Consolidation Pushes Innovation in ERP

CEOs are demanding data that gives them an end-to-end view of the enterprise — that is, data integrated from multiple, fragmented sources.

--Booz Allen Hamilton

Booze Allen Hamilton authors Mitch Rosenbleeth, Corrie DeCamp, and Stephen Chen report on the effects of ERP market consolidation in their recent article, "The Coming Software Shakeup." With only two major players left standing -- Oracle and SAP -- a major impact of consolidation will be higher prices, the authors say. Higher prices in turn will lead to more companies getting their ERP by subscription over the web as a pay-per-use service. More and more, buyers will also look beyond increasingly standardized ERP systems for competitive advantage -- which more often will come in the form of what used to be called decision support.

My own feeling is that consolidation will push innovation. Web-based ERP is a more efficient vehicle with which to deploy innovative features, including the data-centric end-to-end visibility into the business that the authors discuss. As innovation becomes critical, software buyers will find they simply can't wait while putting up with the internal cultural resistance and long deployment cycles of traditional software implementations.

I do have one question for the authors: What role will business intelligence vendors play in all this? Companies like Hyperion, Cognos, GEAC, and OutlookSoft already claim to provide end-to-end visibility. Look at what OutlookSoft says on its website:

OutlookSoft CPM's web-based architecture allows for zero-footprint, ultra-fast deployment, scalable to the thousands. Integration with your general ledger (GL), ERP, and other source systems is seamless -- including SAP, Oracle, PeopleSoft, and more. And OutlookSoft CPM's patented integration with Microsoft Excel ensures the broadest possible level of corporate adoption, acceptance and usability

Are these companies an example of what Booze Allen Hamilton is talking about when it says that:

… as smaller software companies are swallowed up by larger ones, and as top-tier applications migrate into content-rich information systems, the most innovative survivors will develop new industry-specific niche programs that analyze and transform data in real time so that it can be acted upon.

Does this mean that the future of business intelligence is ERP? Yes? No?