Application Overload: Excess Software Can Spoil the Budget

Computerworld - Mark Lack, who's in charge of business and financial reporting at Mueller Inc., a manufacturing firm in Ballinger, Texas, is only half-joking when he says the water cooler is his best source of information on what reporting software his company owns.

Lack oversees Mueller’s deployment of Cognos Performance Applications, a suite that’s supposed to be the standard for analysis and reporting for the entire company. But sometimes he finds that competing products are being used instead.

“Someone will say, ‘Hey, did you know this department just bought that package?’ So I go look at it, and it’s not got even the same level of capability ours could provide,” says Lack, manager of planning and financial analysis at Mueller.

“We recently found out that our manufacturing department had bought a piece of reporting software right under our nose,” he says. “They bought what they thought was a great software package without realizing we already had that capability in-house.”

Redundant applications, unused functions in ERP and CRM suites, and just plain old shelfware — applications that were purchased and then forgotten — are common and expensive. Costs related to the excess software add up: There are software license fees, maintenance fees and the cost of the IT labor needed to support the applications. On top of that, there’s a lack of integration and consistency among systems. Eliminating redundant or excess software can go a long way toward freeing up funds in an IT budget.

Sniffing Out Shelfware

There are several ways shelfware can accumulate, says John Schick, a consultant at Compass America Inc., an IT consulting firm in Naperville, Ill. “One way is mergers and acquisitions,” Schick says. “Another is through decentralized purchasing. That’s when one department funds a suite of tools, then another department funds a similar project and buys a second suite that does essentially the same thing.”

In Mueller’s case, lack of interdepartmental communication has been one of the chief causes. Like in many large organizations, departments don’t always coordinate their IT projects.

“We work constantly to communicate what this [Cognos software] can do. But there’s still a lot of duplication of effort with different departments, with different software systems, all trying to achieve the same thing,” says Lack.

Fortunately, there are a number of other ways that IT managers try to keep waste out of their software budgets. Here are some of their best suggestions:



[1] Beware of suite discounts. Software suites often wind up as shelfware, or partial shelfware. Jane Disbrow, an analyst at Gartner Inc., says plenty of CIOs complain that they’re not fully using large enterprise suites, such as multimodule ERP or CRM packages. She estimates that 25% to 30% of the capabilities within enterprise software suites go unused.