Full Suite vs. Best-in-Class?

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1 A DSG WHITE PAPER Full Suite vs. Best-in-Class? DSG s Guide to an Age-old Debate Copyright All Rights Reserved. Demand Solutions Group.

2 Introduction For as long as there has been Customer Relationship Management (CRM) and Enterprise Resource Planning (ERP) software, there has been a passionate debate on the pros and cons of whether it is better to purchase CRM and ERP from a single vendor or buy the best available CRM and ERP and then make them work together. The move to the Cloud has done very little to change the fundamental nature of this debate. However, as major players such as Oracle, Microsoft and SAP enter the Cloud applications market and bring with them their vision of a unified Cloud application stack based on their products and technology, the Integrated vs. Best-in-Class debate is heating up again. This DSG white paper takes a pragmatic look at the Full Suite vs. Best-in-Class debate. As one of the leading and most experienced Cloud business solution providers in the US, we bring the experience of hundreds of successful Cloud solution projects both Full Suite and Best-in- Class to the table and will use this white paper to share our insights. The Full Suite vs. Best-in-Class Debate What s The Issue? Like most industries, the software industry has seen significant consolidation over the last decade. Driven by the tough business environment that followed the post-y2k bubble and the dot-com crash, companies such as Oracle, Microsoft and Infor have acquired competitors and partners alike in a race to build market share. Other companies, such as SAP, have followed a more conservative approach, acquiring technology companies and then using their new capabilities to build new functionality (e.g. dashboards) into their existing application suites. As a result, the applications market and particularly the ERP market is dominated by a handful of vendors whose combined marketing and channel muscle has really advanced the argument in favor of the Full Suite camp. What s more the Cloud application boom of the last few years has not altered this picture because it has produced few new ERP solutions the most notable of which is NetSuite which successfully built an ERP solution capable of challenging the likes of Microsoft and the SAP mid-market products in terms of breadth of functionality and vendor viability. However, while the ERP world may not, as yet, have been unduly shaken by the Cloud, the CRM world has been stood on its head with the emergence of Salesforce.com. Driven by the cost-effectiveness of its multi-tenant architecture; by its functionality and by the vision of its leadership, Salesforce.com has become both the dominant Cloud and CRM player. This dominance has, almost single handedly, re-opened the Full Suite vs. Best-in-Class debate. When most companies talk about pursuing a Best-in-Class strategy what they often mean is that their sales group is insisting on using Salesforce.com and that the rest of the company had better find something that works with it! This gave rise to the Cloud-based integration market led, noisily, by vendors such as Cast Iron (now part of IBM) and Boomi (now owned 2

3 by Dell) whose Cloud-based integration is easy messaging further fuelled the Full Suite vs. Best-in-Class debate. With that as a backdrop, let us look at the business and technical reasons that companies should take into account when evaluating how the Full Suite vs. Best-in-Class debate impacts their business. The Full Suite Perspective The Full Suite vendors believe that the key imperative for any company is to have a 360o degree view of its business operations and to make fast decisions based on a complete understanding of all of the available information. Full Suite vendors argue that this is only truly possible if all of a company s information is stored in a single application and can be viewed through the lens of a single reporting tool or dashboard. This is a highly attractive argument especially to executive management who, not surprisingly, are the primary target of the Full Suite vendors marketing and sales pitches. However, the 360o view is not the only benefit to consider in this approach. The fact that Full Suite applications typically hold all their information in a single database, allows real-time and tight integration between the various functional modules that make up the Full Suite. This enables rigorous business processes to be set up that would, for example, prevent new orders from being accepted for a customer that has gone over their credit limit. This tight integration also has another significant benefit traceability. Because all of a company s information is in a single database and because the relationships between the different types of information held in this database are well-defined it is possible, for example, to retrace what was originally sold to a customer back through to the manufacturing process to identify what was produced and why the sub-assembly contract manufacturer or component supplier may have produced the wrong product specification. The Best-in-Class Perspective Best-in-Class vendors argue that the best way to run a business is for every unit to have access to the best possible functionality that enables them to streamline and optimize their own operations and then to use integration or a reporting-based approach to provide a consolidated view of key company information to drive decision-making. They further argue that, with low-cost integration and reporting tools being widely available, it is easy to build a 360o degree view of the business on top of a Best-in-Class application architecture. The Best-in-Class argument appeals most strongly to companies that have very specific functional needs that can t easily be met using the pre-built functionality or customization capability of the Full Suite solutions. This argument is easily understood at the functionality level but it has another, more subtle aspect to it. 3

