ERP: It’s a Platform, Stupid! - InformationWeek

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ERP: It’s a Platform, Stupid!

ERP domination is now a battle of platforms.

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Ventana Research believes the emphasis in the war for domination in ERP systems is moving away from business functionality and toward a battle about platforms. The key players in this battle are Oracle, Microsoft and SAP. As the platform war escalates, Ventana Research believes IT will have an even more important role to play in ERP selections, implementations and assessing the value of these platforms for other IT requirements.

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In August 1996, I published an article in an industry newsletter proclaiming that SAP, as an ERP system, had reached platform status — that is, as an infrastructure layer that went beyond the functional domain of ERP itself. Now, almost ten years later, SAP and others are finally recognizing that the war for ERP domination has become a platform war.

Flush with the successful acquisition of PeopleSoft, Oracle is already pushing this new agenda based on the strength of its existing middleware, application server, and database platform. This is not surprising in that Oracle’s applications have always been an “all-or-nothing” platform sell. SAP has responded with a renewed focus on its own platform “toddler,” two-year old NetWeaver, and emphasis of its push towards a future business process-focused service oriented architecture (SOA). Not wishing to be left behind, Microsoft — who seemed to have abandoned its visionary “Green” platform for the Business Solutions division — has responded by highlighting the desktop Office suite as a development platform to “front-end” ERP systems.

IBM is playing in the space too, in a small way, with the announcement of an SAP-specific version of its DB2 database. But IBM’s WebSphere platform is not really a player in this game because IBM doesn’t own a leading ERP system to sit on top of it. However, this platform play is not about an assembly strategy that relies on partners to supply the bits. It’s about total control. This has some worrying implications for customers who are already running much of their operations on ERP systems. They may soon find themselves forced to adopt the ERP vendor’s own infrastructure platforms wholesale before they can run the functional, process automation components found in future generation ERP releases.

Assessment

ERP selections and implementations are difficult enough from a functional, business process automation, and change management perspective. But when ERP systems become inextricably linked with the ERP vendor’s infrastructure platform, the IT implications will be significant. Ventana Research recommends that current users of leading top-tier ERP applications monitor the platform battle closely to keep track of the steady march toward ERP applications becoming part of a platform, which may eventually force a deeper change in their overall IT infrastructure.

Stewart McKie is European Analyst Director at Ventana Research.

Ventana Research is the preeminent research and advisory services firm helping our clients maximize stakeholder value with Performance Management throughout their organizations. Putting research in a business and IT context we provide insight and education on the best practices, methodologies and technologies that enable our clients to leverage assets to understand, optimize, and align strategies and processes to meet their goals and objectives.

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