Monday, May 23, 2011

Would you pay more for quality software ?

In a class of MBA students the discussion around quality frameworks veered towards ERP class systems and the large amounts of effort it takes to keep them running. The number of patches released frequently as well as the overall administration keeps everyone busy and on their toes. Bug fixes, functionality enhancements, and then some more bug fixes are the norm. Comparatively the in-house or bespoke systems are relatively stable and the effort investment is around incremental functionality.

Is it because the development of custom solutions is carried out by IT companies with multiple quality certifications like CMMi and others; or just that the big software vendors providing so called “off-the-shelf” solutions are struggling with factories of programmers that churn code trying to keep the innovation wheel running just to stay in the game. The resultant code is often bug ridden with usability that requires a PhD and a large team to keep it from falling apart.

Despite paying anything between 15-30% of the initial acquisition cost and spending a bomb on implementation with process consultants attempting to fit business to solution to business, it is indeed a wonder that quality remains firmly in the backseat. The story is no different across the industry which has started believing that it is their birth right to charge customers exorbitantly as Annual Maintenance Charges so that they can forever keep on downloading patches; they also get to call a helpdesk which will in most cases not solve the problem which to begin with should not have been there. The twist in the story is that now AMC is also indexed to inflation which provides a creeping increase every year with no improvement in the service level.

Why is it that none of the big software vendors ever talk about quality certifications or Six Sigma levels of defects ? Do they not believe in churning out quality solutions that will be the biggest differentiator for the customer rather than esoteric functionality that is rarely used; consider the fact that almost every enterprise uses between 5-50% of the functionality, I am sure that customers would gladly shift to solutions which are stable, work as designed and provide updates to functionality collaboratively.

There have been efforts from various CIO and industry groups to rein in the runaway costs of maintaining business as usual of which a large chunk goes towards the AMC and teams managing the big solutions. User Groups have failed to make a dent in the ever increasing charges; it does not matter how big or small you are, neither does it matter if the solution does not work as promised, you got to pay else support will be withdrawn and reinstatement of support is very expensive.

I wonder how many customers will pay AMC if the solution worked perfectly out of the box and did not have any bugs or required patches. Maybe this is a ploy to create solutions that fail on quality tests so that vendors can charge you to just make the system work; after all it is a very large chunk of revenue for these companies. An interesting thought thus emerges, would the CIO pay more if s/he was assured that the software does not require any patches, bug fixes or support ? I definitely would !

1 comment:

  1. S C Thakur12:42 PM

    Hi Arun,
    Agree- 22% is too high a price of AMC as quoted by a leading ERP vendor and it really pinches their customers' pocket( atleast for us). Besides bug fix, the AMC is also supposed to ensure that corporates can implement the latest version of ERP, as and when it is released. But new version upgrade in ERP is as good a new implementation, and people rarely do it within a 5 year cycle, and by that time one pays more than 100% of original license cost. From ERP vendors' view point AMC is a assured cash flow and hence the market leaders are going to milk their customers unless there is more competition !!!