independence, personality, and insight.



Director Responsibilities – The basic duty of the directors is to use their business

judgment, while acting in a manner they is believed to be in the best concern of the

company and its shareholders. Board members are to attend the Annual Meeting of

Shareholders, Board meetings, and meetings of committees on which they serve.



Director Compensation – The Compensation Committee determines the form and amount

of director compensation annually, in agreement with the policies and principles

established in its charter.



Chief Executive Officer Evaluation – The Compensation Committee conducts an annual

review of the CEO’s performance and compensation.



Board Evaluation – The Board, led by the Nomination and Governance Committee,

periodically conducts a self-evaluation to decide whether the Board and its committees

are running effectively.

Corporate Social Responsibilities

Oracle has a lengthy history of employee volunteerism, generous giving, reverence for

the environment, and a strong obligation for cultivating education. The company has never taken

the steps of recording their efforts for the benefit of their employees, shareholders, customers and

policy makers around the world- until now. The inventive spirit behind Oracle’s technological

accomplishment also drives inventive solutions and programs for the benefit of their

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communities. With programs such as “ThinkQuest”, the company enables students to create

educational websites, that builds understanding across cultures; and “Oracle Academy” which

collaborates with secondary schools to educate students.

Core Competencies

Oracle technologies can be found in almost all industry, and in the data hubs of 100 of the

Fortune Global 100 companies. The company develops and deploys hundred percent (100%)

internet-based enterprise software through its whole product line that includes: database,

business applications, application development, and decision support tools across industries such

as Communications, Financial Services, Healthcare, Insurance, Public Sector, Retail and

Utilities. As a result of this, the company has built the following competencies over the entire

period of its existence, and they are:



Simplicity of Product: Uncertainty seems to have turned into a normal operating process

in the business world. With the existing global economic state combined with the forces

of a hypercompetitive global marketplace, companies are affected in many ways.

Although businesses are feeling the test of stiff IT budgets, departmental cuts, and

resource constraints, a distinguished and important business need has developed: that’s

the need to simplify. In the business environment of today, revolutionary thinking

enterprises are taking a keen interest in what they need and what they don’t. Thereby

trimming superfluous expenditure, ditching practices that don’t drive revenue, and

restructuring complicated processes. Through a continuous investment on R&D, Oracle

has built a core competence in simplifying products used by its customers, and it has

become user’s top shop, when it comes to IT related products. The company believes

that, by striving for simplicity, it can introduce IT infrastructures that could cut through

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complexity, and eventually drive business benefits. With this competence, Oracle has

helped companies in the following;



Lowering costs by consolidating workloads onto fewer platforms



Optimizing infrastructure to reduce bottlenecks, accelerate performance, and

enable better real-time decision-making



Giving users faster access to critical information



Delivering faster time-to-value by eliminating complex system integration



Enhancing accountability and control over IT assets



Research and Development: R&D has constantly been a strategic focus at Oracle; hence

its spending on R&D has always been high. In the just concluded financial year, the

company spent over $5.4 billion on R&D. The firm’s position, as detailed in its annual

report, is “we intend to continue to invest significantly in our research and development

efforts, because, in our judgment, they are essential to maintaining our competitive

position.

Figure 8.

Oracle’s Research and Development Cost.

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This figure illustrates Oracle’s research and

development department cost.

Although Oracle has lacked behind Microsoft and IBM in terms of investment on

R&D, but in recent times it has improved, with the company marginally spending more

dollars than IBM in 2015. This investment in R&D, is expected to grow its market in the

highly competitive market.

Figure 9.

Oracle’s R&D comparison with competitors. This figure illustrates

Oracle’s competitors.



Production and Information Systems: As a premier maker of business software, Oracle

has been able build cost saving expertise by saving more than $1 billion in operating

costs through coordinated and streamlined business processes. Its three tier approach,

“simplify, standardize, and automate”, form the core of its money saving strategy. In the

creation of the service it provides to its customers, Oracle constantly strides to create

competitive advantage by providing its customers with a higher return on investment. It

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does this by lowering the total cost of its software by improving integration, decreasing

installation times, lowering administration costs, and improving the ease of use. "Our

lean manufacturing solutions increase marketplace efficiencies, providing customers with

quantifiable return on investment and competitive advantage" says Larry Ellison, CEO of

Oracle.



Acquisition: Oracle over time has turned acquisition into a core competence. Oracle is

following a strategy based on acquisitions in order to offer a complete package of

services to its customers, which will eventually go a long way in

ensuring the long-term

growth of the company. The company continuously seeks out to reinforce its product

offerings, fast-track innovation, meet customer demand more swiftly, and increase partner

opportunities.

An essential part of Oracle's Mergers and Acquisitions idea is its

dependable commitment to customer service and product support while attaining

financial return objectives and creating value for its shareholders. According to Forbes,

Oracle recently, acquired Maxymiser (Cloud Marketing Company), a leader in cloud

software that allows advertisers to enhance ad content positioned in individual browsers

so as to make the most of user engagement. Although Oracle is a comparatively late

player to the cloud computing market, it however chose to enhance organic growth

through an extensive succession of acquisitions to fuel growth. It is expected that this

acquisitions will aid the company hopes of catching up with adobe in the cloud business.

Organizational Broad Goals

Oracle's number one goal is to Identify and exploit customers’ full value by continuously

seeking new ways to strengthen its product offerings, accelerate innovation, meet customer

demand more rapidly, and expand partner opportunities.

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In order to actualize this goal, Oracle has implemented a merger and acquisition strategy

that has eventually become an integral part of the company’s philosophy. It consistently commits

to customer service and product support while achieving financial return objectives and creating

value for its shareholders. The rationale behind this strategy can be broken down into three key

principles namely:



Obtain a customer base that increases market share and revenue. This principle allows

Oracle to acquire companies such as PeopleSoft, Siebel and BEA Systems. This

acquisition will drive the company’s financials, while increasing its recurring revenues

and profits.



Buy into a new product line that fills a market gap. Oracle is able to buy into new

products or expertise that will help it fill the market gap. For example, the company

acquired Hyperion so that it could push into new market segments.