4 This aspect is at the user interface level. With a Full Suite application, one of the key design tenets is that everyone accesses the same information through the same user interface. With a Best-in-Class application, the user interface is optimized around the type of user and how they want to use the system. Best-in-Class vendors believe that, although they may need to access the same information, the way that a sales user, for example, wants to look at a customer, is totally different from the way that an AP clerk wants to look at a customer. Furthermore, the Best-in-Class vendors argue that their functionality is deeper with broader appeal to more markets while the Full Suite solution covers more functional areas with not as much depth. The reality is sometimes yes, sometimes no. In the Cloud this is more driven by the maturity of the solution being offered and the investment the vendor is making in specific functional areas. As the products age the Best-in-Class vendor will have continued to focus their energy in one specific functional area and the Full Suite vendor will have continued to invest in many functional areas. If however the Best-in-Class vendor doesn t stay at home or if the Full Suite vendors continues to make large investments in all areas, the differences can be very minimal. The Customer Perspective When DSG host webinars or dinners on the theme of Full Suite vs. Best-in-Class, the customer perspective is almost always in favor of Full Suite especially in organizations with an experienced CFO. In most cases, the consensus is that the benefits of having a fully integrated business solution outweigh the Best-in-Class approach even if this means compromising some functionality. Indeed many people who have been through the process of integrating and maintaining a Best-in-Class business applications environment have told us that, with 20:20 hindsight, providing the Full Suite solution provided at least an 80% fit against their business needs, they would opt for such a solution rather than spending the time and money to pursue a Best-in-Class strategy. So How Does This Impact Your Business? DSG believes that there are four key issues you must take into account when assessing the impact of Full Suite vs. Best in Class on your business. These are: 360 o View the ability to react quickly to changing business conditions and to make decisions based on up-to-date, accurate and complete information is critical. While the Full Suite vendors have an implicit advantage in arguing for the completeness of their 360o degree view of business operations, a solid argument can still be made that using the right integration or reporting approach can deliver similar benefits to a Best-in-Class solution particularly where that approach is executed by an experienced solution provider with deep knowledge of such tools, business processes and best-practices. The User Perspective as your company evaluates Cloud solution options, it s important to evaluate not just basic functionality but also ease-of-use from the user perspective. Where 4

5 rapid or large scale roll-outs to distributed sales and support operations are required, this issue may be critical to driving rapid adoption and to the ultimate success and ROI of their Cloud solution. Complexity, Cost and Risk of Integration there is no doubt that adding an integration component to any project adds to its complexity, cost and risk. Although the direct cost impact may be modest, it introduces more variables and decisions into the implementation equation, for example: o What integration approach should be followed (custom or tool-based )? o Who should be responsible for integration? (internal IT, a solution provider or the integration vendor)? o Where should these integration processes be hosted? This last point is an important one, since the Cloud application vendors will almost certainly not host or support the integration routines. Time-to-Value DSG believes passionately in the concept of the Cloud Accelerated Business. What s more, we know that for many of our customers, getting live and seeing real value from their Cloud solutions investment as quickly as possible is a key factor in deciding to move to the Cloud. We believe that as you evaluate the Full Suite vs. Best-in- Class issue, the time-to-value factor should be at the forefront of your evaluation process. This is not to say that you should rush to get live at the expense of critical functionality, business agility or future plans but it is to say weighing the impact of how long it will take to evaluate, implement and support a single vendor Full Suite solution vs. a multi-vendor Best-in-Class solution must be taken into account. What s Right for You? Over the course of hundreds of Cloud business solution projects, DSG has been involved in this discussion many times and we have seen how decisions on Full Suite vs. Best-in-Class have played out for more than 200 companies. We not only have opinions on this issue, we have deep experience of how this decision can impact businesses both positively and negatively. In terms of what is right for your business, the answer, almost inevitably, is it depends. There are some companies for whom a Full Suite solution is absolutely the right approach but there are others where, because of specific functional needs, strong executive preferences or legacy applications that need to be supported, a Best-in-Class plus integration approach is necessary. As part of our services, we have developed DSG Solutions Discovery, a two week detailed evaluation of your business operations, goals and challenges, out of which we believe we will 5

6 be able to make objective assessment of the pros and cons of each approach in your unique situation and help you come to the best possible decision on what s right to help Cloud Accelerate your business. About DSG DSG delivers Cloud based business solutions based on leading ERP and CRM applications such as NetSuite and Salesforce. With our deep business and technology expertise and the experience gained in hundreds of successful projects, DSG is acknowledged as one of the leading Cloud business solutions providers by our major business partner, NetSuite, and by Cloud media and analysts such as IDC and CRN. Since 2005, hundreds of companies from startups to the Fortune 1000 have worked with DSG and our proven Realize, Optimize and Revitalize methodologies to implement tailored NetSuite and Salesforce solutions that, from day one, deliver value, insight and business acceleration. For more information, visit 6

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