Software on a Shelf

Do not buy something you do not need. This principle, while grounded in common sense, does not always inform e-business software buying decisions. The proof lies in the proliferation of "shelfware": software purchased but never implemented.

Two areas that seem to breed shelfware are customer relationship management (CRM) and supply chain management (SCM). According to a recent report by AMR Research, a majority of CRM buyers have implemented less than half of the software they have licensed, and 85 percent of SCM buyers have implemented only one or two modules, although purchases often included additional modules.

One reason for the existence of shelfware could lie with vendors, for whom selling more products means more revenue. Of course, this does not necessarily serve the best interests of users. Andre Kuper, a program manager at Hewlett Packard, is openly dismissive of the modular approach actively marketed by some vendors. "I don't believe you get a better solution with more modules," he says. "It's [only] a benefit if you need a quick fix."

That is just the problem, says Dick Lee, president of consulting firm High-Yield Marketing, explaining that some CRM vendors are trying to make an easy buck off quick-fix modules. "Vendors are in a bells-and-whistles race, piling feature on feature," he says. "Customers are looking for simpler base systems that are more adaptable. Vendors want prices as high as possible."

While the latter may be true, it does not absolve the buyer of all responsibility. As Lee explains, "The onus is also on customers to prepare before contacting vendors. A lot of customers immediately call five vendors for CRM without understanding internal strategy or organizational impact." AMR also advises that implementing certain kinds of e-business software requires internal expertise. Supply chain planning (SCP), for example, cannot be put into practice without a fair amount of intellectual capital; thus, it does no good to buy several SCP modules in the absence of the organizational ability to put them in place.

Any piece of software has the potential to become shelfware if the enterprise buying it does not conduct a rigorous assessment of its own needs in addition to a thorough vendor selection process. But ultimately, the software purchasing process is not rocket science, says Hewlett Packard's Kuper, pointing out that the scale of potential variation in a purchase is enormous. "Let's be honest," he says. "If I can get away with [paying] $60,000 and it works, why pay $5 million?" --Demir Barlas