Oracle%20Implementation%20ROI%20Case%20Study

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Oracle ImplementationROI Case Study

• September 10, 2003

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Agenda
Base Case Legacy System
Next Generation I-POWER
Infrastructure
Collaboration
Future
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Michael Stoeckert, CIO/CTO

• Prior to EPL Inc.
• Macromedia Java and Internet experience
• Ernst Young, Cognos eCommerce and
  Datawarehousing experience
• EDS Business Reengineering initiatives
• Price Waterhouse Coopers Study of EPL
• Recommendations for infrastructure products
• Re-architect Website and Products
• Increase staff

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EPL Background

• EPL Inc is a technology company that provides
  software solutions for the credit union industry.
  
• ASP solution for over one hundred Credit unions,
  600,000 members
• In-house solution for more than 600,000 members
• Beginning in 1977, EPL has a reputation for
  superior service and client satisfaction.
• Long-standing relationships with our clients.

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EPL Situation 2001

• In the competitive marketplace to provide
  information technology products and services to
  credit unions, EPL was experiencing
• Declining revenue growth
• After a profitable history, two consecutive years
  of losses

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EPL Product Offering 2001

• Core Product Offering (VISION)
• Implemented on a Unisys mainframe platform,
  accessible to user via a green screen text
  based interface
• Client Server (PLUS)
• Implemented a Windows based front-end to Vision
• Challenges
• Deficiencies were Major Cause of Business Decline
• Feature Additions Fixes Extremely Difficult
• MF/Distributed Environment
• Closed System with Arcane Languages
• System Modules Not Integrated
• No Relational Database
• Installation Issues -- touch every desktop to
  install

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Legacy System
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Growth

• Continuing with current technology platform,
  based on demonstrated performance and trends
• Flat to negative revenue trend
• Modest positive earnings possible only with
  extreme cost control

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Earnings and Economic Profit
Pre Tax Earnings
0
of Revenue Change
-1.7 -2.2 2.5
2.5 2.5 2.5
2002 2003 2004 2005
2006 2007
Different Signals!!
Economic Profit without i-POWER
0
Negative
2002 2003 2004 2005
2006 2007
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Unsustainable Business Model

• Prime example of why Growth is NOT Always Good
• The EPL Enterprise Value before i-POWER to all
  Investors was negative
• With this Business Model, Growth did not increase
  Economic Value.
• Low Earnings Rate was Offset byAsset Increases
  Necessary to Support the Growth.

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Agenda
Base Case Legacy System
Next Generation I-POWER
Infrastructure
Collaboration
Future
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Strategy Oracle and I-POWER

• Challenges
• Feature Additions Extremely Difficult
• Systems Modules Not Integrated
• No Relational Database
• Installation Issues
• Governmental Compliance Issues
• Customer Reliability

• Solution
• J2EE
• XML
• Oracle 9i AS
• Oracle 9i Relational Data Base
• Oracle 9i RAC
• Oracle Collaboration Suite

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Oracle Enabled Solution

• Manageability
• Oracle Enterprise Manager
• Scalability
• Increased Performance at High Transaction Volumes
  (RAC)
• Secure Feature Rich Environment
• Portal capability Out-of-the Box
• Oracle Technology Leadership (J2EE)
• Enables Better Controls to achieve Compliance
• Open Architecture Allows Rapid Product Feature
  Development
• Low Total Cost of Ownership
• Complete, One Stop Collaboration Suite

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Feature Additions
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Number of Defects Closed
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Defects Seen by Customers
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Training

• Intuitive navigation incorporated
• Training Time
• 2 days to 1 hour
• Teller immediately utilized iPOWER in the CU!
• Saves Credit Unions time when implementing the
  system as well as saving the ongoing cost of
  training new employees.
• Positively effect the CU bottom line.

Hours
16 hours
94 reduction!
1 hour
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Installation

• I-POWER client installations are both fast and
  easy to perform by the user.
• Installation Time
• Single client from 1 hour to 10 minutes
• Branch from 25 to 4 hours

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Next Generation - i-POWER
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Why Oracle 9iAS Portal ?
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i-POWER Forecast
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i-POWER Forecast
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I-POWER Roadmap
AR 1.0.0/MR 1.1.0
MR 1.2.0
MR 1.3.0
MR 1.4.0
MR 1.5.0
i-POWER
MR 1.6.0
MR 1.7.0
Future
June 2003
Winter 2003
Spring 2004
January 2003
October 2002
January 2002
1st In-House Production Install
Branch Controller Beta
Project Start
Beta Start
1st Open System Install- No Mainframe or
Microsoft!
1st ASP Production Install
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Agenda
Base Case Legacy System
Next Generation I-POWER
Infrastructure
Collaboration
Future
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Unisys Solution

• Provide Failover at a high incremental cost
• No load balancing, capital is not used unless a
  crisis occurs
• Customers still affected as failing over to
  redundant box is not instantaneous
• Only utilize 50 of total capacity.

