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Are packaged applications becoming less relevant?

Or are they the only way of keeping up with demand?

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The imminent death of traditional packaged applications for dealing with ERP, CRM and other core business requirements has been proclaimed in many quarters recently. Whether it’s SOA purists telling us that we’ll all be self-assembling solutions from components, enthusiasts of modern development environments wanting to build everything from scratch, or the SaaS evangelists saying it’s all going to go into the cloud anyway, it is trendy to dismiss application software packages as being out of touch with the needs of the 21st century.

Even if you take the disruptive rhetoric with a pinch of salt, however, there is no denying that some of the underlying points being made by the challengers touch a nerve. Most of us can probably think of at least one instance of a packaged application doing a great job initially, but ultimately becoming a straightjacket on the business. All too often, organisations have become constrained by packaged applications that couldn’t be adapted quickly or cost effectively enough to keep up with changing requirements.

The significance of such historical rigidity is contrasted by a lot of the language we hear today surrounding IT in general. It’s almost impossible to listen to a sales pitch or browse a supplier website without having words such as ‘flexibility’, ‘agility’ and ‘responsiveness’ thrust at you.

This is not just because people have been burned in the past, but also an acknowledgement that both the IT and business sides of the equation are becoming much more dynamic in general. As technology advancement enables businesses to do things more quickly and in different ways, this perpetuates the need for even more efficient and effective IT in order to keep up, and so the relentless spiral of need continues.

Another couple of words that frequently crop up today are ‘empowerment’ and ‘productivity’, underlining the increased emphasis on that most valuable and costly of resources – the workforce. Sometimes this boils down to providing employees with the information and access they need to innovate and generally make better decisions. But it could also simply be about broadening the reach of systems so more people can participate electronically in important business processes. In practice, this takes us into areas such as business intelligence, collaboration, mobile/remote access, and so on, all areas that have received a lot of attention over recent years.

The upshot is that the old days of static packaged applications serving the needs of selected groups sitting behind the firewall in a very prescriptive way are probably over. But is it a case of driving everything back to more of a DIY approach, as the challengers suggest? Well here we have to consider some practicalities.

While application packages may have had their issues, many organisations actually have more of a problem with custom built applications. In lots of environments, the maintenance of bespoke legacy is not only tying up valuable budget, but is also effectively a dead-end in terms of migration.

As we look to the future, do we really want to carry on reinventing wheels and potentially creating even more burdens of this kind? Indeed can we afford to, as the automation footprint expands from the back office to the front office and even to the field and the employee’s home? Throw in the need for collaboration, coherent and pervasive business intelligence and further functionality and that’s a lot of software to design, build, test and integrate if you don’t take full advantage of pre-built software suites.

While this might sound like volunteering to get tied up in even more constraining ways, the good news is that the packaged application business has not stood still. Most modern solutions are designed and built with a lot more flexibility in mind. Today, ‘configuration’ is the watch word, allowing a lot more tailoring of functionality without the need for coding.

From an architectural perspective, componentisation and SOA have then often been embraced to allow easier interfacing, reuse and substitution of components, reducing the cost, time and risk associated with integration. And in terms of user empowerment and productivity, the hooks are generally there for extension of functionality and access, either via standard options or third party solutions.

So, are we all sorted then?

Maybe in some cases, but the truth is that both vendors and their customers can only move so quickly, and while the latest incarnations of ERP, CRM and other packaged applications promise a lot, migrations and new implementations consume both time and resources.

With this in mind, we would be interested in your thoughts and experiences. How are needs evolving in your organisation, for example in the areas of analytics, collaboration, broader access by non-traditional users, etc? And if requirements are changing, how are packaged applications and/or the teams looking after them being stressed as a result? Looking forward, do you then have any tips on how to strike a balance between packages and custom solutions?

It would be great to have your views in the comment section below.

Freeform Dynamics Ltd

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