Manufacturing. The metric matters.

The Oracle E-Business Suite manufacturing modules carry some of the most complex licensing metrics in the EBS catalogue. The choice of metric and the count of the users can swing the manufacturing module cost by a wide margin.

EBS manufacturing module pricing concerns the cost of the Oracle E-Business Suite manufacturing modules, including the discrete manufacturing, the process manufacturing, the cost management, and the planning modules. The manufacturing modules carry complex licensing metrics, with the user metric, the named user, and the application user definitions shaping the cost. The choice of metric and the count of the users can swing the manufacturing module cost by a wide margin. Understanding the pricing dynamics is central to the EBS manufacturing negotiating position.

This article walks through the EBS manufacturing pricing framework. The metric structure and how the user definitions shape the cost. The module bundling and the dependency between the modules. The user count analysis that establishes the genuine requirement. The shelfware exposure in the manufacturing footprint. The negotiation approach that resolves the manufacturing cost on the buyer side terms. The framework applies to organisations licensing the EBS manufacturing modules.

The metric structure.

The metric structure governs the manufacturing module cost through the user definitions. The application user metric counts the individuals authorised to use the module, the named user metric counts the named individuals, and the other metrics count the relevant usage units. The choice of metric and the count of the users shape the manufacturing module cost, with the metric structure central to the cost.

The metric structure creates the counting complexity. The manufacturing modules are used by the direct users, the shop floor operators, the planners, and the indirect users, with the question of which users require the licence central to the cost. The accurate determination of the licensable users against the metric definitions is the foundation for the buyer side position on the genuine requirement.

The structural response is the careful analysis of the metric structure. The user definitions should be mapped against the actual users, with the analysis establishing the licensable user count against the genuine usage. See the EBS negotiation pillar and the Oracle Named User Plus audit issues article.

The module bundling.

The module bundling shapes the manufacturing module cost through the dependency between the modules. The manufacturing modules depend on the underlying modules, including the inventory, the bill of materials, and the cost management, with the dependency requiring the licensing of the supporting modules. The module bundling can inflate the cost through the requirement to license the supporting modules.

The module bundling creates the question of the genuine requirement. The supporting modules may be genuinely required, or they may be bundled into the requirement without a genuine usage. The analysis of the module dependency against the actual usage establishes the genuine requirement, with the buyer side position resisting the bundling that inflates the cost beyond the genuine usage.

The structural response is the analysis of the module bundling against the genuine usage. The module dependency should be mapped against the actual usage, with the analysis establishing the genuine requirement. See the EBS renewal negotiation article and the Apps Unlimited deal type page.

The user count analysis.

The user count analysis establishes the genuine manufacturing user requirement against the actual usage. The analysis maps the authorised users, the active users, and the indirect users against the metric definitions, with the measured reality providing the foundation for the buyer side position on the genuine user count. The user count analysis distinguishes the genuine requirement from the inflated user count Oracle would assert.

The user count analysis identifies the inactive users and the over counted users. The authorised but inactive users, the duplicated accounts, and the over counted users inflate the user count, with the accurate analysis establishing the genuine licensable user count. The accurate map of the users against the metric definitions is the foundation for the buyer side position.

The structural response is the completion of the user count analysis before the negotiation. The analysis should map the users against the metric definitions, with the genuine user count established before the negotiation. See our audit defense service and the Oracle Negotiation Playbook white paper.

The shelfware exposure.

The shelfware exposure in the manufacturing footprint represents the licensed but unused modules and users. The over licensed manufacturing modules, the unused supporting modules, and the over counted users represent the shelfware that inflates the manufacturing cost. The shelfware removal reduces the manufacturing cost, though it is governed by the repricing risk.

The shelfware exposure accumulates over the years as the manufacturing footprint evolves. The modules licensed for the projects that were never deployed, the users authorised for the roles that no longer exist, and the supporting modules bundled into the original purchase accumulate as the shelfware. The analysis of the genuine footprint against the licensed footprint establishes the shelfware exposure.

The structural response is the analysis of the shelfware exposure in the manufacturing footprint. The genuine footprint should be mapped against the licensed footprint, with the shelfware exposure established for the renewal negotiation. See the Oracle Database product page.

The negotiation approach.

The negotiation approach resolves the manufacturing module cost on the buyer side terms. The approach establishes the genuine requirement against the user count analysis, resists the module bundling that inflates the cost, removes the shelfware where the repricing permits, and negotiates the manufacturing cost at the appropriate level. The negotiation approach resists the Oracle tendency to assert the maximum user count and the full module bundle.

The negotiation approach draws its leverage from the analysis and the alternative options. The buyer side that can demonstrate the genuine user count, the genuine module requirement, and the option to reduce the footprint holds the leverage to negotiate the manufacturing cost at the appropriate level. The well prepared buyer side resolves the manufacturing cost without accepting the over stated requirement.

The structural response is the prepared negotiation of the manufacturing module cost. The buyer side should present the user count analysis, resist the bundling, and negotiate the cost at the appropriate level. See our contract review service.

Putting it together.

The EBS manufacturing modules carry some of the most complex licensing metrics in the EBS catalogue. The metric structure, the module bundling, the user count analysis, the shelfware exposure, and the negotiation approach each shape the manufacturing module cost. Buyer side teams that analyse the metric structure and the user count resolve the manufacturing cost at the appropriate level, while the teams that accept the Oracle assertion pay for the over stated requirement.

For the broader framework see the EBS negotiation pillar.