Friday, October 28, 2011

Is SBC this decade's ERP?

It is the deterministic nature of transformational work, such as manufacturing fabrication or assembly, which allows a logical business process model to closely approximate the work performed in the real world.  The work to be done, the methods to be employed, the resources to be consumed all can be determined and modeled.  The development first of Materials Requirements Planning (MRP) and then later Manufacturing Resource Planning (MRP II) and Enterprise Resource Planning (ERP) processes reflect this tight relationship between the real world and the logical world.  At the same time information technology capabilities increased dramatically and costs were reduced by several orders of magnitude.  It is no surprise then that software applications emerged to enable and automate MRP, MRP II and ERP planning and execution processes.

During the period of evolution from MRP to ERP the scope of the business processes incorporated into the model expanded and with it the type of work and class of users expanded.  Transactional (clerical) work, such as order processing, was also codified and enabled by software.  In fact, much of the real world work of transactional workers, such as generating orders forms, stuffing envelopes, sending and receiving mail and filing forms has been automated or eliminated.

Over time many organizations took advantage of the efficiencies gained by refining the roles and the nature of the work performed.  For example, the role of a buyer in the purchasing department has shifted from order placing to source selection and negotiation.  The nature of the new work is less transactional and more intersocial and knowledge oriented.  Knowledge work, however, is much less deterministic than either transformational or transactional work.  There are methodologies, best practices and software applications that can be used to guide and enable the knowledge worker, but the tight correlation between how the real work is done and how the business processes model reflects that work has been lost.  Knowledge work is more abstract and less tangible than either transformational or transactional work.

With the more recent advent of specialized applications, such as Customer Relationship Management (CRM) and Supply Chain Management (SCM) that go beyond the scope of traditional ERP processes, many in industry have adopted more general terms like Enterprise Applications or Enterprise Systems in place of ERP software.  While these applications are exceeding useful to the knowledge worker, enabling the manipulation of large amounts of data in service of improving performance, they fail to capture the social component of knowledge work.  To me they represent an extension of the capabilities beyond ERP, but not a new paradigm that addresses the challenges of enabling knowledge work.

This begs my question to the reader – Are the emerging social business collaboration (SBC) tools, such as Jive’s SBS, Salesforce.com’s Chatter and SAP's StreamWork, this decade’s Enterprise equivalent of ERP?