Technology deals that improve a core capability. It also acquired SAP’s Frictionless

Commerce, so that it could improve its core capabilities in the industry.

Organizational Specific Goals

Oracle’s specific goal is to continue to gain share and be the number one company in the

sales of DBMS, Middleware and application.”

Organization-Level and Business Unit Strategies

Business Level Strategies and Corporate Level Strategies

There are five business level strategies for firm to establish their positioned in strategy

against its competitors which are cost leadership, differentiation, focused cost leadership,

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focused differentiation, and integrated cost leadership/ differentiation (Hitt, Ireland, &

Hoskisson, 2015). Therefore, based on its internal resources, capabilities, and core competencies,

a company can choose between cost competitive advantage and distinctiveness competitive

advantage to implement their business strategy (Hitt, Ireland, & Hoskisson, 2015). Additionally,

there are two types of target market, which are broad and narrow market segment. However, in

this case, Oracle has selected integrated cost leadership and differentiation strategy to represent

their effective match between their strength, weakness, opportunity and threat to achieve success.

The integrated cost leadership/ differentiation strategy however makes Oracle to be able

to produce products with some differentiated features (Hitt, Ireland, &Hoskisson, 2015). By

using the integrated cost leadership/ differentiation strategy, Oracle is be able to adapt quickly to

new technologies and rapid changes in their external environments. Moreover, by concentrating

on developing two sources of competitive advantage increases their number of primary value

chain activities and support functions in which the firm must become competent.

Moreover, according to its corporate level strategy, Oracle can be determined a business

with low level of diversification strategy, because its revenue comes from three different segment

which are Software and Cloud, Hardware Systems, and Services. Software and cloud have 76

percent of its revenues, hardware systems have 14 percent of its revenues, and services have 10

percent of its revenues in 2014. Furthermore, a company that implements this diversification can

receive positive returns because they develop capabilities useful for these markets and can

provide superior service to their customers (Hitt, Ireland, & Hoskisson, 2015).

Relations Between Strategies and Goals

To align their strategies and goals, Oracle has been presenting an impressive and

advanced strategy compared to its competitor and a strong product suite and market alignment as

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well as customer support strategy. Moreover, Oracle also has stability and viability from its

management group by offering consulting, education, and support services to its customers.

Furthermore, they also offer services solution to help customers and partners maximize the

performance of their investments and their service is differentiated based on their focus on

technologies, extensive experience, and broad sets of intellectual property and best practices.

Competitor Strategies

Oracle faces intense competition in all aspects of their business. The nature of the IT

industry creates a competitive landscape that is constantly evolving as firms emerge, expand or

are acquired, as technology evolves and as customer demands and competitive pressures

otherwise change. Their customers are demanding less complexity and lower total cost in the

implementation, sourcing, integration and ongoing maintenance of their enterprise software and

hardware systems. Their enterprise software and cloud and hardware offerings compete directly

with some offerings from some of the largest and most competitive companies in the world,

including Microsoft Corporation (Microsoft), International Business Machines Corporation

(IBM), Intel, Hewlett-Packard Company (HP) and SAP. Moreover their competitors are also

smaller companies like Oracle's enterprise software and hardware offerings compete directly

with the offerings from some of the largest and highly competitive companies in the world,

including Microsoft, IBM, Intel, HP and SAP, and smaller companies like salesforce.com, and

Workday, among others. The company's hardware systems business competes with, among

others, systems manufacturers and resellers of systems; microprocessor/chip manufacturers; and

providers of storage products. The company also faces competition from open source software

initiatives in which competitors may provide software and intellectual property for free.

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However, the low barriers to entry in many of the company's market segments new

technologies and new and growing competitors frequently emerge to challenge the company’s

offerings. Therefore, technology markets are associated with low barriers to entry and rapid

advancements which give rise to many competitive products with the potential to effectively

reduce Oracle's dominant position. Moreover, the company or its competitors may take certain

strategic actions, including acquisitions, partnerships and joint ventures, or repositioning of

product lines, which invite even greater competition in one or more product categories.

SWOT Analysis

Strengths



Diversified geographic presence and customer base

Oracle has a diversified geographic presence and customer base, and the company has

strategically expanded its presence across the globe. It operates in more than 145 countries

and has been steadily expanding its geographic footprint. In addition to the traditional

markets for its services which include North America and Europe, the company has been

expanding its presence in emerging markets such as Asia Pacific, Latin America, the

Middle East, and Africa. Furthermore, Oracle also has a diversified customer base

belonging to different end markets. Also, the company’s customers include the top

aerospace and defense companies, global airlines, automotive companies, banks,

governments, high tech companies, insurers, manufacturers, medical device companies, oil

and gas companies, pharmaceutical companies, retailers, and so forth.

However, diversified geographic presence and customer base contributes to Oracle's

consistent organic revenue growth and reduces its dependence on any single country or

customer. Additionally, diverse geographic presence allows the company to maintain a

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strong growth pace in its target markets, driven by attractive market share expansion

opportunities and strong underlying market growth characteristics.



Strong software and cloud business

The company has established a strong software business that enabled it to maintain a

stream of recurring revenues. The company’s software and cloud business includes

software license updates and product support, new software licenses and cloud software

subscriptions, and cloud infrastructure-as-a-service segments (Oracle, 2015). Also it can

be said that Oracle is the leader in database software market. Moreover, according to

industry estimates, the company’s share in database software licenses market was more

than 45% in 2014. Oracle's revenue share is much higher that its four closest competitors

combined. The company is also a leader in application software and middleware markets.

Moreover, Oracle also enjoys high software renewal rates. The customers of Oracle

are primarily medium-to-large businesses, including customers in Fortune 1000. However,

Oracle’s strong growth is attributed to increase in the demand for software products and

subscription offerings, software license updates and product support offerings, and

increase the renewals of software license updates and product support contracts from

customers. The company’s strong software and cloud business, whose products and

services are offered on a subscription basis, would ensure a continuous stream of revenue

inflow over the years. Additionally, it also offers a strong recurring revenue base which

enables the company focus on future growth investments.