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Oracle9i RAC Solution

• Provide cost effective Failover
• Load balancing, capital is used all the time
• Customers not affected as failover is
  instantaneous
• Available with any application using the oracle
  9iDB
• Small incremental cost
• Utilize 95 of total capacity due to low overhead
  of load balancing

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Oracle9i RAC Customer Reliability
Investment Cost to Maintain Very High Customer
Reliability
Unisys
9i RAC
In the financial services industry, reliability
is a key differentiator among institutions. Any
break in service will have long term negative
impact on the credibility of EPL AND EPLs
Client, the financial institution itself, in
terms of lost customers, revenues, earnings
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Increased Performance

• Oracle9i RAC provides EPL with increased
  performance and failover at high transaction
  volumes
• Fraction of the cost when compared to our legacy
  system.
• Oracle9i RAC empowers EPL to take advantage of
  the technological advancements in server hardware
  taking place every 6 months.
• We feel that it is not cost effective to buy
  systems to last 3 -5 years anymore because of the
  price performance advantage to systems that
  allow horizontal scalability, which RAC provides.

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Agenda
Base Case Legacy System
Next Generation I-POWER
Infrastructure
Collaboration
Future
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Pre-Oracle Collaboration Suite
Required Functionality Pre OCS
Email Calendaring Microsoft Exchange
Voicemail Fax 3rd Party Call Express Right Fax
Files sharing Microsoft Windows
Web Conferencing WebEx
Authentication Microsoft Active Directory
Workflow None
Wireless Voice Access None
Enterprise Search None
Integration None
Required by EPL to Provide Leading Edge
Service to Customers
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Oracle Collaboration Suite
Required Functionality Oracle Collaboration Suite
Email Calendaring Included
Voicemail Fax Included
Files sharing Included
Web Conferencing Included
Authentication Included
Workflow Included
Wireless Voice Access Included
Enterprise Search Included
Integration Included
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Total Cost Of Ownership!

• TCO is the only way to look at the economics for
  business communications.
• Hardware, Software and maintenance are only a
  fraction of the total costs
• Upgrades, Migration and Integration with 3rd
  parties is expensive
• Looking at TCO, Oracle Collaboration Suite
  results in tremendous cost savings.
• Oracle Collaboration Suite meets all of our
  communications needs in one application.
• This one stop shopping enables tremendous
  internal efficiencies.

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TCO per Employee per Year
745 Microsoft Exchange Platform
187 Oracle Collaboration Suite
-75!
Administration Labor 571
Administration Labor 142
License/ Maintenance 160
License/ Maintenance 34
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Hardware
Hardware
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TCOReducing Operational Costs

• Operating system consolidation
• System management consolidation
• Integrated installation of entire suite
  components
• No third parties required
• Efficient configuration deployment
• Improved diagnostics manageability

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Corporate Governance

• New Securities regulations around retention and
  supervision of email communication.
• Oracle Collaboration Suite
• A Consolidated Infrastructure
• Federated Search
• Currently developing a collaboration
  classification system that allows our compliance
  officer to review communications that appear to
  be in violation of corporate/regulatory policies,
  such as transmitting member information, dishonest
  conduct, and other forms of irregularities.

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Implementation

• Live Today!
• Email, Voicemail, Calendar and Oracle Internet
  Directory
• Accelerated process with Oracle Consulting
• Best practice implementation methodology
• Take the opportunity set it up for the enterprise
• Apply collaboration best practices
• Phased implementation approach
• Set up, migration and switch over without mixing
  environments

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Agenda
Base Case Legacy System
Next Generation I-POWER
Infrastructure
Collaboration
Future
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Key Insights

• In 2001, EPL faced crucial decisions regarding
  its long-term competitive position.
• Early results indicate EPLs Business
  Transformation and technology re-architecture
  enabled by its partnership with Oracle Sun will
  regain EPLs competitive edge.
• The Management Team quickly and effectively
  addressed the technology Challenges.
• Some solid quantitative proof points are starting
  to emerge.
• Cost reductions are resulting from this new IT
  architecture.
• Oracle Collaboration Suite is positioned to
  significantly cut business communication and
  collaboration costs.
• Quantitative proof points will continue to be
  monitored by EPL to assure strategy is on track.

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Future Plans

• Implement Oracle Files
• More than just a replacement to file servers
• Implement Web Conferencing with version 2
• Real-time collaboration for the enterprise
• Authentication for all applications through
  Oracle Internet Directory
• Centralized secure data and user profiles
• Implement Collaboration Suite wireless
  capabilities
• Further automation of corporate governance
  policies
• Proliferation of Oracle Portal through further
  integration
• Integration of Oracle Collaboration Suite with
  I-POWER

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Think Strategically

• Focus on standards and integration across your
  entire enterprise to interoperate efficiently
• Increasing need to optimize your business using
  technology
• Collaboration is mission critical to todays
  enterprise
• Youll have to run email on a relational database
• Disaster recovery for mission critical
  applications is required
• Regulations require auditability of all
  communications with your customers