Your midsize enterprise needs just the right application, but where can you find the one that works for you?
You’ve seen some huge applications, but they have too many features. Typically, they come with a big price tag and a large appetite for eating up network resources. The smaller applications you’ve tested are too limited in their scope.
"A lot of the large e-commerce integrators have no client deals for under a million or outside of the Global 2500," said Christine Overby, associate analyst at ForresterResearch . As a result, it’s challenging to find a service that’s the right fit for a midsize firm
It’s a critical year for midsize companies. In order to help make the most of 2000, TechRepublic examines the top trends predicted to impact the middle market.Part 1: "What IT trends will impact your mid-size business? "Part 2: "The mid-size company: Managing your IT integration"Be sure to look for the final installment, coming soon on ManagerRepublic.
"I think with mid-market enterprises, [CIOs] tend to be more pragmatic, less visionary—not because they don't have the people there thinking along those levels. They are really focused on connecting to suppliers [and] less focused on re-inventing the industry," said Overby. "That pragmatism drives a lot of their technology decisions. I think it pushes them to go with a full service provider, rather than a piecemeal solution."
Not everyone agrees that full service is the answer for the middle market. Some CIOs may be spending money implementing solutions that may require immediate reworking. "Many [midsize companies] are not prepared for all the challenges that go along with the new IT demands," said Allie Young, Dataquest analyst. "They have no experience working with external services providers. One of the things I think may be a problem is that some midsize companies go down one path with a business solution they can't do in a piecemeal fashion."
"The days of best-of-breed solution being the intelligent choice—even for the midsize enterprise—are gone," said Richard L. Ptak, vice president of systems and applications development for Hurwitz Group.” What the CIO and IT professionals need, especially in enterprises in which resources and expertise may be in short supply, are applications that "resolve and address problems in a business-comprehensible manner," he said.
Ptak recommends a collection of IT solutions and tools that come in a suite, such as a Tivoli or a BMC. They can be easily installed and used in a modular fashion.
Why not try an ASP?
How do you find a one-stop shop for every enterprise need? Enter the Application Services Provider (ASP).
"I think that the attractiveness of an ASP for a mid-market company is that they have one person to go to," said Overby. "There's no cobbling together a best-of-breed solution. They can, in a sense, tap into some of the applications they might not have been able to buy because of cost and skills reasons."
You snooze, you lose
Technology gives midsize companies the ability to compete against major companies who are already competitive in e-business. With the help of service providers, the smaller companies can move into e-business and hold their own against the competition.
“It’s just moving much too fast,” said Young, ”They have to expedite that process by using external providers. It’s a business necessity. If they are slow, they will lose.”
Midsize companies should consider hiring consultants to help with enterprise implementations, according to Tom Davenport, Director of theAndersen Consulting Institute for Strategic Change. He said that what many IT professionals don’t realize is that once a system is installed, it's a way of life. “They shouldn't view ‘going live’ as the end of a project—they've just started," said Davenport.
He recommends you ask two basic questions:
- How will you get business value out of the enterprise system?
- How do you use it to advance your business strategy?
For some organizations, their technology strategy had been simply surviving Y2K. "CIOs and CFOs are saying, 'Weren't we supposed to get some business value out of the enterprise rather than just getting past Jan. 1?' Now organizations have the time to think, 'What should we do next?'" said Davenport.
Selecting and managing vendors
To select a vendor, weigh the trade-offs between price, quality, size, and flexibility.
"The New World is changing very rapidly, and it is critical that you find partners you can trust to run the parts of your business that will be critical to your success," said Inacom's Kevin Dorhmann.
Vendors are no longer simply making products; they're providing outsourced services, too. As a result, you may need to budget for a consultant.
“Selecting a set of vendors in the space around networking and ASPs should be done with care because you are actually choosing someone who will run parts of your business day-to-day," suggests Dohrmann. Here is his outline for the process:
- Find ASPs that support the types of application you are looking for, making sure that they have the capacity and support offerings—or SLAs—you will need.
- Compare pricing and features.
- Visit the vendors when you have narrowed your choice to two or three providers.
Beware of snake oil salesmen
Look for solutions that most effectively address your business problems. During the sales pitch, some vendors may try to manipulate your company’s problems so they fit the solution the vendor is selling. Midsize businesses ”should not allow the vendor to hijack the decision making and requirements definition process," said Ptak.
Caldwell recommends that you arm yourself with well-defined requirements. This allows the company to obtain the services they want with a vendor that has a clear understanding of what the objective is—and that’s a successful strategy.
How did you bargain for the best ASP deal? What were you looking for from your ASP? Post a comment below to share your application success story or nightmare.