Inorganic growth strategy

The company adopts an inorganic growth strategy to enhance its products and

services, and expand its customer base. The acquisition that Oracle has done for years

enhances Oracle's cloud offerings. The company strong focus on growth through

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acquisitions strengthens its competitive position enhances the products and services,

expands its customer base, provides greater scale to accelerate innovation and drive

revenue growth.



Sustainable margins and cash flows

Oracle enjoys strong margins and cash flow conversion rates. In FY2014, the

company's operating margin was 38.6% while its net margin was 28.6%. In addition,

Oracle was able to convert 136.2% of its net income into cash from operations. This

condition has made Oracle inherent strength in the company's business model, which is

dominated by sticky revenues requiring lower cost of acquisitions and pricing power,

associated with products that command high switching costs. Moreover, the company's

strong cash flow generation capability supports its growth prospects. Strong cash flows

and margins provide resilience to the business operations and reduce vulnerability to

market declines. Cash flows enable the company to further finance growth at feasible

costs.

Weaknesses



Declining hardware systems business

Oracle’s hardware systems business revenues declined significantly over the years.

The hardware systems business which operates through hardware system products and

hardware systems support segments, reported similar decline in the revenues over the

years. However, even though the hardware systems support segment showed a recovery in

its revenues in FY2014 over its revenues in FY2013, but it could not hedge the loss due to

the decline in hardware systems products segment. This continuing decline in the

hardware systems business could put pressure on the company's other profit making

businesses, which in turn would impact the company's topline growth.

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Opportunities



Increased adoption of cloud computing services

The worldwide demand for cloud computing services is expected to grow

significantly in the coming years. The cloud computing has been increasing as it enables

companies to reduce their expenses related to upfront royalty or licensing payments,

investment in hardware infrastructure and other operating expenses. According to industry

estimates, the global public cloud services' spending is forecast to grow 22.8% during

2014 to 18 and even reach more than $127 billion in 2018. Therefore, it is projected in

2018, public IT cloud services will account for more than half of worldwide software,

server, and storage spending growth. Also, industry estimates suggest that global SaaS

market is expected to be major contributor to the cloud computing market.

Oracle has significant presence in the cloud computing market, since the company

has offered a broad portfolio of enterprise-grade software and hardware products and

services for private and public cloud computing environments. Moreover, the company

has been rapidly expanding in the cloud computing business to leverage the increasing

adoption of cloud computing services by the customers. As part of this transition, the

company expanded its sales team in the Asia-Pacific region. The expansion will enable

growth in this region, where the cloud market is in its emerging stages.

In addition, the company expanded its product line with addition of new cloud

products to its existing portfolio. This expansion is beneficial for Oracle to manage e-

commerce, customer engagement, order management, order fulfillment, loss prevention,

and brand compliance operations. Therefore, the continued portfolio expansion and cross-

selling of its flagship cloud products enabled the company to enhance its cloud bookings

as well as increasing adoption of cloud computing services and the company's strong

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portfolio of cloud products and services. Moreover, Oracle also coupled with continued

focus on expanding its cloud offerings hence it can provide them an opportunity to gain

new customers and increase its revenues.



Big data presents growth opportunity

Big data, which is a primary contributor to the pace of overall data growth, refers to

the large repositories of corporate and external data, including unstructured information

created by new applications including medical, entertainment, energy and geophysical,

social media and other web repositories. It also refers to the new analytics and other

technologies that are available to help people do things with the vast amounts of enterprise

and external data. Moreover, the company is keen to take advantage of this growth

opportunity to further organize, analyze, and interpret report on and act on information

from these high volume data sources. Furthermore, the company also offers analytics

software to leverage big data and enterprise data to enable organizations to analyze the

data. The company's growing presence, increased focus, and the positive outlook for the

end market provide it with an opportunity to gain more customers and increase its

revenues in future.



Positive outlook for mobile computing market

The increasing adoption of smartphones and tablets, touch and connected devices and

the increasing demand for mobile applications is leading the strong growth in the mobile

computing market. Furthermore, Oracle offers a range of software for mobile computing.

Also, the company further enhanced its mobile applications during the year. The

company’s growing mobile computing offerings and the strong growth in the end market

would enable Oracle to meet the increasing customer demand for mobile applications and

drive topline growth in the future.

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

Growing enterprise software spending

The enterprise software spending has been growing rapidly and is expected to grow

further. This growth is expected to be driven by key markets such as supply chain

management and customer relationship management. Also, growing adoption of on-

premises and SaaS will further drive a modest increase in worldwide software spending.

Furthermore, Oracle offers a broad portfolio of supply chain management applications that

customers can adopt as an entire suite or individual applications to enhance its revenues

and market share in the coming period.

Threats



Increased adoption of their database poses a threat to Oracle’s dominance

The increasing adoption of the database poses a threat to the company’s traditional

relational database business because the software license business faces threat from the

growing adoption of databases offered and a variety of other services that use in-memory

technology and new offerings at the database layer. Though the company has been

offering new database solutions, this market is dominated by open-source database

management systems offered by others. Actually, the increasing adoption of database by

the enterprises due to growing online applications, may also lead the migration of Oracle’s

existing clients to competitors which have a higher visibility over Oracle NoSQL

databases.

Further, many of the customers employ Oracle databases simultaneously; building a

middle layer of services components that allows the app to decide which database to use

for which workload. However, the slow adoption of the company’s databases and the

growing usage of open-source databases offered by the start-up technology firms would

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negatively impact the company’s traditional database business and adversely affect its

market share and revenues in the future.



Intense competition

The company faces intense competition in all aspects of its business. Evolving

technology and customer demands have been constantly changing the competitive

landscape. Key competitive factors in each of the segments in which the company

currently competes include total cost of ownership, performance, scalability, reliability,

security, functionality, efficiency, ease of management and quality of technical support.

The intense competition may increase the pricing pressures on the company and other

players operating in the same market. If the company’s competitors offer deep discounts

on certain products or services or develop products that the marketplace considers more

valuable, Oracle may need to lower prices or offer other favorable terms in order to

compete successfully. Any broad-based change to prices and pricing policies could cause

the company’s revenues to decline or be delayed as the sales force implements and

customers adjust to the new pricing policies.

