That means organisations need to remove as many non-core activities from the agenda as possible. Many businesses already look to packaged applications to automate essential, but commodity business processes, such as back office functions like accounting, procurement and inventory management. Such firms are increasingly being joined by others which may have previously developed and coded their own systems from scratch, but which have become aware that it’s no longer advisable or acceptable for them as bankers, retailers or whatever to be in the software development industry!

Why would any retailer be writing their own point of sales software when there are off-the-shelf alternative already made that will do the job perfectly well and allow you to get on with devising new retail propositions that will pull in more business? Unless there are highly individual or niche functional requirements for a particular system or application, it makes little economic sense for organisations to divert hard-pressed time and resources to ‘growing your own’.

There are other considerations to take into account. In the past organisations have struggled under the burden and the cost of integration, having to take their own in-house developed systems and join them together so that they work seamlessly. Or they have faced the challenge of taking packages from multiple vendors and making them work in harmony. This has taken up a lot of time, money and effort on the part of the IT department, all of which could have been more productively spent on exploring, deploying and optimising technologies that would better support or enhance the business.

Today there are opportunities to remove much of this effort. Major vendors such as SAP and Oracle have so expanded and diversified their portfolios that they can now be regarded as platform providers. They can they provide ‘soup to nuts’ applications that cover a wide range of functions, from accounting to customer relationship management (CRM) to enterprise resource planning (ERP) and which work seamlessly together because they come from a single vendor.

More than this, such is the breadth and influence of such platform providers, they have spawned an ecosystem of third party applications firms which develop their own products to run seamlessly with those of the platform vendors. Such firms ‘plug the gaps’ in the larger vendors’ portfolios, addressing the functional areas or the niche markets that their platform offerings do not yet cover.

Adopting the products from such platform vendors also eases the burden of compliance and security on end user organisation as their offerings are developed to meet all the major regulatory requirements and governance demands. They are developed in accordance with both legislative demands - preventing your CEO from going to jail! - and to technological standards - which make it easier to do business with third parties.

Standardisation makes it easier to put systems in place, safe in the knowledge that third party companies with which your organisation deals and trades will be able to integrate with your own. This is invaluable in the connected world of the digital economy. Having a supply chain system in place that is the same as the one used by your major suppliers eases the flow of information and money between the various parties in the wider ecosystem.

Another beneficial aspect of standardisation is that it has enabled vendors to produce specialist versions of their standard applications that are tailored to the specific needs of particular vertical markets, such as an ERP package aimed at manufacturing customers or a version that meets the requirements of a highly regulated industry, such as pharmaceuticals.

Over the past few years, a new delivery model for packaged application functionality has emerged in the form of Software as a Service (SaaS). This model takes the packaged applications business drivers to a next evolutionary stage. Not only do you not develop your own applications in-house, now you don’t even house them in-house. Instead, you access standard applications functionality, such as accounting or CRM, via a Web browser, while the software itself is housed in a data centre run by the SaaS provider. Moreover, you pay for this service on a subscription basis, paying only for what you need and use. This enables organisations to manage their spending more efficiently and eliminates expenditure on unused software licences.

But very few organisations will move entirely to SaaS applications. Instead, many will deploy SaaS tactically, to support a particular project or address an immediate need. From intiial small deployments, many firms have typically then expanded their use of SaaS out into other areas. There are now enterprise organisations with a significant SaaS investment, running mission critical areas of the business via this model. But SaaS applications inevitably have to co-exist with legacy, on premise applications which raises a new integration challenge for many organisations.

Capgemini has skilled practitioners in all aspects of selecting, deploying and managing traditional packaged business applications, established partnerships with leading platform providers such as SAP and Oracle, and a fast-growing SaaS practice with expertise in the new delivery model.

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