Are Enterprise Apps On the Way Out?

By Allan Alter  |  Posted 10-17-2006

Are Enterprise Apps On the Way Out?

Business processes have plenty of room for improvement: IT executives say IT and finance, the most computerized of business functions, can be far more automated than they are now. And IT's potential for improving customer service is massive. But data integration is thwarting IT's ability to improve productivity, reduce costs and increase revenues. So, companies are not just adopting new technologies like SOA and Web services—they're beginning to move away from 1990's-era enterprise applications. We are on the verge of a sea change in application integration.

Technology isn't the only fly in the BPI ointment: Watch for the final finding from the survey on Wednesday, October 25, where we will explore the human factors—in particular, the problem of cross-functional cooperation—that hold back business process improvement.

For more data and analysis, see CIO Insight's Research Center blog at go.cioinsight.com/researchcentral

Next page: New integration technologies are starting to displace older enterprise applications.

Sea change in

application integration: New integration technologies are starting to displace older enterprise applications."> Finding 4. Sea change in application integration: New integration technologies are starting to displace older enterprise applications.
Data integration remains a big barrier to business process improvement, and that is helping to spur the adoption of SOA, Web services and other integration technologies. These technologies should also make it easier to integrate individual applications, and apparently they are: Companies that have adopted them are now beginning to jettison their older CRM, ERP and supply-chain management applications. The bottom line: The old debate between best-of-breed and integrated packages is being rekindled.

Next page: Much more can be done to automate business processes.

Much more can be

done to automate business processes."> Finding 5. Plenty of opportunities for BPI progress: Much more can be done to automate business processes.
Decades into the information revolution, business functions still have a long way to go before they are fully automated—especially processes involving sales, marketing and service delivery. But even processes that are highly automated may provide opportunities for further automation. Take customer service: After spending billions of dollars on CRM and business intelligence systems, 79 percent of respondents believe this function can be more automated. The financial services industry also has a long way to go: Although it is more automated than other industries, just 48 percent of financial services respondents say their service-delivery processes are extremely or clearly automated, and 34 percent say that's true for their sales processes. The IT function, too, hasn't exhausted its potential; it's the most automated function in the company, but it presents more opportunities for additional automation than any department besides customer service.

Overall, it seems companies have far from exhausted the possibilities for increasing productivity, cutting costs, and boosting revenues by using IT to improve processes. That's why IT budgets and IT staffing continue to grow in the short term, and probably in the long run too: No organization is in a better position to help companies improve productivity than the IT department.

Research Guide:

  • Finding 1: Improving business processes is the top priority for many IT executives, especially at small and midsize companies.
  • Finding 2: Although process improvement is a priority, the pace of change is moderate.
  • Finding 3: Business process software and services often fail to meet expectations.
  • Finding 4: New integration technologies are starting to displace older enterprise applications.
  • Finding 5: Much more can be done to automate business processes.

    Upcoming results from the BPI survey

  • October 25: Lack of Cross-Functional Cooperation Thwarts BPI Efforts; The Problem Children of Process Improvement

    Read our previous surveys on process improvement:

  • Top Trends 2006: The Pursuit of the Frictionless Business Platform
  • Necessity Is the Mother of Velocity
  • Focusing IT on Innovation Will Come Back Into Vogue
  • Mobile Devices Will Become Strategic Necessities
  • Mobility + Collaboration = Productivity
  • Process Management Revs Up
  • The Real-Time Enterprise 2003: Can You Keep Up With Business Change?
  • Business Process Management