The buzz-word for the coming years will be business intelligence software. ERP, CRM, SCM and a host of other back office and customer-facing automation software have transformed the enterprise from paper silos to massive boxes of electronic data or information. Now all that the “intelligent” enterprise needs to do is take a shovel to the data and start clearing up and stacking information into useful banks. Presto! They are now more agile, informed, responsive...more about this in a bit.

There is a strange contrarian slicing of the market opinion today. On the one hand, CIOs haven’t stopped wringing hands about their shrinking IT budgets, unused shelfware, and the island-like applications that dot their enterprise architecture, all adding to the stress within the IT departments. On the other hand, enterprises are making do with much less than before—notably with people. Layoffs have become a standard feature in improving quarterly results, yet companies haven’t become any less efficient due to this, says an industry analyst. And this has a lot to do with the IT empowering teams within each department to perform better.

Randy Bean, managing partner at NewVantage is cautious in his analysis of the enteprise software market. In the wake of rampant investments in new technology products and firms during the late 1990’s and early 2000’s, Fortune 1000 (F1000) businesses are showing greater caution than ever when it comes to incurring potential risk. With tens of millions of dollars of software investments sitting unused, underused, or with companies no longer in existence, big F1000 buyers are looking to take the safe route.

As one F1000 CIO recently expressed it, “If we could buy everything from IBM we would, even if we had to wait a few years to get the functionality we needed.” The implications of this new mindset for emerging technology firms and their investors are troubling. More and more large firms, even in an improved IT spending environment, are deferring investments in emerging solutions, or are taking the more conservative approach of choosing to wait for an established vendor to develop the required functionality.

Even in the instance of those emerging firms that are experiencing success in selling a new technology solutions, many are being compelled to execute the deal through a large systems integrator such as IBM Global Solutions—prompting the question: who is the customer now? IBM or the enterprise? Bean is concerned that this may stifle the innovation process.

ASP in flavor
Chris Thomas, Intel EStrategist, recently outlined some themes of the enterprise software market, two of which I felt were in context to this article, though neither of them were new. He defines them as:

Software and data delivered as services

Think ASP model, think modular, software components that perform a specific task, which can be used as building blocks and combined with other components via web services to solve a specific business problem
This will be the new way to build software and go-to-market
He gave an example of how AT&T used a combination of hosted software vendors and their APIs to deliver an order routing solution for a customer in 2 weeks instead of 9-12 months

As a side note, he adds, as we move into an increasingly global world, no need to worry about software piracy since you can't steal a service but you can steal sofware

Hardware as a virtualized resource
View hardware as one set of services

Manage capacity on demand
New hardware=new software opportunity
Despite the hype of SOA (service-oriented architectures), it is beginning to happen, it is real, and it is still early. As we move into this world of SOAs, there will be tremendous opportunities for software investment as enterprises consolidate, modularlize, and virtualize their data centers.

RFID in the Data Environment
A paper by Professors Edmund W. Schuster and David L. Brock of MIT, offers a future prediction about how enterprise resource planning systems will need to evolve to deal with all the data collected through RFID:
...[C]omputer science researchers have conceptualized a new type of information technology infrastructure that meets the challenge of real time information and unique identification. This type of infrastructure aims to link physical objects to a network, like the Internet, with RFID technology. There is no question that this new infrastructure will radically change the nature of ERP systems with the result being an order of magnitude increase in productivity. Traditional forms of delivering information technology, such as dedicated software packages that require strict adherence to predetermine ways of planning, will yield to repositories of "software agents" such as planning and scheduling models that will be combined as required to meet the needs of existing organizational processes. This will result in a truly intelligent infrastructure that will allow great flexibility in collecting data through RFID technology and the matching of relevant models to the data at hand.
Such a system is only possible through development of open standards and protocols for collection, sharing and matching data to models. Without a system based on open standards, interoperability will not be possible and the economics of building suitable interfaces will overwhelm the economic value of the new infrastructure.

Point to note. As more real time data becomes available through RFID, the nature of ERP systems will have to change. While some argue that RFID is useful only in the supply chain, sufficient middleware layering can render RFID data useful for the enterprise itself, underlining the market cry, “Enterprise” It’s all about data.”

The Intelligent Enterprise
Web services have dramatically enhanced our ability to collect new types of data from outside the enterprise while RFID initiatives promise new magnitudes of unique real-time data that somehow has to be consolidated, cleansed, transformed and deciphered.Companies have more sources of information to harness, more data to integrate, and more people clamoring for more types of information (faster, better and cheaper) than ever before. To address this growing concern, developers are focusing on next-generation information infrastructures that will, in essence, be intelligent. This new technology will "understand" how to optimally adapt to system and data process changes, and will make necessary adjustments automatically and thus much more quickly than infrastructures that rely heavily on human intervention.

Data integration (DI) resides at the nexus of this agility. Without data integration, there is no information infrastructure, not today, not tomorrow. DI moves, consolidates and transforms the most fundamental IT building block -- data. It feeds increasingly voracious business intelligence (BI) systems, executive information systems, and all kinds of data warehouse and data store-based initiatives. It is integral to real-time enterprise computing, ZLE (zero latency enterprise), eCRM, business activity monitoring (BAM), and other high-value initiatives. And it will be critical to RFID as the way to amalgamate and manage the projected torrents of data.

Adaptive DI covers a lot of territory. It starts with detecting and adapting automatically to minute-to-minute changes in data—transactional, operational and metadata. This means detecting and adapting to changing data volumes and to changing patterns in the data in order to optimize its processing. Is the data real-time, batch or changed-data? An adaptive DI platform should be able to adjust intelligently to capture and integrate it all.
Adaptive business intelligence is primarily about flexibility. It means delivering business intelligence to any information device or appliance specified by the end user. It means being able to readily insert business intelligence capabilities into portals and applications, often through Web services. And it means being able to run a business intelligence solution on top of any application server, right out of the box, and being able to switch application servers at will, without having to make costly and time-consuming changes to the business intelligence software.

Where Next?
On-demand is creating a fresh churn in the market buying methods. It goes beyond ASP, and is promising more than your current infrastructure capabilities. Today, our information environments are human directed. Tomorrow, automated solutions will detect and respond to change as it happens. The more readily our information environments can adapt, the more we can do as people in terms of being creative, strategically oriented, and productive.

The Internet economy is more egalitarian than any marketplace has ever been. No more “We’re better than our competition because of our superior technology,” or “We’re better because we have data (information) that our competitors don’t have.” In a world where information is more available than ever (and increasingly fleeting) it’s no longer about keeping the mission-critical information to yourself, or playing off proprietary information strategically, it’s about using all the information available to you more wisely than anyone else.

All this promise to be the next evolution for the enteprise software market.