Cloud, mobile, AI and the unbundling of enterprise apps

The traditional suite of enterprise applications — ERP, HCM, CRM and SCM, or more prosaically money, people, sales and spend — reflects the functional organization of the traditional enterprise. In other words, these applications have their roots in functions that were originally defined by the need to marshall operations using the flow of paper documents around the twentieth-century enterprise.

Those functional boundaries are beginning to dissolve in the digital enterprise. Connected technologies, most notably cloud computing and smart mobile devices, make it possible to connect up data and processes across the old demarcations. Where once each separate function managed its own dataset and only occasionally married up data with adjacent operational silos, today's connected digital infrastructure makes it possible to share data in real-time and access it anywhere.

This convergence of data and processes is mirrored in a huge uptick in people working together across functional boundaries. That is why I often write about collaboration as the new fifth pillar of enterprise applications in the digital enterprise — although rather than being another discrete silo, it is more of a catalyst for merging them all into a single digital fabric.

A single functional continuum

An example of what happens when one of the old enterprise applications is reimagined as part of a single functional and data continuum can be seen in the recent launch of NetSuite SuitePeople. Unlike a traditional HRIS, this embeds HR functionality directly into business operations and can't be bought separately from the core NetSuite business system.

This means traditionally discrete HR actions such as booking time off can be accessed in the midst of planning project schedules, while recognizing good performance can be part of recording the completion of a sale. Instead of forcing staff to open a separate HR app to update their details, they just do it within the same dashboard where they claim expenses or check their schedule.

This convergence of functions is set to accelerate with the spread of artificial intelligence, which eliminates the need to open up a specific app to perform a function. Instead of users having to visit the application, AI agents bring the function to the user, via a natural-language messaging or voice interface — for example, Unit4's Wanda virtual assistant.

This week, quote-to-cash vendor Apttus has been showing off an intelligent agent called Max at its annual user conference in San Francisco. Apttus is already breaking down conventional application boundaries, bringing together configure-price-quote, contract management and billing into a single platform that also runs CRM and sometimes ERP functionality from either Salesforce or Microsoft. Max brings all those functions to the user via a chat interface that can be addressed from a variety of media, including voice command, text inputs, Skype for business, email and even augmented reality via a Microsoft Hololens headset.

Max AI and headless apps

Available to customers since early this year, Max is already proving itself as a huge boost to productivity and can also improve revenues per sale, says Apttus CEO Kirk Krappe. At one customer that is rolling out Max to several thousand field sales people, the sales person can quickly specify a quote using natural language interactions from their smartphone. That means they can prepare the quote while meeting the customer instead of having to go back and load up the application in the office, which gives Max the opportunity to make upsell suggestions on the spot. This is a gamechanger for these sales teams, says Krappe:

We think there's just an absolute, conversation with your rep component, that makes it much easier from an efficiency [point of view], but we think there can be huge revenue improvements overall.

Enterprise applications vendor Infor recently showed a concept design for a similar agent, coincidentally also called Max. Again, the idea is to transcend the artificial barriers between individual applications so people can get stuff done faster:

Project Max ... uses intelligent automation across Infor's Sales Suite products to provide timely information, reminders and action prompts to sales reps as they're working out in the field. The aim is to 'automate work away' and maximize efficiency.

Interacting via agents rather than directly in a traditional app is also on SAP's product development roadmap, as Yvette Cameron, SVP Strategy & Corporate Development at SAP SuccessFactors recently told diginomica:

People say, ‘Well, what’s your UI going to look like in five years?’ and I’m saying you probably don’t have to touch the laptop. It should be fully voice command and the intelligence should interpret what you’re saying and take it forward.

Unbundling functionality and the enterprise

In all of these examples, the traditional bundle of functionality that makes up an enterprise application has been broken down into separate components that are then recombined in new ways to provide a different, more streamlined outcome that wasn't possible without the new technology. This is a phenomenon known to economists as unbundling and rebundling and it's invariably a harbinger of disruptive innovation in a given field as new patterns of consumption become possible.

Venture investor and Silicon Valley tech luminary Marc Andreessen once gave this example in a Harvard Business Review article:

Music is a great example of that. It made sense in the LP and CD era to put eight or 10 or 12 or 15 songs on a disc and press the disc and ship it out and have it sit in storage until somebody came along and bought it.

But, when you have the ability online to download or stream individual tracks, then all of a sudden that bundle just doesn’t make sense. So it collapsed apart into individual MP3s. And I think now it makes sense that it’s kind of re-bundling into streaming services like Pandora and Spotify.

Now unbundling has reached the field of enterprise applications, due to the combined effect of integrated cloud platforms, smart mobile devices and intelligent agents. As these three enablers work in concert to pick apart the existing landscape of conventional application silos, expect a wave of unexpected, innovative new combinations to emerge. That will have further consequences, as I outlined in a previous article exploring the effect of unbundling on the enterprise itself:

Today, we are in what I would call a third phase of unbundling, in which the individual jobs and processes themselves are being picked apart with the aid of digital technology.

Expect to see new models of enterprise organization and teamwork to emerge as new functional bundles of automation enable new ways of working together to achieve business outcomes. The unbundling of enterprise apps foreshadows the unbundling of the traditional enterprise itself to create a vastly more frictionless model for tomorrow's digital enterprise.