Oracle’s competitors may bundle products for promotional purposes or as a long-term

pricing strategy or provide guarantees of prices and product implementations. These

practices could, over time, significantly constrain the prices that the company can charge

for certain of its products. Therefore, intense competition from existing and new hardware

systems or software competitors could impact Oracle's results of operations and business

prospects through fewer customer orders, reduced pricing, lower revenues or lower

profits.



Foreign exchange currency risks

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Oracle's revenue and operating income are subject to variability due to the effects of

foreign currency fluctuations against the US dollar. The primary currencies to which the

company is exposed include the Euro, Japanese Yen and British Pound. The company

derives a significant portion of its revenue and operating income outside the US, and

therefore its financial results may fluctuate due to the effects of such foreign currency

fluctuations. The company enters into foreign currency forward contracts so that increases

or decreases in the foreign currency exposures are offset by gains or losses on the foreign

currency forward contracts in order to mitigate the risks and volatility associated with the

foreign currency transaction gains or losses. However, these may not hedge the risk

completely leading to foreign exchange currency translation losses. Furthermore,

exchange rate fluctuations from time to time may significantly weaken the company's

results of operations and financial condition.

Advantages and Disadvantages of Each Strategy

Since Oracle implements differentiation strategy, it has significant aspect as an effort to

create demand for their distinct products and charge extra price which resulting in greater

revenue and higher profitability. The advantages of this strategy are the customers develop brand

royalty, powerful suppliers are not a problem because the company is geared more toward the

price it can charge than its costs, differentiators can pass price increases on to customers,

powerful buyers are not a problem because the product is distinct, and the threat of substitute

products depends on competitors’ ability to meet customer needs. However, there are also

disadvantages for this strategy, which are difficulty maintaining long term distinctiveness in

customers’ eyes and difficulty maintaining their price. Moreover, for Oracle, their success will

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depend upon their ability to develop new products and services, integrate acquired products and

services, and enhance their existing products and services. Furthermore, for its corporate level

strategy, Oracle is able to create value by sharing activities and sharing core competencies, which

is an information technology business. However, since it’s in the same industry, if the industry is

not in a good situation, the whole corporation will directly be affected.

Key Performance Indicators (KPI’s)

Oracle promises are supported by these foundations; integrity, respect, teamwork,

communication, innovation, customer satisfaction, quality, fairness, business conduct, and

compliance which are the company’s commitment to the customers. The technical expertise and

marketing including meet the real needs of customers better than its competitors, develop core

competencies which lead to higher level of customer satisfaction, and process integration to hold

the key are their key performance indicators. Moreover, they use Oracle Scorecard and strategy

management as a solution to define, communicate, and measure strategy and performance. As

more and more executives realize the effectiveness of KPI’s towards measuring and

communicating organizational goals, the need for a technology solution to define, measure and

communicate KPI’s is now stronger than ever. Oracle Strategy Management Solutions are part of

Oracle's market-leading suite of performance management applications, and enable organizations

to perform extended reporting and analysis through tight integration with the business

intelligence tools.

Functional Strategies

Marketing.

Oracle directly market and sell their products and services to businesses of

many sizes and in many industries, government agencies and educational institutions. They also

market and sell their products through indirect channels. Moreover, in the U.S., their sales and

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services employees are based in their headquarters and in field offices throughout the country.

Furthermore, their international subsidiaries sell, support and service their products and offerings

in their local countries as well as within other foreign countries where they do not operate

through a direct sales subsidiary. Their geographic coverage provides stability to their operations

and revenue streams to offset geography specific economic trends and offers them an opportunity

to take advantage of new markets for their products.

Furthermore, they also market their products worldwide through indirect channels. The

companies that comprise their indirect channel network are members of the Oracle Partner

Network which is a global program that manages their business relationships with a large, broad-

based network of companies, including independent software and hardware vendors, system

integrators and resellers that deliver innovative solutions and services based upon their product

offerings. The Oracle Partner Network program extends their market reach by providing their

partners with the resources they need to be successful in delivering solutions to customers

globally.

Finance.

Oracle follows the Generally Accepted Accounting Principles (GAAP),

Financial Accounting Standards Board’s (FASB), Accounting Standards Codification (ASC), and

applicable guidance issued by the United States Securities and Exchange Comission (SEC)

which requires management team to make assumptions that affect the amounts reported in the

financial statements and accompanying notes, even though sometimes actual results could be

differ from the estimation. Generally the estimations and assumptions of the financial statements

have been consistent with the actual experience.

Operations.

To produce their hardware products, they rely on both their internal

manufacturing operations as well as third party manufacturing partners. Their internal

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manufacturing operations consist primarily of materials procurement, assembly, testing and

quality control of their Oracle Engineered Systems and certain of their enterprise and data center

servers, storage systems and networking products. For all other manufacturing, they generally

rely on third party manufacturing partners to produce their hardware related components and

hardware products and they may involve their internal manufacturing operations in the final

assembly, testing and quality control processes for these components and products. They

distribute most of their hardware products either from their facilities or partner facilities. Their

manufacturing processes substantially are based on standardization of components across

product types, centralization of assembly and distribution centers and a “build-to-order”

methodology in which products generally are built only after customers have placed firm orders.

Production of their hardware products requires that they purchase materials, supplies, product

subassemblies and full assemblies from a number of vendors. For most of their hardware

products, they have existing alternate sources of supply or such sources are readily available.

Research and Development.

They develop the considerable majority of their products

internally. In addition, they have stretched their product offerings and knowledgeable property

through acquisitions of businesses and technologies. They also obtain or license intellectual

property rights in certain circumstances. Internal development allows them to maintain technical

control over the design and development of their products. They have a number of U.S. and

foreign patents and pending applications that relate to various aspects of their products and

technology. Moreover, while they believe that their patents have value, no single patent is

essential to us or to any of their principal business segments. Research and development

expenditures were $5.5 billion, $5.2 billion and $4.9 billion in fiscal 2015, 2014 and 2013,

respectively, or 14% of total revenues in fiscal 2015 and 13% of total revenues in each of fiscal

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2014 and 2013. Rapid technological advances in hardware and software development, evolving

standards in computer hardware and software technology, changing customer needs and frequent

new product introductions and enhancements characterize the software and cloud and hardware

markets in which they compete. They plan to continue to dedicate a significant amount of

resources to research and development efforts to maintain and improve their current product and

services offerings.

urchasing.

