Supply Chain Management

Gartner say "...Although in the last couple years the pendulum has swung back to favoring best-of-breed (BOB) SCM applications over ERP, supply chain leaders have identified a successful hybrid model that leverages the power of both". Gartner further says "...By 2013, over 60% of demand-driven value network Leaders will exploit a hybrid ERP-BOB application portfolio strategy"

What does this mean to enterprise applications market?

Till now everyone believed that there is a unique market space for all these acronyms like ERP, EAM, and PLM et al. Everyone believed that there are supposed to be clear-cut boundaries between these applications. Most of the time and energy was invested on determining the exact contour of that boundary. Further, it was generally believed that it is a utopian idea to think that there has to be a one-size-fit-all product in enterprise solutions market.

Writing on the wall is very clear- this situation is fast changing - the world is moving away from an ERP vs. EAM vs. PLM regime to ERP + EAM +PLM regime. Call it BOB regime.

Every enterprise applications have some strong points. Even within same applications product range itself, certain vendor's products are better than the rest in some aspects. Some of them map to a particular industry better than the rest. This BOB will be a seamless integration of those modules of different products to bring out the best of all applications.

However this change is not going to be very easy. The components of this BOB application are owned by different product vendors. And these products keep upgrading from one version to next almost every year. And to ensure market for the newer version, the earlier versions are promptly taken out of support as soon as the next version stabilizes. The challenge would be not only to ensure that product versions are regularly upgraded but also to make sure that the integration adaptors continue to work even after the upgrade. This is going to be a huge challenge under normal circumstances.

But not when we have cloud.

That takes me to the next set of predictions...

Gartner says: "By 2013, the market for cloud-based SCM technology will have grown by 100%".
IDC says: "Value chain captains will put a stake in the cloud to level-set technology capabilities, with focus on aligning with the "clock speed" of the supply chain"

Cloud is going to be the leveler between haves and have-nots of technology capability. It will make supply chain applications future-proof. The BOB applications would work seamlessly for the customer and the cloud vendors would take care of the risk associated with version management and technology obsolesces- of course for a small cost.

What is the conclusion?  Wither the enterprise applications boundaries; hail the advent of new generation BOB applications hosted in the cloud.