Enterprise Software and Cloud Computing Blog

Enterprise Software, Necessary Evil or Saving Grace?

Nathan Joyes |

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As printed in the Spring 2012 issues of TheFranchiseVoice, Volume 13, Issue 2

Success rates for traditional enterprise software implementations are abysmal, yet all but the smallest franchise systems rely on enterprise software to be successful.  Should we just resign to the fact that enterprise software is a necessary evil that must be endured?  In the past, you may have been tempted to do so, but today there is a whole new breed of cost-effective enterprise software that is offering new hope.  In fact, through resulting cost reductions and increased purchasing rebates, enterprise software may actually be the saving grace for franchise systems during difficult economic conditions. 

 How Traditional Enterprise Software Measures Up


Traditional Enterprise Software

Software as a Service (SaaS)


large upfront capital investment in software

all-inclusive, predictable monthly subscription

Routine Updates

purchased from vendor by contract or per update

all routine updates are included in subscription fee

Program Maintenance

deployed by client to affected local servers and

automatic program updates managed entirely by vendor

Technical Support

purchased by contract or paid per incident

unlimited technical support included in subscription


costly standalone server hardware and server

multi-tenant infrastructure managed by vendor


costly and slow document printing for direct mail

electronic communication by EDI, or email


varies with backup/restore procedures and in-house

professional maintenance included in subscription


depends on skill-set of internal IT compared with

regularly tested for threats and vulnerabilities


increase in usage requires costly hardware upgrades

add users or increase transactions at any time


downtime can last for days depending on the problem

24x7 network monitoring included in subscription fee


only internal employees and some limited remote

staff and business partner access from anywhere


no vendor obligation after initial implementation

vendor must continually ‘earn’ the subscription fee


information is often posted daily or weekly

information is updated in real-time

Learning Curve

proprietary interfaces with steep learning curve

standard html web pages with very little training

The new breed of enterprise software has been written from the ground up to take advantage of cloud computing.  Cloud computing is the practice of using a network of remote servers hosted on the Internet to store, manage, and process data, rather than a local server.  At this point, you may be thinking that sounds a lot like a website and wondering what all the cloud computing hype is all about.

It is true that web pages are the user interface of choice for cloud computing and you already know the benefits of web pages: accessible from any location, using any device, with any flavour of web browser.  But to better understand what makes cloud computing special, you have to consider the data that is being managed through these web pages.  It’s great that I can access Google search data from anywhere, but having access to Gmail is much more impressive, because I can access my data from anywhere.  It’s ‘cloud computing’ because I am able to read a note from my client, send a message to my staff, organize my email and manage my data from any location, using any device, with any flavour of web browser.

Now please don’t stop reading with the conclusion that cloud computing is really just web-based email.  I just use that as a simple example for a starting point that we can all relate to.  As you may be aware, Google also offers documents, spreadsheets, presentations and other productivity tools in the cloud through Google Docs.  Not to be outdone, Microsoft launched Office Web Apps to enable users to create and edit office files online.  In both of these cases, the software is much more complicated than a simple web page, yet as a user, I do not have to worry about installation and upgrades because the software vendor manages all that.  My data also resides in the cloud in both of these cases and I do not have to worry about backing it up, because the software vendor takes care of that too.

Gmail has been with us for many years now, but more recently we are starting to see large enterprise software applications being offered in the cloud - the kind that can be used to run an entire franchise system.  This is a fairly recent phenomenon, as we have embraced reliable high-speed Internet connections across the nation and software vendors have developed new multi-tenant applications that are designed to run in the cloud. With a multi-tenant application, many companies, or tenants use the same application over the Internet, but they can only access their own data.  When the software can be accessed over the Internet, a whole new business model for enterprise software emerges.  Franchisors are no longer required to pay large upfront costs for hardware, software and a team of consultants to implement the system, but can simply access and pay for software as needed.  Purchasing software as a service, or SaaS as it’s called, enables franchise systems to be up and running at a fraction of the time and cost of traditional enterprise software solutions.

But it’s not just about saving time and money.  Automation through enterprise software can play a key role in increasing revenue and improving profitability for a franchise system.  Corporate chains have long benefited from vendor rebates, credits and discounts as a result of processes like these, automated through enterprise software:

  • electronic product and price lists, in lieu of creating and mailing paper-based catalogues

  • electronic orders in a single format, eliminating costly phone, fax and email order methods

  • electronic delivery of invoices, rather than printing and mailing out paper

  • electronic payments and remittances, in place of manually receiving and depositing cheques

You may be among the franchisors that have been quite content leaving these transactions between the franchisee and the vendor.  That probably makes the most sense for small franchises, or those that are service based with minimal supplies.  But when it comes to systems that require franchisees to procure supplies on a regular basis, supply chain automation represents a great opportunity.  Vendor automation credits and discounts can often eclipse the costs associated with today’s cloud-based enterprise software.  The resulting boost in profit can be a real advantage for franchise systems that have suffered from the global economic decline of recent years.

In addition to cost-saving and revenue-generating opportunities available from vendors through enterprise software automation, there is a wonderful by-product for the franchisor called visibility.  Having a detailed view of ordering activity can help the franchisor negotiate purchasing discounts, project sales and validate franchise fees.  We should also consider the improvements in efficiency for your franchisees.  Ideally, franchisees have a single online source for ordering and paying for both restricted and non-restricted supplies, 24/7 from any location.  Going beyond the supply chain, there are also opportunities to improve communication and collaboration throughout your network with discussion forums, e-newsletters and a group-wide Intranet.

What about the opportunity to increase unit sales?  Prospective franchisees are looking for a proven system and will be attracted by franchises that go beyond the basics by providing automated ways for them to reach out to their customers, through custom franchisee web pages, promotions, mailing lists, etc.

There is really no end to the opportunities available for franchise systems through enterprise software and when it comes to the cloud, the sky really is the limit.

About the Author

Matt Bondy is president of Interprise Software and has been involved with every aspect of enterprise software development for over 20 years. A graduate of the University of Waterloo’s world renowned Computer Science program, Matt spent a few years working in very large IT departments, followed by nearly a decade as an enterprise software consultant.  This was before the days of eBay, Amazon and Google, when commercial enterprise was strictly prohibited on the Internet. In 1995 the US National Science Foundation finally ended the restrictions on commercial traffic, and in 1997 Interprise Software was launched to pursue Internet enterprise software.  Since that time, Interprise Software has been awarded more than a dozen government research grants and has provided enterprise-class functionality to nearly 100 customers over the Internet, or through “the cloud”.  Today, Interprise Software provides supply chain automation solutions exclusively for buying groups, franchises, cooperatives and other group purchasing organizations. To learn how enterprise software can help your franchise system improve efficiency, reduce costs and increase revenue, visit www.interprisesoftware.com.

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