How Do You Choose Business Software?

I’m currently attending SuiteWorld. This is the annual customer event for cloud-based ERP software maker NetSuite (which was acquired by Oracle late last year). During the opening keynote today, given by Executive Vice President of Oracle + NetSuite Jim McGeever, it was announced that a new piece of the NetSuite product pie would become available this June. The new HR module, SuitePeople, brings HR functions into the suite. But this had me thinking. Is a single software solution that brings everything to you in one neat package the way to go? Or should you buy best-of-breed apps for each function and integrate them?

I started my IT career working at a manufacturing company that built its business around the JD Edwards product family. It ran on an AS/400 with users accessing the software through green-screen terminals (or a terminal emulation application running on Windows 2000). When I arrived at that company, the business ran version 5 of the suite but it was heavily modified in order to meet the enterprise’s specific needs.

A project was just kicking off to upgrade from version 5 to version 7 and it was a massive undertaking. The challenge was taking a generic software package and getting it to fit what the business believed were best practice processes for them.

If we jump ahead a couple of decades, we are now in the cloud era where companies access software that they have limited control over. If you don’t like how a cloud applications does things there’s very little you can do outside any configuration items the developer has decided you can change.

The challenge for many businesses is deciding whether to invest in an integrated suite or buy separate solutions for each business function and then integrate them through available APIs and other means.

Both approaches have pros and cons.

In the demonstration of SuitePeople I say earlier today, a warehouse manger could easily access personnel data from within the warehousing module and see what staff was rostered on, check on leave applications and process them, and look at overtime reports in order to see if there was budget to bring another staff member in to assist with some unexpected work.

That level of integration is difficult to achieve unless the software is all tightly bound together.

On the other hand, there may be better tools for HR management that offer more functionality and flexibility.

Choose for today but plan for the future

I was chatting to a colleague today and he mentioned a large Australian retailer with close to $200M in annual revenues using a cloud-based accounting application and a separate warehousing application that integrated via some APIs.

That approach works well for them and has scaled as the business has grown. But I wonder if those applications will reach limits. Perhaps not in terms of raw transactional volumes but when it comes to pulling together different pieces of software that deal with the complexities of more staff, more products and services, and the different regulatory requirements as they expand into different global markets.

In my minds, that means having a plan that might start with smaller, best of breed apps that work together through APIs and other integrations. But the plan requires clean access to your own data in a form that makes it possible to move to a different platform as the needs of the business chnage.

Many businesses choose software purely on the basis of today’s cost and how it meets today’s needs. I think they often miss the importance of choosing services that offer the ability to export your data in a form that makes it easy to migrate to a new platform when the time comes from that transition.

Choosing the software your business depends on is a big deal – even if you’re just starting out and are a sole trader. As well as being easy to use, you need software that will adapt as your needs change. For me as a sole trader, all I wanted to do when I started out was produce invoices make filling my BAS in as simple as possible, and reconcile my bank statements easily.

But it wasn’t long before I needed to do payroll and manage foreign currency transactions. I chose software that had those capabilities even though I didn’t need them on day one.

I’m still torn on whether an integrated software suite is the best option or whether choosing best of breed applications that you integrate is the best way. But I think it’s important to consider both options before jumping in one way or the other.

Anthony Caruana attended SuiteWorld 2017 in Las Vegas as a guest of NetSuite.

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