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Issue of June 2003 
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Enterprise Package Software
Essential things come in Packages

For most enterprises, packaged software like RDBMS, Network Operating System, and Web/Proxy/Mail servers are essential. But one should not neglect other equally important areas like Infrastructure/Network management

Like hardware and connectivity, Enterprise Package Software (EPS) is essential for the functioning of an enterprise. It forms the basis for enterprise-wide applications, communications and other functions that are so critical for the day-to-day functioning business.

For instance, most businesses have connectivity, either by way of LANs, WANs or the Internet—so a network operating system is required. Businesses accumulate data during transactions and this needs to be stored electronically in databases—hence the need for RDBMS. And almost all businesses use electronic messaging or have a website—that's why they invest in messaging and Web server packages.

So great is the need for EPS, that more than half the companies in each vertical have gone in for packaged solutions. Budget-wise and in terms of the average percentage amount spent on technology areas in the last one year, Enterprise Packaged Software was the second-highest area of investment—36 percent of the IT budget. And this trend will continue this year—32 percent of the IT budget will be allocated for packaged software.

However, during 2003-04, overall investment in EPS will reduce. That's because enterprises are slowly reducing their spend in this area. 42 percent will invest in EPS this year and many of the investors (51 percent) will be the medium-sized companies. The verticals increasing investment in EPS this year are Auto/Auto components, FMCG/Consumer durables, and Govt./PSU.

BFSI, which is a major investor in most technology areas, will drastically reduce investment in EPS this year—just 33 percent are investing during 2003-04 compared to 51 percent last year. For banks, EPS is used in the back office. Due to centralization and consolidation, banks are cutting down on the number of branch offices, and are replacing these with channels like ATM and phone banking. Hence the reduced spending on EPS.

What's in the package?

Traditionally, most enterprises considered RDBMS, Network Operating System, and Web/Proxy/Mail server as "must-have" packaged solutions. A fair amount of importance was also given to Infrastructure/Network management. But other areas like Knowledge management tools or Testing/troubleshooting applications were given low priority. This attitude continues today with many considering RDBMS to be the most important area within EPS.

RDBMS is essential software for almost any business. One needs to maintain databases of business entities like users, clients, suppliers, and distributors. RDBMS is also the basis for enterprise applications like CRM, SCM, and ERP.

80 percent of the companies that use Enterprise Packaged Software have RDBMS on their networks, making it the most-used EPS. The BFSI and Telecom/IT/ITES verticals are the biggest users of RDBMS.

Large companies obviously have large amounts of business data and need to use RDBMS more than small and medium companies. 88 percent of large enterprises use RDBMS.

A suitable NOS (Network Operating System) and Web/Proxy/Mail server infra-structure is vital for any connec-ted enterprise. NOSs form the basis on which computer devices within the organization communicate. And Web/Proxy/ Mail servers allow the company to communicate with the outside world.

Low usage for these packages

Infrastructure/network management tools are used by 44 percent of the companies. Testing and troubleshooting tools are used by 26 percent, and Knowledge management tools by 19 percent. The use of these three applications is rather low. And the planned investment next year in these areas is even lower.

Enterprises are spending much on databases and network operating systems, but are not giving too much importance to network management. It's better that they invest in Infrastructure/Network management tools now, rather than spending big on network integrators or consultants later, when complexity sets in.

When there's a lot of data created in an organization through enterprise applications, it should consider putting knowledge-based solutions in place, as a natural evolutionary step.

Testing and troubleshooting tools are mainly useful for service providers and network integrators. Not so much for
companies in other verticals. This explains the low use of these applications.

Planned investment next year

In the next year, the surveyed companies have ambitious plans to invest in RDBMSs and NOSs. 43 percent companies plan to invest in RDBMSs, 34 percent plan to invest in NOSs and a similar number in Web/Proxy/Mail servers.

The planned high amount of investments in RDBMS shows that businesses want to centralize their processes. And it's also a good lookout if companies want to deploy enterprise applications in future.

However, few companies want to invest in Infrastructure/ Network management tools the next year (29 percent). Fewer still are interested in Knowledge management tools (20 percent) and Testing and troubleshooting tools (16 percent).

It seems companies will be busy setting up basic network software applications in place. And this will pave the way for more complex applications in future, which will give the CIO more control over the network.

The next year, the companies should carry on spending in Enterprise Packaged Software since its use has been of positive value. 42 percent of the companies plan to invest in Enterprise Packaged Software during 2003-2004.

