by Thomas Wailgum

What Netbook Fans and Frustrated ERP Customers Have in Common

Apr 28, 20095 mins
Enterprise Applications

High-tech software and hardware vendors continually tell us that they try really, really hard to keep up with our omnivorous desire for more computing horsepower and for newer application versions offering the freshest interfaces to seamlessly bring together terabytes of 21st-century business data.

It is this heavily romanticized notion of delivering constant “innovation” to the market that has driven the technology industry to never-before-seen levels of success—and riches.

Indeed, high-tech vendors’ marketing machines and sales forces have done a superb job convincing businesses that they need more, more, more. “Do you want to be innovative or not?”

As a result, many companies and their users now live in a world of computing excess. Of waste. Of confusion. Of frustration.

And that’s a big problem. In my view, the computing industry and enterprise software vendors, in particular, still try to force Hummers on everyone, when what many of us really need is a Mini Cooper—make it look as cool and have it run as economically as possible, but bigger doesn’t make sense across the board.

Don’t believe me? Among consumer PC shoppers, look at the head-scratching rise in popularity and sales of netbooks; ya know, those lightweight, low-powered small-screened computers that Apple (the king of ridiculous excess) has dismissed as “junky.” Sure, there are power users who need the horsepower of a souped-up laptop or desktop. But not everybody does.

The ascendance of the netbook proves that savvy shoppers know there’s much waste and overspending in buying a laptop today. That enterprises are even considering netbook deployments—and some are—is telling.

What about the virtualization market? It walked into the enterprise via the backdoor, inching its way up from the test and dev group to the CIO’s office and production servers, because IT people in the trenches knew that most of their companies had massively overbought server- and desktop-computing power. Now companies are able to tap into that excess using virtualization, more efficiently run their data centers and desktop environments, and save money.

Beyond the savings, though, heavily-virtualized IT shops find that the most valuable benefit is how fast they can move for the business, provisioning extra computing power on the fly instead of in weeks, and quickly delivering new services to business units.

In other words, less data-center server hardware truly works better for these IT groups and their businesses.

What’s ERP Got to Do with It?

Which is where we come to the excess in enterprise applications, namely ERP software. Peter Thomas, a former IT executive at global insurer Chubb and veteran of many enterprise application ventures, writes in a recent blog about the excesses in ERP systems, comparing them to the plethora of unwanted and unused features included in that old, bloated standby, Microsoft Word.

“Because Word has to appeal to a lot of different users, with different needs and specialisms, it is chock-full of every single feature that anyone could ever need,” Thomas writes. “However, no single person ever uses more than a fraction of these. I think of myself as a reasonably advanced Word user, but I would bet that I utilize no more than 10 percent of its capabilities.”

The same type of knock applies to ERP systems, Thomas points out. “Because they include so much functionality for different companies in different industries, it can sometimes be difficult to configure them to do something as simple as entering and paying an invoice,” he writes. “Difficult, that is, without an army of consultants.”

Today, many CIOs, business executives and users are finally saying “Enough!” to their ERP vendors.

Ray Wang, VP and principal research at Forrester Research, has pulled together an illuminating and troubling series on his blog that examines the enterprise customer and vendor relationship as it stands today. In brief: Vendors are paying more attention to shareholder interests than to their stakeholders’ (customers and partners) well-being and actual needs, Wang writes.

Wang recently posted Part 4, which, when combined with earlier parts, ties neatly into the subject of excess and glut in enterprise software right now.

Here’s just a paraphrased sampling of what CIOs, business apps professionals and other IT managers are telling Wang:

We’re being forced by enterprise vendors to spend more money with them on applications and upgrades that we don’t need, to keep a “low rate” for maintenance; vendors are selling us additional products that have no future roadmap for the vendor because of conflicting post-acquisition roadmaps; additional consulting gigs require more product purchases; vendors are making us re-pay for the same functionality we already have; and vendors are continually failing to deliver on promised product roadmaps.

Taken together, Wang’s series paints a scathing picture of ERP vendors brandishing a brazen and short-term view while taking advantage of locked-in, shell-shocked and frustrated customers who don’t need any excess at this point.

While those customers may be locked in right now, they may not be that way for much longer. Open-source and SaaS options and alternatives are coming—and are already in use by many IT groups that recognize the innate and disconcerting excess in traditional ERP client engagements. IT shops that have dumped the ERP giants are benefiting from ending these broken and one-sided “relationships” (if you can actually call it a relationship).

So vendors, you may have your customers over a barrel now. But it won’t be long until more and more customers just say no more.

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