Oracle Cloud ERP customers will soon be able to embed banking and logistics services into the platform for B2B transactions.
The new Oracle B2B Commerce network is aimed at reducing the cost and complexity of conducting B2B business between Oracle Cloud customers. The service was unveiled at this week's Oracle CloudWorld 2022 conference.
The initial rollout of Oracle B2B Commerce will include integrations with JPMorgan Payments for finance and FedEx for logistics, according to Oracle.
With this new service offering, corporate buyers and sellers will be able to digitize and automate transactional processes end to end, said Natalia Rachelson, group vice president of outbound product management for cloud applications at Oracle.
"It's about simplifying and reducing the cost of B2B transactions, providing better employee and customer experience and enabling service providers to offer new services to their customers," Rachelson said.
For example, if a hospital needs to buy an expensive piece of equipment like an MRI machine, it can place an order to a supplier through its Oracle Cloud ERP system, and the supplier also using Oracle Cloud ERP can arrange delivery logistics through FedEx, she said.
If it needs financing to purchase the equipment, the hospital can click on the JPMorgan button within Oracle Cloud ERP and create a financing request.
Accessing FedEx provides the supplier with real-time rate quotes, routing options and transit information, while the buyer has a simplified finance approval and payment process, according to Rachelson.
JPMorgan and FedEx will be the initial financial and logistics providers available in B2B Commerce, with more to come, she said.
While a release date has not been specified, Oracle B2B Commerce will be available in an upcoming upgrade to Oracle Cloud's 40,0000 customers as a standard functionality in Oracle Cloud ERP at no additional cost.
Embedding services into ERP is trending
Oracle B2B Commerce is another example of the trend to embed services like banking into ERP systems along with SAP Multi-Bank Connectivity, Sage Digital Network and Oracle NetSuite's integration with HSBC, according to Predrag Jakovljevic, principal industry analyst at Technology Evaluation Centers.
"Doing banking from ERP … will reduce the cost of custom integrations and probably will free up some accounts payable resources," Jakovljevic said.
The trend centers around breaking down barriers between ERP systems and enterprise transactional and financial systems, according to Jon Reed, co-founder of Diginomica, an enterprise applications industry analysis site. The integrations enable companies to rethink ERP as more than just back-office systems and helps build a better argument for moving to the cloud.
"Cloud may save costs on things like consolidating instances, but infrastructure costs on the cloud are not cheap," he said. "But you can justify that through all these business services that give you a different kind of business case."
Jon ReedCo-founder, Diginomica
Overall, the B2B Commerce offering is a positive development for customers and indicates the value of cloud ERP, Reed said.
"It becomes a much more persuasive value proposition when your ERP system helps you to conduct this kind of business without complex integration," he said.
It's possible to build these kinds of integrations with on-premises ERP systems, Reed said, but it's much more laborious and costly, and companies need to maintain the integrations after they are built.
However, Reed cautions that while the trend for embedding services into ERP like Oracle B2B Commerce is promising for customers, it's still early days.
"B2B Commerce has just been announced, and they're not serving thousands of customers yet," he said. "So this is the early stages, and we'll have to see what the adoption looks like."
Jim O'Donnell is a senior news writer who covers ERP and other enterprise applications for TechTarget Editorial.