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Short History of Business Software (culminating in ERP systems)

Short History of Business Software (culminating in ERP systems) . Phase I – 1955 to 1965 Computers are new and far more expensive than people Software comes from the hardware manufacturer (bundled) or written in house in FORTRAN or COBOL Phase II – 1965 – 1983

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Short History of Business Software (culminating in ERP systems)

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  1. Short History of Business Software (culminating in ERP systems) • Phase I – 1955 to 1965 • Computers are new and far more expensive than people • Software comes from the hardware manufacturer (bundled) or written in house in FORTRAN or COBOL • Phase II – 1965 – 1983 • Software ‘unbundled from the manufacturer’ • The golden age of software • Great economic justification for applications – stand alone, i.e. payroll, general ledger, inventory control • Most systems and applications separate– the age of the silo • Modular (integrated) systems are leading edge

  2. Short History of Business Software (culminating in ERP systems) (2) • Phase III – 1983 – 2000 • PC networks kill off mini-computers, dominate the field • People now much more expensive than hardware – software development costs skyrocket • ERP systems grow in popularity due to: 1. high development costs 2. high risk of failure for in-house development 3. concentration on “core competencies” • Phase IV – 2000 – present • All but strategic systems outsourced or handled internally with commercial ERP software

  3. ERP systems defined (for this class) • Characteristics of ERP systems • Modular – multiple applications (application =module) from a single vendor can be purchased individually and integrated at any time • Purchased from a vendor, not developed in house • Modules are for common business applications (functions) • Confusingly, stand alone systems (BI, CRM) can also be ERP modules. If built in-house or purchased from specialty software developers rather than from SAP or other ERP vendor - then they are NOT ERP systems. • ERP counter examples • The Nevada DMV system is a highly specialized custom written system – not an ERP • Most applications for Financial companies and commercial banks are custom written • Many real estate valuation and sales and insurance programs are custom

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