Research Snapshots
  • 48 percent of the companies have already made investments in the area of Enterprise Packaged Software. And this is the second highest area of spending for an enterprise in any technology vertical.
  • 36 percent of the entire IT budget had been dedicated to the purchase of packaged software products in the last one year.
  • 80 percent of the companies use RDBMSs, making it the most-used Enterprise Packaged Software.
  • 78 percent of the companies use NOSs and 77 percent use Web/Proxy/Mail servers.
  • 88 percent of the large enterprises currently use RDBMS.
  • Infrastructure/network management tools are used by 44 percent of the companies. Testing and troubleshooting tools are used by 26 percent, and Knowledge Management tools by 19 percent.
  • In the next year, 43 percent companies plan to invest in RDBMSs, 34 percent plan to invest in NOSs and a similar number in Web/Proxy/Mail servers.
NM Suggests
  • Companies, especially large enterprises should keep up the investments in NOS, RDBMS, Web/Proxy/Mail servers since they are the basis for business critical apps.
  • It is necessary to evolve as soon as possible from an information-enabled organization into a knowledge-enabled organization using knowledge management tools.
  • Organizations with high growth levels need to invest in infrastructure management tools to reduce complexity.
  • Organizations that need to train their staff within short deadlines need to invest in knowledge management tools.
  • Organizations like service providers and infrastructure management companies need to use testing tools.
HDFC Bank’s Unified Network Management

HDFC Bank manages its huge, complex, dispersed computing network across the country with Computer Associates' Unicenter TNG.

S.R. Balasubramanian, Vice President, Information Technology, HDFC Bank says, "To enable the offering of our wide range of products and services efficiently, in both the wholesale and retail segments, the IT infrastructure had to be streamlined and tightly managed."

Managed network
For banks running online applications, system downtime can severely affect business. For HDFC Bank, it was not technically and economically feasible to manage assets, solve problems, and distribute and update applications on the network across the country. The network needed to be streamlined and managed from a common window.
It required a tool that could analyze the network, upgrade the links and servers, and add more disk capacity when required. "CA's Unicenter Web Management solution provided the services the bank's IT team was looking for," said Bala.

The modular Unicenter was implemented for better planning of capacity, to manage the IT infrastructure, and to secure and maintain assets centrally.

Single-window view
Now, using the single-window management console, the bank can monitor and manage the entire network without the need to visit remote locations. Explains Bala, "Earlier if an engineer from a remote branch faced a problem, he or she would typically contact the regional office where the engineers would try to solve the problem."

Instead of manually installing, managing, and upgrading software applications, software upgrades and maintenance are performed from a central location—without having to visit the individual users desktop.

Intelligroup's one-stop messaging initiative

Intelligroup Asia, an ISO 9001 and SEI CMM Level-5 ERP systems integrator with a workforce of over 1,200 is using Microsoft Exchange 2000 as its messaging system.

Why Exchange?
Intelligroup was facing numerous glitches in its earlier messaging system. There was no integration between the OS and the mailing system, and the administrator had to create multiple login and e-mail IDs for every user.

Pavan Reddy B, Manager-MIS says, "Keeping with our business philosophy and vision, and the changing demands of the market place, distance and technology, we realized that our messaging solution was not serving our communication purpose. We needed a solution that had more collaborative applications and one that was more user-friendly." He also added that the company needed a solution that would integrate with the OS (Windows) and user database, thereby reducing administrative overheads.

"All these requirements could be addressed if we migrated to Microsoft Exchange 2000," said Reddy.

Message received
The company now has a multi-server environment, where the servers in an administrative group are managed as a single entity. The administrator need not open a separate window for creating the mail ID. The integration of Exchange 2000 with Windows 2000 Active Directory also benefits end users by providing single sign-on capability. The OWA (Outlook Web Access) combined with the FE/BE (frontend/backend) architecture supported by Exchange 2000 makes it easier for users to access their mail-boxes over the Internet using a simple URL.

KM plans
To exploit Microsoft Exchange 2000 to its full potential, Intelligroup is integrating a Knowledge Management (KM) solution (which is still under development) with Exchange as a backend. It will use the Exchange Web storage system for document management and build workflows around it. The solution also includes ORMS (Operating Resource Management System).

Planned areas of investment in Enterprise package software - Vertical wise
  Overall % Mfg./ Engg % BFSI % Auto & Auto comps % Chem & Pharma % FMCG/ Consumer durables % Telecom/ IT/ITES % Govt./ PSU % Services % Health Care %
NOS 34 31 53 15 20 25 41 50 36 25
RDBMS 43 41 63 38 27 50 53 38 45 25
Web / Proxy / Mail server 34 32 53 15 33 31 53 31 9 33
Infrastructure / Network mgt. tools 29 28 37 8 27 13 44 18 17 42
Knowledge mgt. tools 20 13 17 31 20 19 41 31 45 8
Testing and troubleshooting applications 16 9 27 15 20 6 35 25 0 25
Base : All those who have either invested in enterprise package infrastructure or are planning to invest
 
     
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