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'Third platform' transforms business

Regina Pazvakavambwa
By Regina Pazvakavambwa, ITWeb portals journalist.
Johannesburg, 03 Dec 2014
Organisations should review their IT policy and educate themselves on the technologies available, says Sage ERP's Keith Fenner.
Organisations should review their IT policy and educate themselves on the technologies available, says Sage ERP's Keith Fenner.

Mobility, cloud, social and big data have fundamentally changed the way people and businesses relate to technology - and the convergence of these technologies is what IDC terms the third platform.

So says Keith Fenner, senior vice-president sales at Sage ERP X3 Australia, Asia, Middle East and Africa, who notes IT departments are moving away from heavy legacy systems and are re-directing their spend into the third platform, sometimes at the detriment of established enterprise resource planning (ERP) vendors.

The challenge arises when the legacy systems exhaust the majority of the IT budget every year before any re-investment into new technology is considered, says Fenner. Therefore, the IT departments need to re-skill and learn how to take advantage of the new opportunities these agile platforms offer, he adds.

IDC first identified the third platform in 2007 and predicted it would eventually become the new core of ICT market growth. In 2015, the third platform will account for a third of global ICT spending and 100% of spending growth, says Frank Gens, senior vice-president and chief analyst at IDC.

According to the IDC research, worldwide ICT spending will grow 3.8% in 2015 to more than $3.8 trillion. Nearly all of this spending growth will be focused on third-platform technologies, with spending on the second platform (personal computers) expected to slip into recession by the end of the year.

The research revealed, on a geographic basis, ICT spend in emerging markets is forecast to grow 7.1% year on year, while mature markets move along at 1.4% growth.

This will give rise to new business models that align with business outcomes, and this requires agility, says Fenner. Agility can only be defined by the choices the business makes regarding its ERP vendor and their adoption of the third platform, notes Fenner.

Organisations should start to look carefully at their product architecture as well as roadmaps and technology strategy, he adds. "This fundamental shift has driven the change in software licensing from perpetual models to subscription or usage-based contracts, and will continue to force legacy vendors to address the way they do business."

The ability of vendors to provide freedom of choice in pricing and delivery across line of business solutions as well as an open architecture for operating and integrating, is vital, says Fenner.

"As a business, you need to literally 'plug in' line of business applications such as talent management, recruitment, stock optimisation, mobile sales and procurement, from the cloud. These mini-projects should be deployed quickly, integrated easily and deliver a return of investment immediately."

Fenner points out it is critically important for businesses to review IT policies and educate themselves on the technologies available, and their impact. "As we embark on the true information age, more trends and technologies may be added as they gain traction and importance in the market."

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