How to Create a “Best-of-Breed” ERP Solution within the Cloud Community

March 7, 2013
By guest blogger - Pat Garrehy

It has never been easy to piece together best-of-breed solutions in the On-Premise environment. When one considers all the variables that are present, (versions of the operating system, the relational data base system, the browsers, the compilers, etc.), it is no wonder that the best-of-breed approach never flourished in the On-Premise world. With this in mind, why should anyone assume that it is easier to integrate different applications and create best-of-breed solutions just because the system now leverages the Cloud?

There is one major reason. Public cloud vendors are, in fact, delivering complete “platforms” that eliminate many of the aforementioned variables that led to an excess of combinations and permutations in the On-Premise world. It was nearly impossible to make a variety of specialized apps peacefully co-exist and function as a cohesive solution.

Contrary to the On-Premise legacy, public cloud platforms have already considered development, integration, development languages, open API’s and web services to assist those who want to develop apps on their platforms. Not only have these platforms been effective at reducing the cost of development and integration but they have also ensured that a native app will, indeed, peacefully co-exist, be deployed and be maintained independently without impacting other apps on the platform.

Companies considering using apps on one of the public cloud platforms must understand that the public cloud platforms do have some differences. To understand them is determined by how one defines the term best-of-breed.

For instance, NetSuite’s development environment has evolved over the past few years to enable end users and VAR’s to extend and make minor customizations to NetSuite’s business and financial applications (originally known as Net Ledger). Their development environment is most conducive to creating small extensions to the present NetSuite ERP system. Those adding software to the NetSuite solution are typically end users and system integrators who, themselves, can effectively provide minor customizations and extensions to their NetSuite ERP package. A number of systems integrators have built extensions to the NetSuite ERP. Most of them are value-added resellers and implementers of NetSuite, not software companies who promote and sell their own product independently of the NetSuite solution.

Salesforce has a different model. It has created a community in which more applications can be developed to work with their CRM software. However, Salesforce has taken this concept to the next level. The Salesforce development environment (Force.com) is so robust that a third party software vendor can indeed develop a very functional “industrial strength” business application that can scale. Since Salesforce wants to attract a variety of software vendors to join its community, it not only provides extensions but, equally important, Salesforce attracts business application software developers that want to develop larger comprehensive packages which can be purchased on their own. As a result, a number of software vendors have developed entire suites of applications that reside in the community, going beyond a simple point solution.

Because the intent of the Force.com platform was to build development tools and capabilities that would attract independent software vendors versus those that simply want to add spokes to an existing Cloud ERP solution, Salesforce ensures that there is adherence to standards for integration with their CRM software. Thinking ahead, they also want to ensure that these same standards apply to other software developed on their platform so that each software application can seamlessly integrate with other applications.

Therefore, the Salesforce environment assumes that, within one deployment, there could be differing customizations and extensions done by a variety of parties. As a result, a Force.com deployment allows different third parties to create their own customizations and extensions to both the Salesforce CRM and to those third party business applications. This means that customizations and extensions done in an organization deploying a very broad business application, such as a Cloud ERP solution on the Salesforce platform, will not collide with other extensions provided by additional third parties that will connect to the Cloud ERP suite and to the Salesforce CRM application in the future. In other words, Salesforce has now created the technical environment required for best-of-breed business applications to effectively work together. Additionally, by providing common UI’s and integration software, this ensures that users don’t have to learn a plethora of UI’s and protocols.

New Paradigm Leverages the Public Cloud

Public cloud patrons will likely follow the lead of Salesforce. In order to be competitive in the years to come, it will be a requirement of all Cloud platforms to consider how different types of software applications may be hooked together to provide a better user experience. This is something not very practical on On-Premise and Hosted software. It’s not even realistic for software on Private Clouds since there is little or no proviso for the various software vendors to place their apps. This has resulted in a new paradigm, the Best-of-Breed Ecosystem.

Being a part of this Best-of-Breed Ecosystem is now accepted as providing a significant strategic advantage by the various cloud application vendors, including the Cloud ERP suppliers, which reside on the public cloud. Software vendors, knowing that they can broaden their application by working with other software applications, now appreciate that they must plan for this from the get-go.

To achieve this objective, software architects on the Force.com platform deploy a combination of API’s and “hardening of objects” – putting the logic, including validation and edits in triggers – so that various other business software applications can call these API’s (hardened objects) directly from their own code. This technique, when combined with the capability to quickly generate screens or pages by the customizer, provides a significant improvement in customization not possible with On-Premise, Hosted or even Cloud ERP solutions that are in their own private, proprietary clouds.

Not only does each business application software provider prepare their software for eventual integrations with a number of best-of-breed applications but it also causes them to rethink their business model and ask the following questions:

  • What should we develop as part of our core application?
  • In what community can we be assured that we will find other business applications that can be effectively integrated with our own software application to provide the end user with a best-of-breed experience?
  • What Public Cloud(s) will IT departments adopt as reliable standards for the Best-of-Breed Ecosystem in the years to come?

Author Bio
Pat Garrehy is the Founder, President, and CEO for Rootstock Software® and has an extensive background as a software architect and engineer. As a University of California at Berkeley graduate, he holds a BS degree in business and mathematics as well as a MBA in finance from the University of Southern California.

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3 Responses to “ How to Create a “Best-of-Breed” ERP Solution within the Cloud Community ”

  1. David Faye on March 16, 2013 at 2:49 pm

    Nice column and an incredibly valuable concept, although it needs to be stated that Salesforce.com isn’t the only game in town when it comes to the “best of breed” in the cloud concept. Other software like SugarCRM and Intacct do a great job as well. Disclaimer — we represent both Sugar and Intacct and have built integration between the two, so we’re not exactly objective in this. However, despite the relative pros and cons of any particular solution, we should all acknowledge that best of breed is a concept beyond any one particular software package or platform.

  2. oscil8 on March 22, 2013 at 4:42 am

    What I take from this article:

    There is a particular type of business power user who creates “ERP components” in Excel/Access/etc, sowing silo-ification and complexity because it’s hard to fit their creations into the paradigms of the major systems they interact with.

    With Force.com, the same business power user could throw together a configured Force.com app instead, but won’t create the same mess because the platform has constrained them to “do the right thing” by guiding and templating them through the creation process – thus the Best of Breed Ecosystem retains its integrity.

    David Faye: are you making the same claim for SugarCRM and Intacct?

  3. Brett Beaubouef on April 12, 2013 at 1:48 am

    Thanks for the article and insight. My humble opinion, the argument of integrated vs best of breed ERP has been debated over the last 10 years. From a technical prespective, Cloud does not provide an evolution in simplifying integration. We have all heard the proverb “A chain is only as strong as its weakest link.” Applying this concept to business software, we would conclude that a business solution is only as strong as its weakest integration. Usually overlooked and underestimated, integration is one of the most important factors to consider as part of a best of breed vs. integrated ERP solution. The benefit of richer functionality is limited by partial integration and increased total cost of ownership.

    http://gbeaubouef.wordpress.com/2011/04/30/best-of-breed-vs-integrated-erp/

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