Yes obviously when you create an index execution plan would show you index lookup. When there is no index execution plan will show you the full table scan. But you need to determine on your query which column the index needs to be created. Once you create an index you need to collect the stats as Vijay Suggested. Decide on what column index needs to be created and see the execution plan and the performance of the query.

Optimizer mode could be either CHOOSE or FIRST_ROWS. Please check that. It cannot 10.2.0.3 thats the database version.