"The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency."
- BILL GATES
There are two categories of business software packages:
Horizontal business software is designed for a broad range of businesses. It typically includes General Ledger, Accounts Payable, and Accounts Receivable. Quickbooks Pro is an example. More expensive horizontal packages may include Payroll, Inventory, Order Processing, Service Orders, Job Costing, Bill Of Materials, Forecasting, etcetera.
Vertical business software is narrowly focused on a specific type of business. It attempts to manage every facet of the target business. Sometimes it includes access to manufacturers' pricing data. Dedicated vertical packages exist for:
Which makes sense for you?
Horizontal software packages
May require work to integrate into your operation
Rarely do everything you need without customization
Allow (if not require) customization
Entry costs are usually lower (but you may never achieve full integration)
Vertical software packages
Sold and supported by people who know the business sector
Sometimes they do everything you need
Require that you to do things their way
Support costs can be high
Some modules may be weaker than others
What to look for
Whether you choose a Vertical or Horizontal package, look for "open-ness". Sooner or later, you'll need (or at least want) to interface your data to the outside world. Interfaces include the ability to
Import data
Export data
Read live data in real-time
Write to live data in real-time
What is meant by "open" and "closed" systems? |
Closed systems try to "lock in" users by using proprietary file formats. They may or may not include data import and export facilities. Such systems are difficult to replace because it's tough to extract the data from the old system. It may be impossible to make them "talk" to other systems that you acquire. It may even be difficult to create your own customized reports. I recommend that you stay away from such systems. | Open systems offer full open-ness, with documented file layouts and interfaces. If you're lucky, the system's database management system will offer a SQL (structured query language) interface. Some allow you to add indexes to existing data and create your own views of your data. These systems remain useful longer than closed systems because they adapt to changing environments. |