South African companies need no longer fear getting involved in expensive, long drawn out and inflexible enterprise applications only to discover the solutions are no longer relevant to new business practices.
A new generation, "building-block", component-based approach to business software development avoids the costly mistakes made by ERP solution vendors over the past decade.
"It`s an approach that has gained worldwide acceptance and one that`s more appropriate to emerging business models," says Mike Mackay, Manufacturing Portfolio Manager of Rubico, the South African developer that has pioneered the use of components-based enterprise solutions in South Africa.
Rubico is a six-year old South African-owned company that employs 150 professional developers and industry specialists based in Johannesburg. "Not only does component-based development deliver a more flexible solution, but the functionality provided goes to the core of the real issues in any particular business. Additionally, it also overcomes the Buy or Build dilemma that companies face when deciding on a solution.
"The Build option, which many South African companies still hanker, can give you a 100%, but expensive fit with your business needs, while a Buy-in solution means you have to compromise and invariably go through a lengthy business process re-engineering project," he adds.
Mackay commenting on a turn-of-the century Gartner Research report that looked at applications and IT architecture for the new millennium concurs with its finding that while less than five per cent of companies today build their own ERP systems, they still organise their IS systems around a build mentality.
"Management still yearns for that 100% business process fit, but, while traditional ERP solutions are robust and functional, they cannot meet this need even with extensive, prolonged and very expensive customisation," he adds.
Object-oriented, components-based technology is different because it offers companies a Buy and Build option rather than the either or of the past. The application architecture that is common to all enterprise solutions forms the `off-the-shelf` core, while unique needs are built up from a library of mix-and-match components.
According to Gartner enterprises wanting leading edge business practices such as e-business, value chain and customer relationship management, "must partner with application vendors that are constantly re-defining their approaches to manufacturing functionality to what it should be, not just adding what is missing from their applications."
The study also points out that the business dynamics of mergers and acquisitions during the next five years will make the need for rapid coupling and decoupling of acquired or divested operations a must. "Agility is going to be critical for SA companies in the years ahead. Not only will a company`s unique needs be changing rapidly as business models and processes change, but it will also have to accommodate the structural changes resulting from continuous ownership changes - a trend that is already manifesting itself," concludes Mackay.
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