1. Fundamental shifts driving imminent change for Enterprise Software Applications
(i) The emergence of the Cloud Computing paradigm:
What is Cloud Computing?
As per the Wikipedia definition, “Cloud computing is internet-based computing in which large groups of remote servers are networked to allow sharing of data-processing tasks, centralized data storage, and online access to computer services or resources. Clouds can be classified as public, private or hybrid”.
Practically Cloud computing is simply the ongoing shift where organizations and enterprises that manage their IT Infrastructure and IT Applications within a Data center and Network maintained and managed by the organization, are moving to a model where the physical IT Infrastructure is owned, and maintained by the Cloud Service Provider (CSP), and the organization or enterprise rents or leases the required resources on both the Infrastructure side and the applications side, to manage their IT Automation needs.
The key benefits of the shift to the cloud
(ii) The emergence of ‘No-code’ metadata driven application platforms:
What is ‘No-code’ application development?
The key benefits of ‘No-code and Metadata’ driven Application Development:
2. The current state of Enterprise Applications:
(i) Total Cost of Ownership
Organizations and their IT Departments are struggling with the total cost of simply maintaining the existing suite of Enterprise Applications, as the cost of such maintenance increases every year, without significantly improving the applications or adding additional capabilities to these existing Enterprise Applications.
(ii) Change Management
Organizations have to continuously evolve as they react to market changes or competitor actions and strategies, which in turn require them to modify the behavior of their existing Enterprise Applications. But introducing changes to the existing Enterprise Applications are a very painful, time consuming and expensive process, which hold back most organizations from reacting in an agile manner to the evolution in the marketplace.
Since the existing paradigm of Enterprise Applications being built on custom coded platforms requires highly skilled programmers, it is also an ongoing challenge to maintain these applications with new programmers, when the experienced programmers who built or customized the applications leave the organization. This problem introduces an additional layer of complexity and risk when attempting to change or modify the existing business applications.
(iii) Challenges in ‘doing more with less’
So while IT Departments within organizations struggle to simply maintain the status quo with their existing Enterprise Applications, they are also challenged to react and modify the Enterprise Applications using the same resources and budget constraints that exist. This situation arises not by choice, but due to a need for every organization to evolve based on evolving market trends and competitor actions, and such evolution can only be implemented operationally by applying the required changes to the existing Enterprise Applications, to support the new requirements specified. This ongoing challenge to ‘Do more with less’ is another imperative that justifies the transition to a No-code, Metadata driven model for Enterprise Applications. All the benefits summarized above for the No-code, Metadata driven model of creating and maintaining Enterprise Applications are significantly better suited to the challenges faced by IT Departments today.
3. The Enterprise Applications Opportunity today
(i) Doing more with less
If an organization reviews the benefits of a slow but sure transition to the cloud computing paradigm, without needing to change anything else, significant capital and operational cost benefits can be leveraged through such a transition.
Adopting No-code, Metadata driven models for application development will significantly increase the efficiency and productivity of the existing resources available to an organization, to deliver significantly more functionality and innovative new applications, without needing to invest in advance of tasting any benefits, as they are forced to do today.
(ii) Adapting to change efficiently
All organizations have to be able to react to market trends and competitor actions efficiently and in a timely manner, to be able to survive and grow their business in this hypercompetitive marketplace in the world today.
Such agility can only be achieved through leveraging the ‘On-demand’ capacity model of the Cloud, along with the No-code, Metadata driven application development model. Even if an organization is willing to absorb the cost of incorporating changes to existing Enterprise Applications, they are still faced with extended and usually unacceptable time periods, for realizing the changes required in their Enterprise Applications built with the current custom coded model.
When departments and power users are presented with a ‘Self Service’ type option to introduce changes to their Enterprise Applications, this approach also enables delegating the authority and ability to introducing change, to the frontlines of an organization, thus making it more efficient and cost effective, versus the centralized model that exists today, which is painful with high risk, high cost and a lack of predictability. Very often, by the time IT introduces a change to an Enterprise Application as requested by the business, due to the delays and time constraints in implementing the changes, the business need for such a change itself would have evolved with additional changes required, or would have been made redundant due to the delays in incorporating the required changes.
(iii) Adopting the best aspects of Cloud computing
Cloud Computing really presents a tremendous opportunity to Enterprise IT Departments, to enable them in being more agile, efficient and cost effective in meeting the business requirements that they support.
While there is no need to plan a ‘big bang’ type migration to the cloud, it just makes sense for organizations to plan a transition to the cloud, as the opportunity presents more agility, lower cost, and ongoing efficiencies in meeting the evolving business requirements. E.g. If an application is designed to have a User load of a 1000 users, and is therefore sized to work on a smaller server to suit the required capacity, it would take weeks or months for the organization to increase the server capacity available to the application, if the Users scale to 10’s of thousands for reasons that nobody could predict, which is a common occurrence. In the cloud paradigm, IT could spin up additional server capacity in minutes. Also if the peak load of Users is only for specific periods of time, IT can spin up additional capacity only for those days when high workloads are expected, as in the cloud you pay for the capacity you use by the hour.
(iv) Planning for the future
While it is easy to review and understand the potential benefits of Enterprises leveraging the value of Cloud Computing and the available No-code, Metadata driven application development models, it is not practical to rip out huge existing Enterprise Applications and replace them with new versions built on the latest best practices of cloud computing and No-code, Metadata driven Application Development models.
There is a lot of time and effort that went into building and implementing existing Enterprise Applications, and though the tools available to create newer, better versions of such applications exist today with the cloud and no-code app dev models, the time and effort that would go into a re-build of such entrenched applications would introduce risk and significant migration costs, that could make this process challenging.
So the recommended approach would be to first classify existing Enterprise Applications into what is termed ‘Systems of Record’ and ‘Systems of Engagement’. Systems of Record are the entrenched Enterprise Applications like an SAP or an Oracle Financials or a Core Banking system, which over time incorporate the core operational and administrative needs of an organization. Systems of Engagement on the other hand are the systems developed to extend the access to Systems of Record, to new channels and new user communities for the purpose of efficiency and fostering innovation. Below are three good examples of Systems of Record and their complementary Systems of Engagement which are presented in the table below.
|Systems of Record||Systems of Engagement|
|Core Banking Systems used by Bank Employees across branches||Internet Banking Exposed to Banks Customers for online transactions|
|Financial Systems used by a closed group of internal employees||Procurement process automation and Order management systems exposed to clients, vendors and partners|
|HR & Payroll Systems used by HR, Finance and Accounting Users within a company||Expense Reimbursement and Absence Request systems exposed to all employees|
Once such a classification between Systems of Record and Systems of Engagement are made, the Systems of Engagement present the most immediate and viable opportunity to adopt the cloud computing and no-code application development paradigms. The key thing to note also are that 90% of the requirements to incorporate changes to Enterprise Applications are typically for the Systems of Engagement. So planning for the opportunities presented today to be applied to the Systems of Engagement within organizations, present the most practical and best return on investment for any organization wanting to start down this path.