R12 Decision To Re-implement or Upgrade

The information below offers best practices and advice to customers currently in 11.5.X who are not able to take decision to upgrade or re-Implement and who are in dilemma. After going through these details they can understand the benefits, pro and cons and decide either to upgrade or re-implement based on the business goals and requirements.

R12 is the latest and most advanced version of the E-Business Suite running on Fusion Middleware. Many of the technology components and new features in R12 will carry over to the Fusion Applications. For customers running earlier release of 11i, upgrading/Re-implementation to R12 will allow you to move to the Fusion Architecture in an incremental manner. Here are a few things to consider for R12

If you are moving from an existing release of Oracle E-Business Suite to Release 12, you should consider whether to perform a standard upgrade versus a reimplementation.

Let us understand the definition of Re-implementation and Upgrade.

Re-Implementation: If the legacy system from which you migrate your historical data is an earlier release of the E-Business Suite (i.e. Treat Current System as Legacy System) then your fresh implementation may be described as a “reimplementation”.

-Setup applications.

-Migrate data

-Migrate customizations

-Go live with small data

-Phased conversion of remaining data

Upgrade: Use of a process or Oracle Tool kit to ‘convert’ data from current Oracle Applications release to R12.

- Supported tools, utilities, and documentation used

- Entire data and application available after upgrade

- Clear, straightforward, proven method

Source: My Oracle Support
Note: Extended Support for Release 11i10 requires the minimum baseline patches defined in My Oracle Support Document 883202.1(Minimum Baseline Patch Requirements for Extended Support on Oracle E-Business Suite 11.5.10).

EBS Release Road Map:

Source:oracle open world/stevenChan

Release 12, which became available in January 2007, included major architectural improvements to the Financials products to support global and shared service operations, improve operational efficiencies, and reduce risk. It also incorporated the latest revisions to Oracle’s middleware and database technologies.

Release 12.1, which became available in May 2009, rounds out Release 12 with significant enhancements to the other product areas, including Procurement, Supply Chain Management, Human Capital Management, Customer Relationship Management and Master Data Management. It also contains usability improvements and centralized life cycle management.

There are few customers who are still in dilemma and not able to decide to go with Upgrade or re-Implementation but few customer based on the business goals and requirements have decided In favor of re-implementation and few in favor of upgrade

Gartner, the IT research and advisory firm, published research in February 2009 that advised caution and careful planning for the 11i to R12 transition. They found some customers experienced problems due to the architectural changes in the Financials, both with the end state software and with the transitional upgrade process. The paper recognizes that customers may use reimplementation as an opportunity to make fundamental changes to the configuration setups. “In a reimplementation, the user wants to leverage the new global financials functionality and may therefore revisit the whole conceptual design of their financials implementation.”

R12 has several important new capabilities, but this doesn't mean all customers should start planning an upgrade/Re-implement now. Existing customers should use the decision Criteria parameters to plan when they should consider moving to R12.

Decision Criteria:
- Current Oracle EBS Version.
- Oracle Skills
- Geographic’s Focus
- Legal Compliance and Market Force
- Implementation Scope
- Customizations
- Fusion Middle ware
- Risk Aversion
: Source: Gartner 

Why should Companies move to R12:
- Stay in Oracle Support to eliminate the de-support risk since older versions of Oracle EBS applications are not supported by Oracle Suppoort.
- Obtain better support when patches currently.
- Take advantage of Tech Stack improvements.
- Change in business directions.
- New Features and functionalities to assist business
- Replicate customization with oracle standard features and retire RICE components
Get Ready for Fusion.

Driving Factors:
- IT Drivers: Supportability, Stability, Improved performance, New Features, Reduce , maintenance cost, Out of box use, Retire Customizations.

- Business Drivers: New modules, New features and functionality, New requirements, Operational efficiency, Design improvements, Opportunity to re-engineer,More business-handling Capabilities.

Upgrade vs Reimplementation:















Before suggesting any approach or its pros and cons we should understand the requirments, Issues and business goals by raising few questions like.
1. What are the issue in the current 11i Version.
2. What is the scope of the resounces availability
3. What are the key reasons to go to R12.
4. What is the budget.
5. What is the scope of the Project (any new additions to the business , any additions to the existing modules).

In upgrade if there are more number of customizations then it will take more time, oracle provided scripts for the entire standard /seeded components, the customization requires careful planning and development effort for non standard components. In Re-Implementation , taking the advantage of new features and functionalities customer have the opportunity to improve upon the existing components either by eliminating or retiring few of the RICE components.

Upgrade:

Pros:

- Least Expense option
- Less Implementation time with low customization
- Shared services will work as prescribed
- No Major Process changes
- No changes to COA, Currency, Calendar
- No major Business/organizational restructuring
- No Data conversion.
- Small team compared to re-Implementation.

