THIS IS A TEST INSTANCE. ALL YOUR CHANGES WILL BE LOST!!!!
Written By: David E. Jones, jonesde@ofbiz.org
Last Updated: March 13, 2002
1. The Nature of the Opportunity
The OFBiz Project is part of a new trend in enterprise software that will change the nature of businesses and departments that create, maintain, use, and customize enterprise software. The Open Source Software (OSS) movement is changing organization and compensation patterns of software development for many types of software. Early on the primary focus of open source software was on infrastructure software such as operating systems like Linux or web servers like Apache.
These open source efforts have challenged the traditional commercial players in the markets they compete in and many customers are choosing open source options over the commercial alternatives because of the benefits often found in the resulting software. While it is true that one of the benefits is usually lower licensing costs (although sometimes that is offset by packaging costs), the true benefit to customers and end users is an opportunity to participate in a community that is working together so that all can benefit from the shared resources applied to the development of functionality that everyone in the community needs. The result is that customers and end users will have what they need to build the features that they need for their specific business or industry, namely a source code base to work from and more available resources.
As time moves on the focus of Open Source Software efforts is expanding. No longer is it limited to low level infrastructure technology. Efforts are appearing that are targeting higher level needs of enterprises. These include J2EE implementations (Tomcat, Jetty, JBoss, Exolab), reporting tools (Jasper Reports, DataVision), and even eCommerce, ERP and CRM projects (GNUE, Compiere, OFBiz).
Higher level enterprise software such as eCommerce, ERP and CRM software will represent a major change in the way open source software is created and used. At the moment enterprises continually have a difficult decision between building and buying. A third option is becoming viable for more and more organizations. This is the Open Source Software option.
With a closed source package 80% of the functionality an organization needs is often included and then the organization spends 2-10 times as much money as the acquisition cost of the package (or more) adding the remaining 20%. Sometimes certain functionality cannot be added for a reasonable amount of money because of the way the package was implemented.
With an open source package the upfront costs may include packaging and other costs or may include only the cost of downloading the software. This leaves a larger budget for customization which will also be cheaper because the original package is open source, and in the case of OFBiz, meant to be customized. Hundreds of people will have provided feedback to the community about customization making it easier and cheaper to perform the needed changes.
The goal of the OFBiz Project is to provide a framework on which enterprise applications can be easily built and to use that framework to build high quality best practices enterprise applications that can be easily customized as needed by those who adopt and use the software.
To accomplish this goal many resources will be needed to develop the framework and the applications. Also, to ensure that the features of the applications are adequate and that the quality of the software is good there is a major need for adoption of the project by end user "customers" and by software firms that provide services related to the project.
The benefits of being involved for end users or "customers" are described above and apply for the applications and functionality that already exists in the project. This group can also benefit from collaborating with others who are interested in similar features to share the costs of developing those features as part of the open source project.
For services organizations the benefits are somewhat different. They are related to the benefits of their clients because as end users of the project their clients will appreciate the benefits mentioned above. This will make it easier for the services company to compete with other services companies who are customizing closed source software or who are building software on an ad-hoc basis for their clients.
Services organizations that get involved early with OFBiz will have to assume some additional risk because much of the software planned for in OFBiz has not yet been written. These organizations will also enjoy additional rewards because their early involvement and experience with the software, giving them an advantage over other organizations who are just getting started with the technology.
2. Effective Management of Risk
The greatest risks of the OFBiz Project are related to the development of the software to the point where it will be useful to end user organizations. The cost of software development is generally very high, but that is not usually the reason that projects fail. The unpredictable nature of software development and the establishment of business processes can sometimes cause the cost of implementation to go beyond the resources available, or the resources that can be found by even the most creative means when the planned for resources are exhausted.
Ensuring the success of the project by effectively managing the risks is being done by producing the software in such a way that no one owns it and can shut it down or restrict its use, and by keeping the development effort completely free of any investment burden. This allows the project to progress unhindered and even if it must slow down at times because those involved start to get hungry, as soon as additional interest in the project can be found along with available resources the project continues again.
In other words, the software is developed purely from contributions by those who wish to use the software. Those contributions are just that, unburdened contributions that cannot be withdrawn and that allow the project to progress without the fear of falling back for economic reasons.
The involvement of organizations that stand to profit from the use of the software is necessary and finding organizations that are willing to contribute to that end has been successful so far. The future goal of the project is to attract more contributing organizations so that the effort can move along more quickly.
3. Management's Ability to Carry Out Goals of the Project
The original founders of OFBiz, David E. Jones and Andrew Zeneski, are software engineers and architects. They have experience with business software, but additional expertise in a number of fields such as accounting, procurement, sales, marketing, and so forth will be necessary to produce the best practices applications that are part of the goals of the OFBiz Project. Additional skills may also be needed in coordinating and assuring the quality of the effort.
These additional skills will be found through collaboration with end user and services organizations, or through the contributions of people with such skills who for whatever reason desire to contribute to the open source effort.
4. Strategic Relationships that will Foster the Goals of the Project
Strategic relationships with the OFB Group and the OFBiz Project are a vital part of continued success of the project. The goals of OFBiz can only be effectively achieved by working with those who are using the project in their day-to-day business activities.
These strategic relationships may exist in one of a number of different forms. The relationship may include OFB Group Certification as an Affiliated Services Organization, and inclusion in the list of Certified Affiliates on the ofbgroup.com website. This is the sole purpose of the OFB Group which is run by those who are running the OFBiz Project.
The relationship may also include paying developers and organizers to push forward the goals of OFBiz. While there is a need for salaried developers to work on OFBiz, the founders desire to work only as consultants so that their coordinating role in OFBiz will not be compromised by the goals and priorities of one of the many adopters of and contributors to OFBiz.
5. The Project's Market Niche or Basis of Competition in the Market
The OFBiz Project competes and collaborates with other providers of enterprise software, both open and closed source providers. Where competition exists OFBiz hopes to be the best choice by providing an enterprise software framework and enterprise applications that are the most flexible, customization, complete, and easy to use available.
6. The Project's Exit Strategy or Equity Appreciation Strategy
The goal of the OFBiz Project is to develop high quality open source enterprise software. The project itself does not exist to seek profit, but it does exist to assist those who adopt it or use it more efficiently seek profit. This includes end user organizations and services organizations.
Equity appreciation in the case of the OFBiz Project is a simple matter of improving the software such that it more effectively enables the users and adopters of the software to profit in their businesses. This includes but is by no means limited to the reduction of the costs associated with procuring and customizing the software that enables them to run their business more effectively.
7. Strategies to Resolve Limited Resources
The resolution of limited resources will be accomplished by fostering the collaboration of various end users and services organizations to accomplish the goals of the project. These end users and services organizations will be able to afford committing additional resources to the development of OFBiz because of the efficiency improvements made possible by the software and the cost savings over the alternatives.
8. Corresponding Risks of Principals and Investors
The risks of the principals, in this case the founders of OFBiz, and the investors, in this case those who adopt or sponsor OFBiz, are very similar. Both hope to acquire software to use that will fill their needs as inexpensively as possible. Both risk the failure of the implementation of the software in spite of the resources contributed to it.