Enterprise Applications, typically represented by solution types such as Customer Relationship Management and Enterprise Resource Planning, can be described as being bundles of different functionality that are designed to interoperate in support of the organisation's activities. ERP is a good example, as it is intended to more effectively manage the flow of raw materials and stock that an organisation requires in order to operate cost-effectively, for example a manufacturer of shoes would need to keep track of the materials needed to make shoes and packaging, manage production costs, like payment of wages and paying for utilities and equipment maintenance, then need to keep track of deliveries to a point of sale, such as a store.

Managing all these different types of activity will obviously cover a lot of ground, ranging across the manufacturing side, the employee side, and various financial points, such as accounts payable, purchasing costs, wages, and so on. Creating software in-house could take a long time and may not work as well as needed, whilst buying different applications (probably from different vendors) to manage each need creates a serious risk that the applications will not work together, resulting in chaos.

Enterprise Application suites have always been sold on the basis that they are valuable because they provide a wide range of functionality that is designed to work across all the different modules in the suite, eliminating the risk that applications will clash and fail to work. However, our research suggests that many businesses deploy Enterprise Applications for the wrong reasons, and that a significant amount of the functionality provided is simply not used at all - meaning that it is very difficult for these solutions to provide real value after all.

Key Findings

• Out of 60 organisations surveyed none used more than 50% of the licensed Enterprise Application functionality.
• A significant proportion of unused code is customised, unnecessarily prolonging upgrade cycles. This also indicates that standardised functionality is a myth and many organisations are paying too much for Enterprise Applications.
• To exploit the value from Enterprise Applications the IT department must ensure that they are fully integrated with objectives, business processes, management, and infrastructure.
• Investment in Enterprise Applications must be directed by organisation objectives, not by a 'me-too' policy or solely cost saving considerations.
• Enterprises must deploy an architectural approach that includes linking business processes with Enterprise Applications.
• Effective management of Enterprise Applications and the quality of service provided can be important differentiators, leading to improved performance.
• Real competitive advantage can be achieved by making use of intelligence capability now found in Enterprise Applications and easily integrated third-party solutions.
• To meet regulatory pressures there is a need to provide greater visibility into Enterprise Applications, with improved analysis and readily available audit trails.
• Access to Enterprise Applications needs to be independent of software type, communication channel, client device, and physical location, enabling improved utilisation.

Report Structure

This Report is intended to provide readers with an informative guide to making the most out of Enterprise Applications. Butler Group recognises that not every factor will be relevant to all situations, and that some organisations will already be utilising some of the components that make up an effective solution. Therefore, the Report has been divided into segments relating to the different guiding principles of exploiting Enterprise Applications, to make it easy for readers to locate the Sections that are of interest.

Section 2 - Introduction

The important considerations pertinent to exploiting Enterprise Applications are appraised in this Section.

Section 3 - Assessing Enterprise Applications

This Section looks at how to get the maximum value out of Enterprise Applications. Flexible delivery and payment models are increasingly being demanded. Benchmarking can be used to identify problem areas and functionality. The difficulty of integrating different applications can also be a strong consideration that makes continual assessment of Enterprise Applications important.

Section 4 - Architecture Considerations

Section 4 considers where packaged applications fit with the latest architecture approaches, such as Enterprise Architecture, Service Oriented Architecture (SOA), utilising a common platform, and a Radio Frequency IDentification (RFID)-enabled infrastructure. The ultimate goal is to be able to take a more flexible approach to applications deployment by assembling different services as required. There is an opportunity for pricing and delivery models to change, based on the emergence of software as a service.

Section 5 - Enterprise Application Deployment

The way that Enterprise Applications and new functionality are deployed can have a bearing on how successful implementations are. This Section reviews the various components of a deployment, including the use of an initial survey to generate an understanding of the current processes that operate within an organisation. Training and education are also vital if an organisation is to maximise return from the investment in Enterprise Applications. Using various types of service provision, such as hosted or on-site, outsourcing, offshoring, and managed services, are areas where savings and efficiencies can be made.

Section 6 - Application Management

The vast majority of large-scale organisations face a plethora of diverse applications, platforms, and hardware. Supporting this infrastructure in order to provide the service levels that the users of Enterprise Applications expect and in fact demand to run the enterprise is complicated and time-consuming. The Section scrutinises the solutions available to allow increased availability of Enterprise Applications, decreasing both planned and unplanned downtime.

Section 7 - Extracting Intelligence

The ability to easily extract information from applications is often overlooked. This Section considers the integration of Enterprise Applications with Business Intelligence (BI) solutions and the incorporation of the required intelligence directly into Enterprise Applications. Readily available analysis can encourage the uptake of new functionality.

Section 8 - Multi-Channel Access To Enterprise Applications

An opportunity exists for organisations to extend the reach of Enterprise Applications by providing support for the Internet, convergence, particularly voice, and wireless devices. Enterprises should not be put off by the complexity of this multi-channel environment. This Section examines how future competitiveness of the organisation could be reliant on addressing this area. The role of voice as an application is likely to grow over coming years, as the technology starts to mature.

Section 9 - Market Trends

Within the Enterprise Applications market we now have a proliferation of packages covering all areas of an organisation, from the supply chain through to Customer Relationship Management (CRM). The Section looks at the trends impacting the Enterprise Application marketplace, including the growth in Business Process Outsourcing (BPO) and the availability of industry specific versions.

Section 10 - Vendor Profiles

Vendor and product profiles can be found within this Section of the Report. The product and solution overviews are provided as an indication of what is obtainable in the market and should not be used as a comprehensive review of all the available offerings.

Section 11 - Glossary