From the Principal’s Office
The economy improves, albeit slowly. Many retailers are seriously undertaking information systems initiatives, some avant-garde; some are replacing aging systems due to growth, discontinued support, or disenchantment with their current solutions provider. There is activity in the marketplace. I thought I would tackle a topic near and dear to every IS manager at one time or another: to upgrade packaged software or not to upgrade?– Bob Amster – Principal, RTG
Packaged, Licensed Software Applications – To upgrade or not to upgrade?– By Bob Amster
At some point in their career, IS&T managers must decide whether to upgrade licensed software applications or not. This decision is not always easy for many retail companies. Let us agree that, for the sake of this discussion, “upgrade” means installing a newer version of the same product (whether the latest or not).
The typical scenario starts when retail company A buys package B and installs it. From this point on, a number of things can happen. In one path, the retailer continues to pay the annual maintenance charges. In the other, it does not. In yet another path, the retailer modifies the product slightly or extensively, while in the other it does not, at all. At some point down the road, the retailer will be presented with a quandary: to upgrade or not to upgrade (Hamlet all over again).
Many companies faced with upgrading old software can’t simply do that because they have modified the original product so much, that it is not upgradable, even if the retailers had not stopped paying the maintenance fees that often entitles them to ‘free’ upgrades, long ago. To ‘upgrade’ at this point, represents a redeployment of the application, as if it were a new application. This is a more serious, costly, and disruptive effort than a simple upgrade.
Some retailers choose to not regularly upgrade their software because they cannot ‘see’ an immediate benefit to the business by doing so and don’t wish to incur the expense or cause whatever disruption to the business. Thus, they begin to fall behind in releases. I find this a very shortsighted view of the information systems world.
The negative impact further exacerbated if the company needs to comply with a regulatory mandate. If new laws are enacted with which the retailer has to comply within a certain time frame, and the retailer has not been keeping up with current releases of the application, now, it’s a do-or-die situation. And we all agree that we don’t like to work under those constraints.
On the other hand are those retailers and IS&T managers who make few or no modifications to the application, stay on maintenance with their solution provider, and continue to upgrade, staying no more than one version behind the latest.
If you are in the first camp, there is not much you can do but bite the bullet and replace the software. But how can you avert the quandary in the future?
First, we have to live by a rule that says, we don’t ‘customize’ the software if it means that we now own our own unique copy. We either negotiate to have the ‘modifications’ inserted as part of the base product code – which the solution provider agrees to maintain – or we don’t modify the application. (Some, more recent architectures are layered in such a fashion that we can insert custom code in a layer where it does not impact the base product code.)
Second, we stay on maintenance and continue to pay it.
Third, we regularly upgrade to the next version of the application and stay no more than one version behind the latest even if there does not appear to be an immediate benefit to the upgrade. There is sure to be a long-term benefit to it and we, IS&T managers are supposed to, and get paid to think ahead, plan, anticipate, and avert problems down the road.
We reach the end of the road when the software company, and not we, decides to sunset the application. Unfortunately, we have seen this happen enough times and we have no control over that.
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We are engaged by Centripetal Capital Partners to select retail software for inventory management, POS, CRM and more for this early-stage, successfully growing, regional retailer.
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We are engaged with this prestigious designer brand to assist in the improvement of a number of system and process issues. There are 49 freestanding TOM FORD stores and shop-in-shops in locations such as Milan, New York, Chicago, Tokyo, Las Vegas, Dubai, Zurich, New Delhi, Shanghai and Moscow.
We are working with this long-time client, a successful, privately held, regional chain of 85 tire dealerships to select and implement a suite of retail applications from POS to Inventory Management and Financial Management applications.
Robert Lawson continues to work for a major software developer of in-store solutions for a number of key retail clients.
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