It’s an age-old debate: As an organization, do you use the same vendor for every enterprise application where possible, or choose the best software for that business process?
While the debate continues, the argument has evolved. Back in the days of the mainframe, you were locked in with one
vendor, but with the advent of the PC, applications started to open up.
“”It tended to be best-of-breed,”” says Warren Shiau, software analyst with IDC Canada in Toronto, “”because at this point no one had really tied everything together.””
Shiau says Microsoft’s efforts on the desktop to create a suite of applications that worked together were the precursor to a similar movement among enterprise application vendors. “”It’s the lessons learned from Microsoft and the desktop market that have brought the industry forward.””
Vendors such as SAP, Oracle and PeopleSoft, for example, all started out with core competencies and made their name in the industry by being the best-of-breed for certain functionalities — whether it was PeopleSoft for HR or SAP for reporting. Now all of them have broadened their offerings, says Shiau.
But while it’s conceivable today that one vendor can offer the functionality an enterprise requires — financials, HR and CRM, for example — integration of third-party applications has become easier, and in some cases, there are functionalities where large vendors have yet to gain the depth and experience needed.
“”Even though the best-of-breed application may still have better functionality,”” says Shiau, “”it can become a situation where the user is faced with a pressing economic argument in favour of going with an integrated solution.””
It comes down to the functionality the organization is trying to pursue, says David Stevens, partner in charge of IBM Canada’s supply chain operational solutions practice.
“”There are clients who are large and sophisticated who can decipher between the nuances and subtleties of a best-of-breed solution and the extension to a traditional ERP system.””
He says best-of-breed vendors have traditionally pushed functionality while ERP vendors have argued the integration story.
“”Now you’re seeing ERP vendors saying, ‘If you want to talk functionality, we can go pretty deep as well.'””
For some, limiting the number of vendors comes down to relationship management. Dwight Wilson, CIO for production and systems support at NB Power, says he has only so much time to manage multiple vendors. Through its relationship with systems integrator Xwave, the utility deals with a core group of technology providers (see sidebar), including SAP for most of its core operations.
“”I want to deal with a few key partners long term,”” says Wilson. “”It’s not designed to lock other people out. If Xwave chooses to work with a number of partners we haven’t traditionally worked with, that’s fine, as long as the value proposition is there.””
Peter Valters, director of outsourcing at Xwave, says the