New Research Download: Separating Network/Platform Church and Application State

This analysis is excerpted from the Spend Matters Perspective: The Great Debate: Will Supplier Networks Thrive, Implode, or Evolve? (free download, registration required). Authored by Pierre Mitchell, Chief Research Officer and Managing Director, Spend Matters, it explores the differences between networks and applications – and some of the convergence areas and risks coming down the pike!

OK, call me old school, but I like to keep the notion of enterprise-class business applications (including cloud-based B2B applications) separate from the “networks” that connect those applications between trading partners – and the technology infrastructure that supports those applications and networks.

I am also fine with the idea of a single company that can offer a cloud-based application suite
and also a business network. They each must compete on their own merits for buyers who want them loosely coupled and also tout their integration for those who like the “on-ramp” (i.e., the applications) tightly integrated to the network. Ariba was the perfect example of this. And if that company also has the scale and chops to provide a Platform as a Service (PaaS) using open source technology (or a more proprietary infrastructure stack if it’s a bigger player), then perhaps it can do all three.

However, there are no barriers to entry for creatively using terms like “networks” and “platforms” to evoke feelings of innovation, flexibility, innovation, etc. And, it can be done without providing too much of that pesky attribute called specificity.

But specifics do matter, and using convenient B2C analogies of Amazon, Google, Facebook, App Stores, etc. might feel good, but don’t always translate back to B2B. For example, Google Apps are a cute network-resident set of components, but the business world runs in Microsoft Office. Yes, Microsoft Office is moving into the cloud with Office360, but it's still an enterprise application. So, let's summarize cloud applications vs. networks vs. platforms.

Enterprise buyers want functionally rich "on-ramps" (i.e., enterprise-class applications that are served up on premise or in the cloud depending on your technical preference and financing preference).

They want these on-ramps (or 'handsets' - pick your favorite analogy) to be agnostic and 'loosely coupled' to the network – although with working integration to a set of add on functionality (discovery, analytics, partner connectivity, etc.) available from the vendor or a set of certified partners

The networks can be private networks/extranets ("private clouds"), public business networks ("public cloud"), or hybrid approaches (although "hybrid" is non-trivial!) A public cloud-based model to deploy cloud applications and business networks can be pursued by a vendor like SAP, but buyers want the networks to compete (with common open standards for inter-operability) in order to have choice, competition, innovation, and choice.

But the providers want to own everything, and like in consumer digital convergence, will nearly give away the handset in return for ‘sticky’ subscriptions.

Vendors who want to provide cloud-based applications, business networks that connect such applications (natively or through partners), or platforms that allow the design/build/run of the applications or the network services, must accommodate a buyer desire for this type of loose coupling in order to serve their needs rather than just seek a big 'land grab' haphazardly. The vendors should also be a little more precise when they talk about these concepts to not create confusion in the market.

Download the Spend Matters Perspective on which this essay is based: The Great Debate: Will Supplier Networks Thrive, Implode, or Evolve? (free download, registration required).

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