The company store revenues came from software, hardware systems, and

services. Moreover, Oracle purchases the majority of their hardware directly from manufacturer

and third party manufacturer. Moreover, they depend on suppliers to design, develop,

manufacture and deliver on a timely basis the necessary technologies and components for their

hardware products, and there are some technologies and components that can only be purchased

from a single vendor due to price, quality, technology, availability or other business constraints.

As a result, their supply chain operations could be disrupted or negatively impacted by natural

disasters, political unrest, port stoppages or other transportation disruptions or slowdowns or

other factors affecting the countries or regions where these single source component vendors are

located or where the products are being shipped.

Human Resources.

As of second quarter of 2015, Oracle employed approximately

132,000 full-time employees. Of these employees, approximately 49,000 were employed in the

United States and approximately 83,000 were employed internationally. None of their employees

in the United States is represented by a labor union; however, in certain foreign subsidiaries

labor unions or workers’ councils represent some of their employees. They rely on the continued

service of their senior management, including their Executive Chairman of the Board of

Directors, Chief Technology Officer and founder, their Chief Executive Officers, other members

ORACLE STRATEGIC PLAN

of their executive team and other key employees and the hiring of new qualified employees. In

the technology industry, there is substantial and continuous competition for highly skilled

business, product development, technical and other personnel. In addition, acquisitions could

cause them to lose key personnel of the acquired companies or at Oracle.

Moreover, they continually focus on improving their cost structure by hiring personnel in

countries where advanced technical expertise and other expertise are available at lower costs.

However, they may also experience increased competition for employees in these countries as

the trend toward globalization continues which may affect their employee retention efforts and

increase their expenses in an effort to offer a competitive compensation program. Additionally,

because they expense all stock-based compensation, they have changed and may in the future

change their stock-based and other compensation practices. Moreover, they continue to evaluate

their compensation practices and other changes they consider from time to time include a

reduction in the number of employees granted equity awards, a reduction in the number of stock

options, all of which may have an impact on their ability to retain employees and also impact the

amount of stock-based compensation expense that they record.

Information Systems.

As an expert in the business software, Oracle has put their

expertise to use in its company saving cost in the operating expense by coordinating and

streamlining all its business processes. They implement simplify, standardize, and automate from

their core business to their money saving strategy. Moreover, too create services to its customer;

Oracle continually progresses to create competitive advantage by providing its customers with

higher return on investment. The lower their total cost of its software by improving integration,

decreasing installation times, lowering administration costs, and improving the ease of use.

Analysis of Functional Strategies

ORACLE STRATEGIC PLAN

Functional strategies in every organization are affecting company performance such as

profitability, market share, human talent, financial health, cost efficiency, product quality,

innovation, and social responsibility. This emphasizes on how the functional strategies align with

the current condition of the company. From each segments, it can be said that Oracle functional

strategies have performed well. Although they still need to enhance their sales and marketing as

well as their operations and manufacturing systems.

Organization’s Improvement Initiatives

Improvement Initiatives

Oracle implements a Lean Manufacturing solution and Agile Manufacturing processes

that allows it increase its marketplace efficiency; providing customers with quantifiable return on

investment and competitive advantage (Oracle, 2005). However, Oracle evaluates their

disclosure controls and procedures under the supervision and with the participation of their

disclosure committee and their management.

Oracle is building industry strength around key verticals such as industrial manufacturing

in the Lean manufacturing area. Teams are working together to develop a cohesive worldwide

manufacturing strategy. With this strategy, Oracle hopes to



Develop a customer centric process that will

: provide brand consistency and

channel optimization; enable comprehensive order capture and fulfillment; and

improve revenue and margins through increased aftermarket support.



Synchronize its demand driven supply chain

: so as to effectively manage demand

in a multi-tiered distribution environment; globally optimize material and production

resources; and reduce logistics cost while improving on time delivery.

ORACLE STRATEGIC PLAN



Achieve manufacturing excellence:

by enabling paperless production to reduce

costs and improve quality; support flexible inventory replenishment and collaboration

requirements; support lean, agile manufacturing processes.

Alignment of Improvement Initiatives into Strategic Management

The evaluation of their disclosure controls included a review of their objectives and

design, as well as their implementation of the controls and the effect of their annual report

required by SEC. The evaluation is a quarterly basis; therefore the conclusions of management

regarding the effectiveness of the disclosure controls can be reported in their periodic reports.

These evaluation activities are to monitor their disclosure controls and to modify them as

necessary and they concluded that the method of their controls and procedures were effective

(Oracle, 2015).

Comparison of Improvement Initiatives

Oracle’s competitors, which are Microsoft Corporation (Microsoft), International

Business Machines Corporation (IBM), and Hewlett-Packard Company (HP), use different

improvement initiatives methods. Microsoft uses Microsoft Operations Framework (MOF) as its

improvement initiatives (Microsoft, 2010). Moreover, IBM implements lean and IBM business

process manager (IBM BPM) to provide an introduction to the key principles and benefits of the

key business value with limited effort (Schume, 2013). Also, HP uses the services excellence

review (SER) which is a six sigma quality initiative to evaluate complex server and storage

solutions objectively, either during or after their implementation (Hewlett-Packard, 2015).

Conclusion and Future of Organization

ORACLE STRATEGIC PLAN

Recommendations:

Oracle should continue to come up with innovative incorporated product, instead of

compelling customer to upgrade to several versions [this occurs due to new acquisitions].

As the time to innovation increases, the more is the business loss (

Chesbrough, H. (2007)

Had Oracle followed every so often, SAP market wouldn’t have established.

