Business software

The Rise and Evolution of Enterprise Software Platforms

For many years, business and IT experts have debated which software selection strategy is best: a single-use solution or an enterprise resource planning (ERP) solution. The debate is just as vigorous when it comes to building or buying the solution. Google any of these topics and it’s overwhelming to see the millions of results that have been posted.

The decision requires a lot of research, experience, and foresight, and decision makers have a responsibility to consider many factors, such as the company’s long-term vision and growth plans. And, even with good planning, there have been quite a few notorious ERP implementation disasters.

The software strategy and selection process carries many operational and financial risks, but there have been many successes in implementing ERP and single-purpose solutions. The alternatives I gravitate towards are solutions that straddle fully integrated ERP and single point solutions, leverage the cloud, and have proven best practices built in and out of the box.

The opinion of a CIO

The term “integrated solution” usually means ERP for many technicians. These are solutions that cover almost every business process in the company, or at least they try to. As a CIO who spent nearly 10 years leading the implementation of an ERP solution spanning over 80 manufacturing sites with end-to-end business processes, I learned first-hand the value and the power of integrated solutions. I also learned about the many challenges and risks they present.

To successfully implement ERP solutions, companies must have the wherewithal to invest heavily, have strong business processes and IT governance, and have the stamina to manage the implementation over several years.

On the other end of the spectrum, a single-use solution is just that. Often, the need to integrate with other systems – or at least closely related ones – quickly becomes apparent.

This potential need for integration is one of the biggest issues I’ve encountered with single-use solutions. This leads to the development of multiple interfaces that must be maintained, which significantly complicates the IT landscape within an organization. For example, if a company implements the best purchasing and manufacturing systems, it is almost mandatory that these systems integrate to manage supply chains and be efficient.

The Rise of Enterprise Software Platforms

With the increase in cloud adoption over the past 10 years, a new generation of software solutions has emerged. These solutions can be thought of as enterprise software platforms designed around a subset of closely related business processes, even if the initial design was intended for no more than a one-time-use solution. These solutions do not cover all business processes of the company from their conception, but they are designed taking into account other business processes upstream and downstream. This makes enterprise software platforms much more easily expandable into other areas.

Key features of these solutions include:

1. Unparalleled subject matter expertise in the business processes they cover.

2. Extreme flexibility, with configurable platforms that simultaneously deliver out-of-the-box best practices.

3. Software-as-a-service (SaaS) systems that are scalable and take advantage of the cloud.

4. The ability to integrate and interface with other solutions.

Forbes contributor Adrian Bridgwater discusses the idea that a platform has the ability to interconnect with other software and can be extended beyond its originally intended purpose. Salesforce is a great example where the software has evolved into a powerful platform that is used for many related business processes in both B2C and B2B models.

It’s important to recognize that the modern IT landscape of many agile companies already includes a mix of single-purpose solutions, platforms, and fully integrated ERP solutions.

The Evolution of Enterprise Software Platforms

Complexity and risk are the main reasons to consider enterprise software platforms, as they are much less complex than ERP solutions. These platforms usually extend to two or three departments of the company to be involved in the implementation, and they can be positively extended beyond their initial intended use.

However, ERP solutions can touch all departments of the business when implemented and require an army of IT professionals. Enterprise software platforms have proven to be easier, cheaper, and faster to implement, which means far less risk and a lower total cost of ownership.

Faster return on investment (ROI) is just another key benefit of enterprise software platforms. Because they are often built by subject matter experts who focus on a specific set of processes, these platforms tend to be faster to implement and provide faster realization of benefits including efficiency, cost savings, competitiveness and compliance.

Choose a solution

Regardless of the type of solution, here are my key considerations for decision makers to keep in mind:

• Benefits must be quantifiable and support business objectives.

• Ensure that there is full knowledge of the organization’s needs, means and capabilities, including IT.

• Be realistic and practical about what the business can afford, including the extent of change and disruption the organization may experience.

• Full support across the organization is needed, especially from stakeholders impacted by the decision.

• A change management plan should be developed with HR in anticipation of the inevitable resistance.

• Define the necessary business process governance and ownership before involving process owners in the selection process.

• Select a solution that can tailor its functionality to a company’s individual business requirements.

• Ask for references and discuss the solution provider’s experience in the same process.

• Seek legal assistance to understand the contractual commitment made and what you can expect from the solution provider.

These factors will help decision makers choose the solution that best suits the business. Overall, it is best to consider the impact of the solution on the business and its operations.

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