Editor’s Note: This article is based upon Ardent Partners’ recent report, The CPO and CIO’s New Approach to Evaluating Enterprise Technology (sponsored by Coupa). Click to download (registration required).
Historically, most Chief Information Officers (CIOs) and Chief Procurement Officers (CPOs) have led their respective organizations independently of one another and focused their resources and efforts accordingly. They also tended to evaluate enterprise software solutions differently, reflecting their unique perspectives, and in some cases, their own departmental goals and objectives. In the past these approaches were warranted. But today, selecting enterprise software requires a different, more collaborative and results-focused approach driven by the significant changes the enterprise software industry has experienced over the last decade.
Technological Innovations Driving Business Changes
Major business trends, like agility, innovation, and speed, have facilitated a shift in how leading CIOs, CPOs, and line-of-business constituents approach technology selection and integration. This transition has several facets. For starters, enterprise software, particularly cloud-based solutions, have become easier to deploy and use; and they have become more cost effective. Thus, line-of-business leaders have become more empowered in the discussion. Taken together, IT has generally become smaller, ceded power to the line-of-business, and become more collaborative. For its part, procurement has also evolved, the role of the CPO has emerged, and the procurement’s influence has grown significantly. Today, progressive CPOs know that the goal is to influence enterprise spend, not frustrate stakeholder initiatives or stifle progress with heavy-handed mandates.
In the new millennium, IT solutions have become more robust and easily integrated with IT infrastructures and legacy platforms. In particular, cloud technologies and solution suites have come into greater use with a majority (54.6%) of CPOs adopting hosted, software-as-a-solution (SaaS) deployment models in recent years (see Figure 1). In a cloud-based business environment, technology integration times and costs can be significantly reduced, and their impact on IT can be much lower than traditional integrations. With cloud-based solutions, IT no longer has to maintain, secure, store, upgrade, or troubleshoot these solutions for the enterprise – all of these duties are essentially outsourced to the cloud solution provider. Users may want to consult IT throughout the integration and service contracts for best practices. But cloud-based solutions offer all stakeholders a faster “time to value” with shorter deployments times and faster adoptions. IT can expend fewer resources and focus on driving compliance and offering best practices – areas where they can be value drivers.
Figure 1: Top Technology Automation Strategies
Meanwhile, suite-based platforms, adopted by 40.3% of enterprises, offer organizations end-to-end solutions that can create symbiotic relationships among the applications. They provide users with single sign-on capability and common interfaces and user experiences for disparate applications – like signing into one’s Google account and having access to all of their Google applications, like Gmail, G-Chat, Drive, YouTube, and so on. Users can also automate and link dissimilar processes, and enable users to pull outcomes (e.g., data, analysis, intelligence, etc.) from one application into the next to create a process value chain. Solution suites usually “speak” common programming languages and can link applications and processes. And they can be implemented across the enterprise, providing modularity to meet the unique needs of each business unit while also providing uniformity of delivery, interfacing, and programming. Selecting a solution suite that is the best value for the enterprise can allow IT to allocate fewer resources to manage disparate vendors and solutions and reallocate them to other, more strategic matters.
There is still a market for best of breed solutions, an approach taken by roughly 25% of the market, particularly in new and emerging areas. However, thousands of respondents to a decade’s worth of Ardent Partners research shows that the clear trend is towards suites, which reflects the transformation of enterprise technology seen over the past decade.
Final Thoughts
Technologies have evolved in recent years to the point where they have imparted meaningful and lasting changes upon the way that enterprise leaders, like the CIO and CPO, evaluate and leverage them. Today’s business solutions have flown well beyond the old way of conducting B2B relationships, and are opening up new opportunities for the CIO and the CPO to drive new and meaningful value within their departments and across the organization.
Want to learn more? Download The CPO and CIO’s New Approach to Evaluating Enterprise Technology (sponsored by Coupa)!
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