To Oracle’s credit, their engineering prowess and depth of expertise is world class, yet

their area of weakness is agility and speed of response to the market. The company exists

in an age of risk and uncertainty; hence globalization, new technologies and greater

transparency have combined to overturn the business environment (

Barsoux, J., &

Bottger, P. 2006). In this era, market leadership is even more risky, with companies

falling of the top three rankings increasing to 14% in 2008 (Reeves, M., & Deimler, M.

2013). In order to remain relevant and competitive, Oracle needs to learn to tune its

tentacles to pointers of change from the external environment, decipher them, and rapidly

act to improve or reinvent its business model and even reform the information landscape

of its industry.

Focus on building technical strength to enable easy innovation (Ahmed, P. K. 1998). For

decades, Oracle had been the leader of the enterprise software production industry,

providing its customers with software and services that keeps them up-to-date and

accurate business informatics at the lowest cost. This has made Oracle a leading partner

to numerous companies and multinationals in the world. The company should continue to

build on this strength, and it turn it will continue to generate more business.

Leverage strength from relational database management area.

ORACLE STRATEGIC PLAN

Acquisitions that gain competitive advantage must be continued (

Porter, M. E., Goold,

M., & Luchs, K. 1996). In order to attain market growth, Oracle has continued to use

acquisition as a corporate strategy. The company makes strategic acquisitions whenever it

deemed it necessary (Schwenk, C. R. 1995).

Over time, Oracle has acquired 66

companies that are strategically located in the Database, Middleware, Server,

Applications, and Storage System market. It has done this, so as to obtain a readymade

customer base that will eventually increase its revenue and market share. Some

acquisitions have not really worked out, while some have been integrated seamlessly.

Focus more on engineering its Hardware and Software together (

Regnell, B., &

Brinkkemper, S. 2005).

By doing this Oracle can lock-in its customers, while locking-out

its competitors (

John, G., Weiss, A. M., & Dutta, S. 1999).

Prior to the Acquisition of Sun

Systems, Oracle would easily do integration agreements with hardware companies like

HP, NetApp, etc., in order to deliver some business resource that will make its software

run faster. However, the acquisition of Sun System has placed Oracle in competitive

position, which will ensure that it does not co-engineer with other hardware companies.

Rather it wants to own and optimize for its exclusive benefit the end-to-end protocols by

which hardware and software communicate with each other; and will be a good

community player in the open source market. Other companies are seeking such

capabilities, hence they are vertically integrating directly or through hybrid partnership

such as the by EMC/VMware/VCE or NetApp/Cisco/VMware.

Increased spending on Research and Development. Innovation is the engine that drives a

company’s growth and profitability (Patterson, M. L., 1998).

It is not shocking in some

ORACLE STRATEGIC PLAN

industries that up to 50% of companies’ revenues are consequent from new products, with

these companies spending 10%-15% of their profit on fuelling innovation.

Figure 10.

The effects of research and development on growth and profitability

in company.

ORACLE STRATEGIC PLAN

Figure 11.

Oracle’s investment on research and development.

Oracle needs to increase its spending on R&D, in order for it to remain competitive

with Microsoft that invest a lot of resources into Research and development.

Figure 12.

Industry overview on research and development investment.

Oracle should avoid multiple versions of database release such as the 8i, 9i, 11i etc. This

causes customer to be unhappy because they are forced to upgrade from their old

database version to the newer version (higher cost to customer).

Future of Organization

I believe the combination of Mark Hurd and Safra A Catz will give the company a

stronger and precise vision for the future. As a former President and CFO of the company she has

taken a leadership role in the company since 1999 till date, and has so far had a very fruitful

ORACLE STRATEGIC PLAN

track record. On the other hand, Mark Hurd joined the company in 2010, bringing more than 30

years of technology industry leadership, computer hardware expertise and executive

management experience. Mark will oversee the corporate direction and strategy for Oracle’s

global operations, including sales, support, consulting, marketing, and alliances and channels. He

focuses on strategy, leadership, innovation, and customers.

Together with Safra, they intend to guide the company towards cost saving techniques

and better innovation, which will pushed by a gradual increase in its budget for research and

development. This is important, if it wants to continue being an industry leader in the future

because of increasing competition from companies such as IBM and Microsoft.

Conclusion

A significant trend in the software and computing industries has been a shift towards

what is known as cloud computing, an infrastructure that is based on centralized shared servers.

Under this model everything that a company needs in terms of computing will be located and

maintained off-site rather than in house. Furthermore, the same company that manages the

servers and physical equipment will also license a platform and software to a firm, which can

then be accessed over the internet as an on demand service. Under this model businesses are able

to save money on various costs including software service, which is a significant source of

revenue for Oracle. Cloud computing also offers more efficient processing, storage, and

bandwidth usage by centralizing the equipment and optimizing the software. There are a few

potential downsides to the cloud computing model, including concerns over the security of

centralized computing as well as concerns over the current limitations of bandwidth. A shift

towards cloud computing would be a difficult one for companies like Oracle and Microsoft, who

produce and distribute software to their clients in a traditional sense. The costs of developing and

ORACLE STRATEGIC PLAN

managing a cloud system are significant and provide barriers to entry. Companies like Amazon,

Salesforce.com, Google, Net Suite and Right Now Technologies are examples of those which

have already begun offering products based on cloud computing technology. In order to hold its

position as a player in a changing industry Oracle will need to develop products to suit

consumers' needs as the environment changes.

From our analysis, we strongly believe that the continuous acquisitions of companies

such as Seibel, BEA, and most recently BigMachines, Oracle for the near term will keep

strengthening its position as a one-stop shop for enterprise solutions using the same acquire-

integrate-repeat strategy it has used for many years now. This company is a juggernaut, so don't

expect it to fall victim to any major disruptions.

References

Ahmed, P. K. (1998). Culture and climate for innovation.

European journal of innovation

management

(1), 30-43.

Barsoux, J., & Bottger, P. (2006). Can we really master uncertainty?.

Financial Times

ORACLE STRATEGIC PLAN

Chesbrough, H. (2007). Business model innovation: it's not just about technology

anymore.

Strategy & leadership

(6), 12-17.

Hanna, S. (2014, June 12). Top 10: Lean manufacturing companies in the world.

