The odds are good that the LAMP stack is running somewhere inside your company. The acronym refers to the foundational foursome of the open-source movement: the Linux operating system, Apache Web server, MySQL database and, collectively, the Perl, PHP and Python programming languages. Development tools such as Eclipse and application servers such as JBoss have also gained popularity—and trust—especially now that major vendors such as IBM, BEA Systems and Borland have adopted or supported them commercially. But what about the next step up the software ladder? Is open source ready for ERP, business intelligence or CRM?

Ready or not, it’s happening; the first industrial-grade applications in these areas are now emerging. And CIOs will soon need to decide how to approach these fresh options in their enterprise software catalog. As with the adoption of the LAMP players, these new open-source enterprise applications likely will find their way into the enterprise at a departmental or small-project level. As a result, "we don’t see [these applications] on CIOs’ agenda at all," notes Michael Goulde, an open-source senior analyst with Forrester Research. But, he warns, "CIOs should sync up with their development teams to see [where such applications] might have payback to the organization."

However, CIOs should tread carefully on such open-source applications, advises Mark Lobel, a partner at PricewaterhouseCoopers who focuses on information security, including security for financial applications. One key concern is that applications tend to reflect and embed business processes and logic, which often are key strategic assets you don’t want to share with others—and open-source licenses can require such sharing if companies aren’t careful. Another issue is the long-term viability of open-source applications for specific functions. Open source depends upon volunteer developers for success, but the more niche a product, the smaller the potential pool of interested contributors. As such, grassroots support for specific apps such as ERP or CRM tools may look more like brigades than the armies now supporting broad open-source infrastructure such as Linux, Apache and MySQL.

Still, properly managed open-source applications can save enterprises money and time—as well as reduce dependency on specific vendors.

Finding a Fit

Financial-services giant Fidelity Investments has used open-source technology for about four years to reduce costs and dependence on vendors. "We started with Linux like everyone else did, but our intent all along was to see how far up the stack we could go," says Charlie Brenner, senior vice president of the Fidelity Center for Applied Technology, Fidelity’s technology incubation group. After Linux, Fidelity adopted Apache and Perl, and then the Struts Web application framework and the Eclipse Foundation’s development environment. Fidelity is now looking at open-source database management systems and assessing what applications might make sense. The advantages of open source include widespread component reuse, better access to underlying code to customize interfaces across applications, and less complex systems to manage. "We’re heavy users of proprietary [software], and that won’t change, but there are times you need a motor scooter, not a truck," Brenner says.