Why databases of today cannot support demands of digital transformation
Rapid onslaught of digital technologies and growth in digital communities have prompted IT managers to look beyond traditional ERP frameworks to what is next. Business and enterprise applications have relied on databases to store information and process it for results and inferences. But the architecture of databases used over the last decade have been used with certain limitations.
Most databases have been built to use with specific applications and for specific purposes. In other words, applications and databases are configured to match each other to generate specific results for end users. Change the requirement and the database needs to be configured to match the purpose.
In the present era of digital transformation and business agility, the biggest hurdles remain managing the complex databases and the enormous growth in duplication of data.
Till recently businesses had no option but to wade through large, sprawling, complex and limited database structures, locked to legacy applications that generated predetermined reports and dashboards. Changing the requirements of the management dashboard has meant recreating the database, a long and demanding process.
While the basic core ERP engine still remains, the driver of enterprise transaction processing cannot be ignored. The associated ecosystem of tools and interfaces to engage and access this engine, are in the process of being transformed. Creating and replicating databases to meet new requirements, the significant lead times associated with the process, the limited benefits and gains at the end of it, has led to the emergence of next generation ERP.
While duplication and complexity of database structures are offshoots of traditional inward facing IT investments, the challenges of data deluge are coming from another source. Sensor generated data, data from social media applications, consumer data generated from mobile and other connected devices, are generating volumes of unstructured data.
For any business, the external unstructured data needs to be linked to internal structured databases to be brought into context and generate business friendly conclusions. Many of the open source datawarehouses are limited in their ability to integrate with internal databases.
IT managers are now faced with answering two fundamental questions. How can they leverage previous investments in ERP systems while meeting the requirements of business managers faced with digital transformation? How can they rapidly integrate existing ERP systems with newer, more open, agile digital applications?
The transformation process leading to building next generation ERP systems usually involves the following:
- Leveraging the core ERP and extending it to meet new data requirements
- Incorporating new technology enhancements such as open APIs, hybrid cloud, in-memory computing, real time analytics, IoT interfaces
- Bringing in new models of user engagement such as managed services, consortium building, risk-sharing
- Interconnectivity and integration with multiple and growing data sources and data streams through open interfaces
- Migrating to a new architecture that is open to integration, agile in delivery
- Revamping user experience and helping them get visibility into data and actionable intelligence leading to smart decisions
- Realigning with business processes aiding improved decision making, agility, velocity
The most significant aspect of modern ERP solutions is simplification at every level. Other characteristics of modern ERP applications include modularity of solutions, hybrid deployment, extensive interoperability, platform compatibility, open source approach, and flexible architecture.
It has been decades since the first databases were used by enterprises. The IT industry may now be on a fresh and revamped path of win-win relationships with their eco-system of end customers.