Global

Manufacturing

. Retrieved from: http://www.manufacturingglobal.com/top10/38/Top-10:-

Lean-manufacturing-companies-in-the-world

Hewlett-Packard (2015). Services excellence review [Press release]. Retrieved from:

http://www8.hp.com/h20195/v2/GetPDF.aspx%2F4AA1-4242ENCA.pdf

Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2015).

Strategic management: Competitiveness

& globalization

(11

ed.). Stamford, Connecticut: Cengage Learning.

Microsoft (2010). Continuous improvement: A MOF companion guide [Press release]. Retrieved

from: https://www.google.com/urldownload.microsoft.com

Oracle. (2015). 2015 annual report of Oracle. Retrieved from:

http://investor.oracle.com/overview/highlights/default.aspx

Oracle company profile

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http://eds.b.ebscohost.com/eds/pdfviewer/pdfviewer?sid=46f1d64e-c5ee-42a7-a396-

d2c8b8d5f53f%40sessionmgr114&vid=4&hid=120

Oracle. (2015). Oracle’s successful record in automotive industry showcased [Press release].

Retrieved from:

http://www.oracle.com/us/corporate/press/016907_EN

Porter, M. E., Goold, M., & Luchs, K. (1996). From competitive advantage to corporate

strategy.

Managing the multibusiness company: Strategic issues for diversified groups,

New York

, 285-314. Reeves, M., & Deimler, M. (2013). Adaptability: The New

Competitive Advantage.

Own the Future: 50 Ways to Win from the Boston Consulting

Group

, 19-26.

ORACLE STRATEGIC PLAN

Regnell, B., & Brinkkemper, S. (2005). Market-driven requirements engineering for software

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Engineering and managing software requirements

(pp. 287-308). Springer

Berlin Heidelberg. Sinha, P., Wang, M., Scott-Kennel, J., & Gibb, J. (2015). Paradoxes of

psychic distance and market entry by software INVs.

European Business Review

(1),

34-59.

Schume, P. (2013, May 28). BPM voices: BPM and lean, a powerful combination for process

improvement. Retrieved from:

http://www.ibm.com/developerworks/bpm/bpmjournal/1308_col_schume/1308_schume.

html

Schwenk, C. R. (1995). Strategic decision making.

Journal of Management

(3), 471-493.

Yoffie, D. B. (1996). Competing in the age of digital convergence.

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(4), 31.

ORACLE STRATEGIC PLAN

APPENDICES

ORACLE STRATEGIC PLAN

APPENDIX A

Oracle Income Statement

Fiscal year ends in May. USD in millions except per

share data.

2011-05

2012-05

2013-05

2014-05

2015-05

TTM

Revenue

35,622

37,121

37,180

38,275

38,226

38,078

Cost of revenue

8,398

7,858

7,113

7,236

7,532

7,701

Gross profit

27,224

29,263

30,067

31,039

30,694

30,377

Operating expenses

Research and development

4,519

4,523

4,850

5,151

5,524

5,585

Sales, General and administrative

7,549

8,253

8,400

8,605

8,732

8,738

Restructuring, merger and acquisition

695

351

352

183

207

227

Other operating expenses

2,428

2,430

1,781

2,341

2,360

2,265

Total operating expenses

15,191

15,557

15,383

16,280

16,823

16,815

Operating income

12,033

13,706

14,684

14,759

13,871

13,562

Interest Expense

808

766

797

914

1,143

1,256

Other income (expense)

