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by Vishal Patel, Contributing Editor Posted on Thursday, July 20, 2006 11:07:00 AM   On-demand applications are making headlines in a number of functional areas, the most prominent being sales force automation. However, this phenomenon is spreading quickly through the supply management world and in the minds of procurement professionals. Continued pressure to reduce costs, improve performance, and compete globally have elevated the strategic importance of supply management within the enterprise. To mobilize such improvements, procurement executives must compete with other functional groups for scant budget to pay for new resources and systems. In response, procurement organizations are increasingly evaluating available lower cost, rapid deployment on-demand delivery models. The Aberdeen Group defines on-demand supply management applications as externally hosted and managed applications, content, and services that are delivered as Web-based services. On-demand applications also offer flexible pricing models. A recent study entitled "The On Demand Supply Management Benchmark Report" uncovered certain areas in which on-demand solutions perform better than the traditional "license and install" model. The top three were: ROI, ease of upgrade, and implementation time and effort. The findings, which are based on surveys and interviews of approximately 135 industry executives, indicate that there are clear challenges with the on-demand model, two of which are data security and integration with internal systems such as ERP. [Click to continue] |