I have a rule of thumb I try to abide by: Be wary of things that seem too good to be true. If something looks too good, dig deeper.
Packaged ERP DW Solutions
These days the new solutions on the block generating a lot of debate are the packaged data warehouse solutions being supplied by the enterprise resource planning (ERP) vendors (such as SAP's Business Warehouse). The vendors are promoting all the advantages of these systems and, initially, they seem to provide a great solution to a number of problems facing those who are trying to build data warehouses that are fed by ERP systems. But we must ask ourselves, are they too good to be true?
Before I delve into the advantages, let me just state that it was only a matter of time before the ERP vendors started supplying prepackaged solutions. There are excellent reasons why these vendors should provide such a solution (aside from the cynical view that they just want to increase their own bottom lines). A large and rapidly growing number of organizations have ERP systems as their core operational system, and these organizations naturally want to analyze the data at the heart of their company. Many of these organizations began building their own data warehouses to perform more sophisticated analysis than simply running standard reports against the data. The ERP vendors realized that if so many organizations are building their own warehouses to analyze ERP data, they could make life easier for their clients by supplying a packaged data warehousing solution that seamlessly integrates with their ERP system.
These packaged warehouses are targeted at solving real issues. The first issue is that any warehouse worth its weight in salt requires a significant amount of effort to build from scratch. The amount of time and personnel resources required can create serious stumbling blocks for some organizations and can even be prohibitive to a few. If the solution can come out of a box, then the time and personnel resources are greatly reduced and the only issue is the price. By providing such a solution, the ERP vendors create a much simpler way for their clients to get data warehousing functionality.
A second issue is that building a warehouse from scratch to analyze ERP system data is made even more complicated because the ERP system was not written by anyone in your organization. This means the inner workings are essentially a mystery. Though this isn't a situation unique to ERP systems, it means that it is especially daunting to try to understand the formats and semantic meanings of all the data elements that might be required to answer your business questions. Who better, then, to build a warehouse based on your ERP data than the company that wrote the system in the first place? They have intimate knowledge about what all the data looks like and what it all means.
Let the Buyer Beware
Almost seems too good to be true, doesn't it? Though these packaged ERP warehouses do truly address important issues, you must be aware of their limitations. In many cases, these packaged warehouses can become short-term solutions that create long-term problems.
There are two main reasons why this can be so. First, with simplicity comes a lack of flexibility. These packaged solutions have a predefined set of functionality that is hard to change. A problem can arise immediately if the solution the ERP vendor provides doesn't fully meet your needs. You're stuck with what they offer. But, there's an even more significant problem. Even if the solution meets your needs initially, your needs will change over time. These solutions weren't designed to be easily changed, so your needs will eventually diverge from their capabilities. Successful warehouses are designed to be organic so they can grow and evolve as your needs increase and change. These packaged solutions don't address this requirement. Trying to modify these packaged applications can create more work in the long run than creating one from scratch.
Second, though these warehouses are tightly integrated with your ERP application, what happens when you want to integrate this warehouse with other operational systems? Although it is clear that an ERP system is extremely important to any organization that has one, it's a myopic view to believe that it's the only system you will care about. For example, what if you want to integrate data from your sales management system? What if you have a custom distribution system that you want to integrate as well? These packaged warehouses were not designed with these other operational systems in mind. Starting with a packaged warehouse and later trying to integrate other systems can be more difficult than building one from scratch that is architected to scale and grow into other subject areas.
Look Before You Leap
Don't get me wrong packaged warehouses can provide useful functionality for a lot of organizations. They provide another viable option in the marketplace, and I like having more options. They provide a simpler solution, but you will have to sacrifice some functionality, flexibility and scalability in return. Dig deep to truly understand the pros and the cons.
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