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	<title>Engwar &#187; enterprise</title>
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	<description>Chintana Wilamuna&#039;s weblog</description>
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		<title>Exploiting the economic crisis</title>
		<link>http://engwar.com/post/64?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=exploiting-the-economic-crisis</link>
		<comments>http://engwar.com/post/64#comments</comments>
		<pubDate>Mon, 08 Dec 2008 13:16:53 +0000</pubDate>
		<dc:creator>Chintana</dc:creator>
				<category><![CDATA[enterprise]]></category>
		<category><![CDATA[open source]]></category>
		<category><![CDATA[Uncategorized]]></category>

		<guid isPermaLink="false">http://engwar.com/?p=64</guid>
		<description><![CDATA[By now I&#8217;m sure most of you have read more than a dozen articles about possibilities for open source products in the current economic crisis. Even for a fairly large enterprise the annual licensing fee for products that their using &#8230; <a href="http://engwar.com/post/64">Continue reading <span class="meta-nav">&#8594;</span></a>]]></description>
			<content:encoded><![CDATA[<p>By now I&#8217;m sure most of you have read more than a dozen articles about possibilities for open source products in the current economic crisis. Even for a fairly large enterprise the annual licensing fee for products that their using can be a big burden. Charging an annual licensing fee can be understandable from the vendors&#8217; point of view but paying ridiculous amounts of money is going to be a problem to the customers. So I believe that proprietary vendors will come up with some kind of a discount scheme to retain their existing customers. Even then, if you look at it from the business side which has proprietary deployments and pay annual licensing and maintenance fees, if there are alternatives which they can use and cut those prices in, say, three quarters then that&#8217;s an alternative worth considering.</p>
<p>So is open source the miracle cure for every proprietary solutions that cost a fortune on an yearly basis? Although some people talk like it is, reality is much different. A typical CTO will be reluctant to give up an existing deployed solution and go for an open source alternative. This might be for couple of reasons,</p>
<ul>
<li>The system works and it&#8217;s operational going offline is going to cost a considerable amount of money and business disruption.</li>
<li>There&#8217;s no open source alternative out there that is a drop in replacement for any given large proprietary deployment of an ERP, CRM etc&#8230;</li>
<li>What would happen to existing data? Will they be migrated? Can they be migrated seamlessly?</li>
<li>If it&#8217;s a large enterprise operating in many industry verticals, does the alternative ERP system have modules working on those industry verticals?</li>
</ul>
<p>There might be much more reasons, and many more specific to a given organizational setup, I&#8217;m just trying to list some general barriers off the top of my head. Most of all a formal TCO study might have to be carried out in order to justify the decision to upper management.</p>
<p>This is one area where a proprietary vendor, take SAP for example, thrive. They have a single solution where you deploy, tweak some parameters, do a BPR and everything starts to just work. Looking back at open source software vendors, I&#8217;m not aware of a solution like what SAP has to offer. Although SAP is ridiculously expensive a lot of companies are willing to pay money to them. They do have one heck of a product that works for many different businesses. I&#8217;m not sure how Compiere is doing compared to SAP. <a href="http://compiere.com/products/success-stories/index.php">Looks like they&#8217;re doing quite ok</a>. But the 3rd party vendors developing extensions and modules for SAP are several times bigger than for Compiere (if anyone is aware of a quotable statistic please do holler).</p>
<p>Let&#8217;s take another example. If your company intranet is running on Microsoft Sharepoint and you want to ditch that and go for an open source solution what would you be looking at? There is no single open source solution that you can compare with Sharepoint. Sure you can get a set of open source projects, put them together and make it your infrastructure. People who have done this knows how hard it is. Getting two separate projects to work with each other can often be described with the word nightmare. They&#8217;re not built to integrate. Most of them does not expose their data as Web services so you don&#8217;t have an effective method of accessing those. IMO, it&#8217;s another area where commercial offerings of open source projects can partner with each other and provide more integrated solutions rather than single products.</p>
<p>If you&#8217;re a tech startup you could probably put up with 5 different passwords for 5 different systems that you have to use. Wiki, CMS, bug tracker, forums and webmail. Giving single sign on between the applications is an important factor from an end users point of view. It certainly make the system easy to use and accessible. True, you get software like <a href="http://www.ja-sig.org/products/cas/index.html">CAS</a> but a couple of years back when I took it for a spin getting it to work with different apps turned out to be a colossal pain in the arse (it might have become more developed with great many plugins for different systems now, I haven&#8217;t looked at CAS recently). Doesn&#8217;t have to be that way. For solutions like this, built with open source, people are willing to pay money yet nobody is doing it.</p>
<p>So, I believe it&#8217;s a great time to think in terms of integrated solutions rather than individual projects and take those open source projects, make them easier to adopt and integrate into a wider enterprise environment.</p>
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