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Open-source ERP, BI firms take a tag-team approach

Open-source ERP, BI firms take a tag-team approach

Openbravo and Pentaho are business applications designed to solve business problems.

Two open source companies have partnered to provide an integrated BI and ERP offering that should minimize the complexity that an open source deployment typically renders.

Ease of deployment is the goal for organizations looking to deploy a BI and ERP component in their IT infrastructure because "in general, [open source] is great technology but sometimes it's a little bit too techie," said Josep Mitjà, chief operating officer with Openbravo, a Spanish-based vendor of open source ERP and point-of-sale systems.

The other vendor, US-based Pentaho offers open source BI systems.

In the end, continued Mitjà, technologies from Openbravo and Pentaho are business applications designed to solve business problems "so we want to simplify and hide the complexity as much as possible so people can really focus on business problems than technology configuration problems."

Lance Walter, Pentaho's vice-president of marketing, said he's observed many organizations experience huge success with open source, be it the Linux operating system or the MySQL database, and that going to market with an integrated offering will especially target "those companies that have already experienced the open source benefit, [therefore] it's very familiar for them and very easy to fit into their existing processes."

But while experienced open source organizations will likely be the fastest adopters of the integrated offering, Walter said all businesses are increasingly realizing "that the future IT infrastructure is a combination of open source and traditional technologies working together."

Although Openbravo has a midmarket focus, said Mitjà, the company does cater to diverse clients as the reality is "with open source the product goes ahead of you because sometimes you learn people are using it in unexpected places."

George Goodall, senior research analyst with Info-Tech Research Group, said he anticipates adoption of the integrated offering will happen primarily among smaller companies or at the divisional level of larger companies, given ERP is a "tremendously complicated" technology by virtue of the fact that it deals with many different business processes and legislation. Commercial ERP providers, he continued, provide valuable industry experience, deployment processes, and industry models above just the rudimentary modules. And cost-wise, open source still brings service costs.

"But that said, it's very early days for open source ERP. The issue for companies like Openbravo is to develop that experience, develop those industry modules, expand their platforms," he said. "And that's a similar story to what we were hearing from ERP vendors 15 years ago."

However, Mitjà doesn't agree that enterprises won't tread in open source technologies. While it's true that the penetration of open source in larger established companies tends to occur more at the infrastructure layer than at the enterprise application layer, he said, "there is a trend there, so in large companies after understanding how to deal with open source... they feel more and more comfortable."

And ERP systems, said Mitjà, are not the sole territory of enterprises either. There are various factors "forcing" companies to migrate to ERP systems, like those conducting business in the food industry that need to stay compliant, or those interested in market competition who want to track market data. Increasingly ERP adoption is observed in the small to medium-sized sector, he said, adding that major players like Microsoft Corp. and SAP AG are investing heavily in that sector.

But besides an integrated solution that cuts deployment complexity, Walter said the OEM agreement grants Pentaho opportunities to collaborate with the established large communities that Openbravo brings to the table. Openbravo started the Open Solutions Alliance, a vendor-neutral consortium formed to push adoption of open business solutions, in 2006.

Goodall noted the benefit that the OEM agreement renders to both companies is more than just the technology, considering that while open source technology is relatively easy to acquire, the implementation help is not. "Really what Pentaho brings to the table is the depth of industry experience and just the partner network because that is really what this is about."


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