186

-141

106

120

Income before taxes

11,411

12,962

13,898

13,704

12,834

12,426

Provision for income taxes

2,864

2,981

2,973

2,749

2,896

2,925

Net income from continuing operations

8,547

9,981

10,925

10,955

9,938

9,501

Net income

8,547

9,981

10,925

10,955

9,938

9,501

Net income available to common shareholders

8,547

9,981

10,925

10,955

9,938

9,501

Earnings per share

Basic

Diluted

Weighted average shares outstanding

Basic

5,048

5,015

4,769

4,528

4,404

4,370

Diluted

5,128

5,095

4,844

4,604

4,503

4,469

EBITDA

15,015

16,644

17,626

17,526

16,838

16,507

APPENDIX B

Oracle’s Financial Information

ORACLE

MSFT

SAP

IBM

ADOBE

ORACLE

MSFT

SAP

IBM

ADOBE

Financial

2013

2014

Revenue USD Mil

37,180

77,849

16,815

99,751

4,055

38,275

86,833

17,560

92,793

4,147

Gross Margin %

80.9

70.3

48.6

85.5

81.1

ORACLE STRATEGIC PLAN

Operating Income USD Mil

14,684

26,764

4,479

18,777

423

14,759

27,759

4,331

17,790

413

Operating Margin %

39.5

34.4

26.6

18.8

10.4

38.6

24.7

19.2

Net Income USD Mil

10,925

21,863

3,326

16,483

290

10,955

22,074

3,280

12,022

268

Earnings Per Share USD

2.26

2.58

2.78

14.94

0.56

2.38

2.63

2.74

11.9

0.53

Dividends USD

0.12

0.89

0.85

3.7

0.48

1.07

1.01

4.25

Payout Ratio %

8.4

44.5

32.8

24.9

15.1

38.3

36.8

26.3

Shares Mil

4,844

8,470

1,195

1,103

513

4,604

8,399

1,197

1,010

508

Book Value Per Share USD

9.33

9.21

16.76

18.85

13.77

10.02

10.61

18.03

14.39

13.53

Operating Cash Flow USD Mil

14,224

28,833

3,832

17,485

1,152

14,921

32,231

3,499

16,868

1,287

Cap Spending USD Mil

-650

-4,257

-566

-4,140

-188

-580

-5,485

-737

-4,183

-148

Free Cash Flow USD Mil

13,574

24,576

3,266

13,345

963

14,341

26,746

2,762

12,685

1,139

Free Cash Flow Per Share USD

2.65

3.24

3.74

11.8

2.1

3.1

2.69

3.29

12.64

2.07

Working Capital USD Mil

28,820

64,049

1,005

11,196

2,520

33,749

68,621

436

9,822

2,108

Key Performance Indicators

ORL

MSFT

SAP

IBM

ADOBE

ORL

MSFT

SAP

IBM

ADOBE

Margins % of Sales

2013

2014

Revenue

100

COGS

19.13

26.01

29.73

51.37

14.46

18.91

31.02

30.02

49.99

Gross Margin

80.87

73.99

70.27

48.63

85.54

81.09

68.98

69.98

50.01

SG&A

22.59

26.24

29.72

23.03

52.79

22.48

23.76

29.59

24.22

52.94

R&D

13.04

13.37

13.57

6.24

20.38

13.46

13.11

13.27

5.86

20.36

Other

5.74

0.34

0.53

1.94

6.59

0.15

2.45

0.76

1.74

Operating Margin

39.49

34.38

26.64

18.82

10.42

38.56

31.97

24.66

19.17

9.95

Net Int Inc & Other

-2.11

0.37

-0.49

0.75

-1.64

-2.76

0.07

0.14

2.37

-1.24

EBT Margin

37.38

34.75

26.14

19.57

8.78

35.8

32.04

24.8

21.54

8.71

Profitability

2013

2014

Tax Rate %

21.39

19.18

24.36

15.58

18.58

20.06

20.65

24.68

21.19

25.73

Net Margin %

29.38

28.08

19.78

16.52

7.15

28.62

25.42

18.68

12.96

6.47

Asset Turnover (Average)

0.46

0.59

0.62

0.81

0.4

0.44

0.55

0.54

0.76

0.39

Return on Assets %

13.64

16.58

12.33

13.43

2.85

12.73

14.02

9.86

2.54

Financial Leverage (Average)

1.83

1.8

1.69

5.54

1.54

1.93

1.92

1.97

9.9

1.59

Return on Equity %

24.74

30.09

22.02

79.15

4.33

23.94

26.17

18.46

69.37

3.98

Return on Invested Capital %

18.74

25.07

17.98

29.24

3.99

17.1

21.11

13.36

21.41

3.78

Interest Coverage

18.44

64.06

25.29

49.57

6.28

15.99

47.6

47.83

42.29

7.05

Financial Health

ORL

MSFT

SAP

IBM

ADOBE

ORL

MSFT

SAP

IBM

ADOBE

Balance Sheet Items (in %)

2013

2014

Cash & Short-Term Investments

39.38

54.08

10.28

8.77

30.57

42.97

49.72

8.75

7.21

34.67

Accounts Receivable

7.39

12.28

14.6

25.22

5.78

6.74

11.34

12.51

27.08

5.49

Inventory

0.29

1.36

1.83

0.21

1.54

1.79

Other Current Assets

3.9

3.52

2.26

4.86

2.62

3.37

3.67

2.06

5.97

2.51

Total Current Assets

50.96

71.24

27.14

40.68

38.98

53.28

66.27

23.32

42.05

42.67

Net PP&E

3.73

7.01

6.72

10.95

6.36

3.39

7.55

5.46

9.16

7.28

Intangibles

41.54

12.45

61.43

27.77

51.8

39.61

15.73

66.36

28.64

48.13

Other Long-Term Assets

3.77

9.29

4.72

20.6

2.86

3.71

10.45

4.86

20.15

1.92

Total Assets

100

Accounts Payable

0.51

3.39

5.91

0.6

0.52

4.31

1.96

5.84

0.63

Short-Term Debt

2.11

2.16

5.44

1.67

1.16

4.95

4.88

Taxes Payable

1.11

0.42

1.6

3.67

0.27

0.46

0.45

2.28

4.33

0.45

Accrued Liabilities

2.26

2.89

6.85

6.07

2.15

2.78

5.14

8.55

6.13

Other Short-Term Liabilities

11.85

17.47

19.66

9.95

7.76

11.13

17.76

7.85

10.11

15.91

Total Current Liabilities

15.73

26.27

23.43

31.81

14.7

15.93

26.47

22.19

33.69

23.13

Long-Term Debt

22.61

8.85

13.59

26.03

14.44

25.09

11.98

18.13

29.84

8.45

Other Long-Term Liabilities

7.09

9.46

3.78

24.1

6.08

7.1

9.47

9.03

26.37

5.6

Total Liabilities

45.43

44.57

40.8

81.94

35.22

48.11

47.92

49.35

89.9

37.18

Total Stockholders' Equity

54.57

55.43

59.2

18.06

64.78

51.89

52.08

50.65

10.1

62.82

Total Liabilities & Equity

100

Liquidity/Financial Health

2013

2014

ORACLE STRATEGIC PLAN

Current Ratio

3.24

2.71

1.16

1.28

2.65

3.35

2.5

1.05

1.25

1.85

Quick Ratio

2.97

2.53

1.06

1.07

2.47

3.12

2.31

0.96

1.02

1.74

Financial Leverage

1.83

1.8

1.69

5.54

1.54

1.93

1.92

1.97

9.9

1.59

Debt/Equity

0.41

0.16

0.23

1.44

0.22

0.48

0.23

0.36

2.96

0.13

Key Ratios -> Efficiency Ratios

2013

2014

Days Sales Outstanding

60.99

77.98

83.78

116.38

54.77

57.87

77.83

83.59

128.09

52.44

Days Inventory

10.21

27.71

16.37

10.82

31.16

17.36

Payables Period

21.99

81.14

62.79

54.89

34.8

22.45

83.07

55.59

56.36

38.28

Cash Conversion Cycle

49.22

24.56

77.86

46.24

25.91

89.1

Receivables Turnover

5.98

4.68

4.36

3.14

6.66

6.31

4.69

4.37

2.85

6.96

Inventory Turnover

35.74

13.17

22.3

33.73

11.72

21.02

Fixed Assets Turnover

12.24

8.53

9.53

7.17

6.13

12.52

7.55

8.95

7.55

5.74

Asset Turnover

0.46

0.59

0.62

0.81

0.4

0.44

0.55

0.54

0.76

0.39

Oracle Business Plan

Prompt to Clone This Oracle Business Plan

Apply this example's core structure, strategic pacing, and structural hierarchy directly to your own topic.

What are you generating today?