And there are some compelling reasons to undertake such a project now. For starters, the Sarbanes-Oxley Act, the government’s post-Enron accounting legislation, requires that financial reports have a verifiable audit trail. (For more on Sarbanes-Oxley, see "Your Risks and Responsibilities" at www.cio.com/printlinks.) With a single instance, all of a company’s financial data will live in one application and will originate from one source, eliminating consolidation errors and greatly reducing the time it takes to close the books.

Having a single data source could also create new revenue opportunities and cut costs. Companies would be able to run reports that show cross-promotion opportunities, places where they could reuse equipment or leverage purchasing power. Also, AMR estimates that companies budget $4.3 million for a single-instance order management module versus $7.1 million for multiple instances.

But despite these benefits, rip-and-replace is a difficult pill for CIOs to swallow, many of whom are just shaking off the multiyear, multimillion-dollar hangover of their first ERP project. And they’re wondering if there isn’t another cure for their integration headaches: Web services, those plucky little XML-based applications that are currently being held up by multiple standards organizations often working at cross-purposes (see "The Battle for Web Services," www.cio.com/printlinks). Web services could allow CIOs who have invested in best-of-breed solutions to integrate their standalone systems without either shelling out millions for single instance or tying their company’s future to a single vendor.

Essentially, single instance and Web services are two ways to get to the same place, and CIOs will need to choose which path to lead their company down.

"There’s no right answer," says Shutzberg. "Every situation is different. You have to follow your specific business drivers until you find a compelling reason to do it one way or the other."

Haven’t We Heard All This Before?

Does McDermott’s pitch sound familiar? It should. After all, ERP vendors today are singing the same song that got them through the corporate door in the first place: one system for everything (see "Sometimes a Great Notion," below). But as almost everyone who tried to do an ERP project in the mid- and late ’90s learned firsthand, the melody was off-key.

There are a couple of reasons single instance was almost impossible to achieve. For starters, databases large enough to serve entire enterprises just didn’t exist?at least not at prices most could afford. On top of that, connecting to that single database from faraway locations was almost impossible. It was a simple matter of physics, says Cap Gemini Ernst & Young Chief Technologist for the Americas John Parkinson. There wasn’t enough bandwidth to get to the data. "The result was a bottleneck," he says, which forced geographically dispersed companies to install regional ERP systems.