Wednesday, October 8, 2008

Oracle Buys Primavera

Primavera is a leading project management tool. Today Oracle announced that it acquires Primavera.

Primavera has a very popular project scheduling software. Primavera purchase gives Oracle a very good position to the industries like engineering and construction, aerospace and defense, professional services, etc.

In the past few years, the project management software has moving toward, or at least, vendors and analysts are pushing toward, a project portfolio management (PPM) solution. The idea is that an enterprise project management suite that consists of project costing, project billing, project cost management, project scheduling, project collaboration, project resource management, and project portfolio management.

There are several drivers leading us to this strategy and position:

1. Project oriented organizations are adopting the central Project Management Office or Program Management Office (PMO), which establishes the management standards and provides supports for project managers and program managers. An integrated, enterprise level, project management solution is required for supporting the needs of PMO.

2. In the project management software area, many vendors, especially Primavera, has been educating and demostrating the application of integrating the project scheduling with project cost management via earned value analysis. It is now a common expectation that the project software not only supports the scheduling needs of individual project managers, but also provides built-in functionality to track all types of project costs throughout the project lifecycle.

3. Professional Services Automation. Beyond the basic billing and financial related processing needs, the professional service organizations are looking for a resource management solution that can help them to optimize resources. They are also interested in automating its project management process and improve its workforce collaboration among the project team members and the key project stackholders. The integrated colaborative solution includes document and file management, deliverable tracking, and change management.

4. Web based project management tool. The web makes the sharing of project management information very easy. The web based project management not just allow the user to share the information, it also allows the project managers to manage projects, and tracking project progress.

5. IT are asked to justify their investments. Project portfolio management solution which applies the finanical porfolio management theory to analyze and justify the company's project investment arised.

The opportunities and demands are out there, however, it was not easy for ERP to extend its support from a project costing and billing based solution to cover the enterprise project management. It is not about the software but about the mind set and about customer's deployment environment. Many organizations may not even standardize the project management software solution. The project world is actually divided into different sub groups.

There are people who are close with the project execution and would like to have weekly or daily project status and progress traking. There are people who just view project with a somewhat high level with an external or customer facing information. There are again another set of people treat project are high level financial buckets for tracking the resource and expense and may not require any level of breakdown. The different sub groups have different project information needs and required different structure of the data. They may also claim the ownership of their own view and their own data.

With the purchase of Primavera, Oracle now is in a very good position to remove the problems. It would be very interesting to watch how the industry evolves.
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