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Past Symposium/ITxpo
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Friday, 15 November 2002 If a real-time enterprise is to be successful, then the role of large-scale software applications, such as customer relationship management (CRM), is pivotal to success. Yet, four analysts threw up a few red flags of warning on the last day of Gartner Symposium/ITxpo 2002, Sydney audience to proceed with caution. “Don’t misunderstand what we mean by the real-time enterprise,” said Dan Miklovic, an ERP specialist and one of the four panel members discussing the role of business applications on the future IT architecture. “It’s all about right time, not real time,” he said. “Some information you do not need at your fingertips, so don’t build applications to do things faster when it is not necessary. “If all you do is go faster, then that is not necessarily any benefit to the customer.” CRM colleague Scott Nelson observed wryly: “If you get this wrong, all you’ll do is become more efficient and faster at angering your clients because you still have not looked after their needs.” “Moving information faster around an organization is not hard,” he continued. “The trick is to ensure you have systems that allow staff to add value to data as it passes through a company, and turn it into something to help people work more effectively.” One of the greatest challenges of creating a real-time environment is the ability to integrate applications so they can exchange data effectively,” said Mark Gilbert, a specialist in content management. “Systems no longer sit in an organization by themselves.” The panel, led by Asia/Pacific ERP expert Kristian Steenstrup, spent significant time discussing the pros and cons of choosing either best-of-breed products, or large-scale suites. When Mr. Steenstrup asked the audience to vote on their preference, a solid 75 percent favored best of breed – a belief supported by the panel. “I like to say that suites are fattening,” joked Mr. Miklovic, raising a laugh from the audience. “With best of breed, you buy what you want, what you need, what is easy to use but you pay a penalty for integration.” However, he said business management loves the idea of suites because there is a much smaller risk associated with integration. “Best of breed is a really hard sell,” Mr. Miklovic continued, “There’s no right answer to this issue. In some legacy environments, you’ll never move to pure best of breed, it’s just too hard. And in some cases you’ll have to line up with a suites vendor.” Mr. Miklovic also addressed client complaints that Gartner favors suites. “Really, that’s not true. We say that we see suites as dominating the landscape in the next few years. But that does not mean we think that is the best outcome.” Mr. Steenstrup said buyers need to watch suite vendors carefully because they often produce applications that claim to have the utility of best-of-breed products but are a pale imitation with none of the “drill-down functionality.” “I call those ‘Franken-suites’,” Mr Gilbert said. “Usually they are some sort of creation by a vendor who has just done a buy-out to acquire new technology but not really thought out the integration issues.” The panel also expressed frustration at companies that take “man years” to decide which vendor they should choose for a project. Mr. Miklovic said: “There’s too much agonizing and not enough doing. Companies have huge selection criteria. They waste so much time with selection. I have been in this industry for 30 years and I can tell you that it doesn’t matter. “Look at the top two or three vendors and just pick one!” The propensity of organizations to agonize over their decision is expensive for vendors who have to spend time and resources perpetually responding to requests and tender changes. Mr. Steenstrup said vendors build this expense into the price of their products, and ultimately the behavior of the user community is a self-defeating exercise. Integration was a focus for fellow panelist Mr. Nelson, who observed that the key to creating an e-business structure within a real-time enterprise depends on the ability to plug together applications such as CRM, supply chain management, enterprise resources, knowledge management and business intelligence. “Unfortunately, I see too many companies that allow individual business units to buy applications to solve their own problems, Mr. Nelson said. “In a billion-dollar company, it is not unusual to see 12 customer relationship systems from different vendors. “Management is allowing business units to act as renegades, and this is making the task of integration impossible. It is one of the reasons CRM is still seen as being on the fringe of an enterprise. “An enterprise resource package (ERP) will have one way of identifying a customer, and 12 CRM systems will each have their own way of doing things. What that usually means is that when a client rings up, someone on the end of the phone asks them for their name and address. “I have been to companies that spend millions of dollars on front- and back-office integration, yet they still have a bunch of clerks sitting in a room doing order-entry. All this sounds so simple, but companies get it wrong all the time.” Mr. Nelson said the emergence of multi-channels through which customers can make contact, such as e-mail, the Web or interactive TV, make the task of integration increasingly complicated but even more necessary. Panel leader Mr. Steenstrup added that while an organization might build a sophisticated architecture to handle all these channels, if it does not encourage staff to change behavior, projects will fail. Mr. Nelson gave the example of a company that asked call-center staff to reduce their time on the phone. They responded to this challenge by telling callers to go to the Web site and work out their own problems, and then put the phone down. Mark Hollands Gartner Staff |
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