Friday, July 13, 2007

The Fundamental Shift

One of the primary challanges for the existing (and new) ERP vendors is to architect their solutions in such a way that it can be made available to the SMB market. In large opart this has been made possible by advent of Service Oriented Architecture (SOA). According to Wikipedia,

There is no widely agreed upon definition of service-oriented architecture other than its literal translation that it is an architecture that relies on service-orientation as its fundamental design principle. Service-orientation describes an architecture that uses loosely coupled services to support the requirements of business processes and users. Resources on a network[1] in a SOA environment are made available as independent services that can be accessed without knowledge of their underlying platform implementation.[2] These concepts can be applied to business, software and other types of producer/consumer systems.

In simple terms, services have now become the gateway to the underlying ERP suite. These services are expected to provide 100% coverage to the business functionality of the ERP suite in future.

What does SOA mean to a small business owner?

The long and short of SOA from a SMB perspective is that it enables the ERP vendors to sell their ERP suites in chunks (chunk can be thought of as a logical grouping of services) on an as needed basis. Therefore, the monloithic ERP suites can now be broken down into much smaller pieces.

The above is where the ERP world is headed. Baby steps have already been taken in this direction. A lot more is yet to come.

Fundamental Shift
Adoption of SOA by ERP vendors fundamentally impacts how ERP software is built, sold and positioned to the customers. It opens up new, hitherto unreachable, markets for the ERP vendors. On the same token, it brings ERP closer to home for the large number of SMB.


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