Strategy No. 4 - Wait for the Bugs to Pass You by.
Companies that can afford to wait for an upgrade are best positioned to get it done quickly - at least from a technical standpoint, says Khadepau, the Oracle ERP veteran who is now manager of financial systems for Multilink Technology, a New Jersey-based maker of optical network components.
Khadepau knows because he is the volunteer director of the New Jersey chapter of the OAUG and has seen his colleagues struggle with 11i. He says one New Jersey company (which declined to be identified) bought the licence for 11i and did not install it. Instead, it sent an IT staffer to monitor meetings of his group until the wails of despair changed into guarded optimism about the software. The company is now installing version 11.55 of the software, which works well, according to Khadepau, and has new functionality that early releases of 11i did not. "Now they come to me and say things like, What was all that fuss you were making about?" he laughs.
Companies have to pick their time to upgrade carefully - especially small companies that don't pull much weight with their vendors. KeySpan's Smith remembers that when she was with Verizon, the telecom giant used to take on upgrades earlier than most customers because it had enormous clout with its vendors. "The vendor would put a big staff of its top people onsite to help us through it," she says. "At KeySpan, we have a tough enough time getting our vendors' attention without risking an early upgrade."
Epilogue - The Upgrades Bottom Line
There is one other strategy that CIOs could pursue: treat the upgrade process as a greenfield. At Nextel, making the shift to the new version of Oracle's ERP software will cost enough and take long enough that LeFave is calling it a new installation and inviting Oracle's main competitors, SAP and PeopleSoft, to bid on installing their system at Nextel. "We've worked hard to build an integrated architecture with ERP" that is heavily integrated with software from other companies, says LeFave. "All of a sudden you have to make this major leap of faith, and that opens up a discussion around should we be doing it with these guys or should we look into the future with someone else?"
The stakes have risen for enterprise upgrades. These projects need to add value, and value is no longer defined by squeaking through an upgrade before the desupport date for an older version. A good planning process, along with regular meetings with fellow users at other companies who can help you organise to get what you want from vendors, is critical.
But old habits die hard. Amazingly, 21 per cent of the AMR survey respondents sold their enterprise software upgrades to their business based on vendors' announcing desupport dates for the software. That's not planning. That's desperation.
As CEOs and CFOs tighten the reins on IT spending, Brother International's Upton pities the fool that tries to get away with such a sales pitch in the future. "If you've got a multimillion-dollar ERP system, there better be a better reason for upgrading than the fact that the vendor won't support it any more," he says.
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