The Application Software Suite is Yesterday's News
SaaS and other Internet-based software solutions are negating the original value of application suites by delivering superior value to companies today.
By Michael A. Braun, Intacct
Mar. 24, 2008
I've been in the technology business for 36 years. I've got all the pluses and minuses of that experience, both scars and medals. When it comes to software - especially business application software - there has always been a large market for both best-of-breed (BoB) application solutions and multi-product "suites" - a group of applications from one vendor that is pre-integrated to work together. The wars between these vendors are legendary.
But the Internet has changed the balance of power in this long-standing battle. Today's Internet-based computing platform and Software as a Service (SaaS) delivery model enable customers to choose the superior function of BoB solutions with confidence. Indeed, the suite is "so yesterday." It was born during the client/server computing era to solve a set of technology integration problems that the Internet and SaaS have rendered obsolete. And in the eyes of many customers, the suites did a mediocre job solving those problems anyway. Many view the suite as something that turned out being better for the vendors than the customers. Indeed, client/server computing and on-premise enterprise software will live on for decades; but they are yesterday's news. The all-in-one software suite is part of that bygone era.
The History of Best-of-Breed vs. Suite Products
Let's start by looking at the world before SaaS. The dominant computing platform for business applications evolved through four major generations from mainframe to minicomputer to the desktop; and in the 1990s, client/server became the dominant computing platform by blending the best of the prior generations. These first four generations had two things in common. First, application software was delivered to customers using the on-premise model. They bought application software, infrastructure software like databases, and hardware; they installed it and were responsible for all facets of operations - integration, backup, availability, security - everything. Second, each platform era had different leaders in the applications business and each era supported a market for both BoB products and suites.
Before the SaaS/Internet era, the typical computing era began with dominance by new BoB players. Why? The incumbents found it nearly impossible to divert resources from their large successful business to build something truly new that would deliver innovation made possible by the new computing platform. So, the innovators were small startup companies with limited resources to create complex applications for major companies. They had to keep focused on a single BoB application to be successful. As each era evolved, suites emerged. Some companies added applications to their core organically, and others created suites through vendor consolidation.
The suite rose to prominence in the 1990s. It arrived on the scene to solve a customer problem created by technology proliferation. Old world computing models were complex and none more so than three tier client/server. The technology was characterized by many different platforms, server operating systems, databases, application servers, client operating systems and limited interoperability standards.
The customer was totally responsible for implementing and integrating both business applications and the dizzying array of complex infrastructure technology components which all had independent upgrade schedules and dependencies.
If a customer had an Enterprise Resource Planning (ERP) system that ran on AIX, Websphere and DB2, and then acquired a company that used a Supply Chain application running on Solaris, BEA, and Oracle , it's easy to see the challenges. The technology proliferation and the need for the customers to perform their own integration between all these systems created a nightmare for them.
In addition, enterprises were also responsible for all IT operations. Each company had to have specialists - database administrators for different databases, for example - security systems, systems management, backup procedures, and so on. The customer was also responsible for system upgrades, not just for application software but for the underlying infrastructure as well.
The computing model drove the delivery model: on-premise software. But the delivery model created this incredible technology integration problem with wide-ranging effects. It dramatically slowed the adoption of software and became a huge sales obstacle. Vendors couldn't sell new products because the customer was using all its resources integrating and maintaining current systems. Many customers turned to system integrators or other vendors to outsource the integration work or even the whole IT function!
-
But the Internet has changed the balance of power in this long-standing battle. Today's Internet-based computing platform and Software as a Service (SaaS) delivery model enable customers to choose the superior function of BoB solutions with confidence. Indeed, the suite is "so yesterday." It was born during the client/server computing era to solve a set of technology integration problems that the Internet and SaaS have rendered obsolete. And in the eyes of many customers, the suites did a mediocre job solving those problems anyway. Many view the suite as something that turned out being better for the vendors than the customers. Indeed, client/server computing and on-premise enterprise software will live on for decades; but they are yesterday's news. The all-in-one software suite is part of that bygone era.
The History of Best-of-Breed vs. Suite Products
Let's start by looking at the world before SaaS. The dominant computing platform for business applications evolved through four major generations from mainframe to minicomputer to the desktop; and in the 1990s, client/server became the dominant computing platform by blending the best of the prior generations. These first four generations had two things in common. First, application software was delivered to customers using the on-premise model. They bought application software, infrastructure software like databases, and hardware; they installed it and were responsible for all facets of operations - integration, backup, availability, security - everything. Second, each platform era had different leaders in the applications business and each era supported a market for both BoB products and suites.
Before the SaaS/Internet era, the typical computing era began with dominance by new BoB players. Why? The incumbents found it nearly impossible to divert resources from their large successful business to build something truly new that would deliver innovation made possible by the new computing platform. So, the innovators were small startup companies with limited resources to create complex applications for major companies. They had to keep focused on a single BoB application to be successful. As each era evolved, suites emerged. Some companies added applications to their core organically, and others created suites through vendor consolidation.
The suite rose to prominence in the 1990s. It arrived on the scene to solve a customer problem created by technology proliferation. Old world computing models were complex and none more so than three tier client/server. The technology was characterized by many different platforms, server operating systems, databases, application servers, client operating systems and limited interoperability standards.
The customer was totally responsible for implementing and integrating both business applications and the dizzying array of complex infrastructure technology components which all had independent upgrade schedules and dependencies.
If a customer had an Enterprise Resource Planning (ERP) system that ran on AIX, Websphere and DB2, and then acquired a company that used a Supply Chain application running on Solaris, BEA, and Oracle , it's easy to see the challenges. The technology proliferation and the need for the customers to perform their own integration between all these systems created a nightmare for them.
In addition, enterprises were also responsible for all IT operations. Each company had to have specialists - database administrators for different databases, for example - security systems, systems management, backup procedures, and so on. The customer was also responsible for system upgrades, not just for application software but for the underlying infrastructure as well.
The computing model drove the delivery model: on-premise software. But the delivery model created this incredible technology integration problem with wide-ranging effects. It dramatically slowed the adoption of software and became a huge sales obstacle. Vendors couldn't sell new products because the customer was using all its resources integrating and maintaining current systems. Many customers turned to system integrators or other vendors to outsource the integration work or even the whole IT function!
-