Cons:

-User Interface overhaul will change to look and feel of the application.
-Limited ability to change configuration.
-Certain Modules have significant modifications and enhancements
-Critical upgrade issues require oracle support for fix/solution.
- Reporting tools have been impacted hence Technical/Development cost will increase.
- Have to leave with existing Issues.
- Continue use of Tax code.
- May not be able to use the new tax accounting and compliance model (EBtax).

Re-Implementation:
Pros:
1. Reconfigure of existing Process hence opportunity to correct mistakes and optimize process.
2. Opportunity to cleanup existing bad data.
3. Opportunity to change configuration may improve data quality and optimize process.
4. Opportunity to use new features and functionalities there by reduces issues.
5. Avoid catch-up Patching.
6. Opportunity to eliminate /retire RICE componets by using addded features and functionalites and centralized architecture .

Cons:
1. Implementation Time will be high.
2. Expensive cost option (Training/Development/Resource/tesing etc)
3. Configuration time willl be high
4. Data convertion would be required.
5. Big team size compared to Upgrade.
6. Most complicated and Resource intensive option.

Options available:

1. Stay put on 11.5.10, Not Ready for R12.X. Do not see the business benefits to upgrade . Delay and  hope that 11i  supported will be extended for another 2 – 3 years as the deadline comes closer. Ready to pay higher support cost for extended support as applicable..( 20 % to 25 % extra license fee post Nov 2012 ).


2.  Ready for upgrade: Treat it as a necessary level. Do a Technical Upgrade with minimum cost and least disruption.


3. Embrace R12.X, as a Functional Upgrade; Treat it as a stepping-stone to Fusion. Adopt new processes, fusion middleware and new R12.X modules as applicable.


4. Re-implement to R12.X. Look to adopt more out of box solutions. Treat it as a Re-engineering exercise and simplifying business processes.


5. Expanding your Foot Print: You want to add more EBS Products to your footprint :Oracle recommends to  move to the higher version R12.1.3 frist as there would be number of new features and change to data model  and then implement the new Product. 

Refer the following documents for more information on oracle my support:
1104163.1 - R12.1 Financials Pre-Upgrade, Setup, and Operational Tips
889733.1 - R12: Upgrade Considerations by Product (FINANCIALS)
987516.1 - Planning Your Oracle E-Business Suite Upgrade from Release 11i to Release 12.1
954704.1 - EBS: R12.1 Oracle Financials Recommended Patches
1127593.1 - R12.1: Oracle Financials Pre-Upgrade Patch Supplemental List for EBS CUP
•394692.1 -Oracle Applications Documentation Resources, Release 12

780989.1 -R12: Upgrade vs. Reimplementation (Financials)
1098650.1 Oracle E-Business Suite Technology Stack Release Notes for Release 12.1.3
•1080973.1 Oracle E-Business Suite Release 12.1.3
Upgrade Advisor: Oracle E-Business Suite Financials and Projects Upgrade from 11.5.10.2 to 12.1.3 and 12.1.2 [ID 256.1]
394692.1-Oracle Applications Documentation Resources, Release 12
747735.1 - Oracle Financials and Oracle Procurement: Functional Upgrade Guide: Release 11i to Release 12
806593 1 – R12 1 Info Supply
•806593.1 R12.1 Center
398877.1 – R12.1 Live Advisor
804373.1 – R12.1 Value Proposition documents
461709.1- Oracle E-Business Suite Upgrade Guide
557869.1 -EBS: R12.0 ORACLE FINANCIALS CRITICAL AND RECOMMENDED PATCHES 
405627.1- Oracle Payables Release 12 Known Issues
549024.1 -11i Payment Documents Do not Exist in R12--How to create the payment documents from 11i data
578232.1-R12 Proactive Intelligence Center: Oracle Payables
471418.1-Oracle Payments Minimum/Dummy Setup For Direct Debit Funds Capture Processing
399362.1-Oracle Applications Release 12 Upgrade Sizing and Best Practices.
418649.1 -Advanced Global Intercompany (AGIS) in Release 12  - Setup, Transaction   Processing and Reports
552745.1 R12: Unable to Update Location Address for Locations Created in Accounting Setups In GL
415529.1 R12: Unable to See the Legal Entity List of Value in the Bank Account Owner Field 
•B31566-01-Oracle Applications Upgrade Guide: Release 11i to Release 12
810443.1 of the R12 E-Business Tax (EBTax) Upgrade for Order to Cash 
733855.1 Inventory Structure (Chapter 2: R12 Inventory User's Guide in a Note) 
463997 .1R12 New Business Group Not Shown in LOV when attempting to create Organization
784666.1TECHNICAL AND OPERATIONAL STANDARDS
987097.1 E-Business Suite Manufacturing Standalone Documentation - Release 12.1