Business Week:  Economic Downturn Spurs Interest in Open Source Software

by Bill Harrison on December 1, 2008

Business Week magazine published an interesting article this week entitled "Cost-Conscious Companies Turn to Open-Source Software." The premise of the article is that in hard economic times, like those we are currently facing, companies should focus on technologies like open source software for cost savings. But there are many other reasons that open source makes sense, regardless of economic circumstances.

I'll admit that when W-Systems started its consulting practice in CRM a few years ago, I wasn't a big advocate of open source software. I found that most open source projects were riddled with bugs, the software was difficult to use, and support was at times impossible to obtain. But so much has changed in the last few years. Poorly executed open source projects have died, and the really good projects have thrived and gone on to become blockbusters, spawning entire consulting, customization, and support industries. SugarCRM is one such open source project, and working with Sugar for the last few years has changed my view of open source.

In the Business Week article, Rachael King describes another advantage of open source for large enterprises — supplier diversity. She writes:

"Japan's Shinsei Bank began using open source about four years ago. Working with Red Hat and other vendors, Shinsei later expanded its use of the software, replacing some of its infrastructure components. Along the way, Michael Tiemann, a founder of Red Hat, introduced Shinsei to the folks at SugarCRM and other open source projects. In the interest of maintaining a diversity of suppliers, Shinsei now uses SugarCRM for certain customer service tasks and MySQL open-source database management software running on low-cost Intel (INTC) servers. "

There is no doubt that open source software can offer huge cost savings. But when you look a little deeper, you'll find many other advantages:

  • Vendor independence- You aren't locked-in to a single vendor's solution.
  • Ease of customization- Industry standard tools and techniques make customization faster and more economical.
  • Better support - The community-based support module of most open source projects, combined with commercial support providers, yields the best of both worlds.

We have seen first-hand how many customers go through a transformation as they adopt an open source CRM system. It’s the cost-savings that initially attracts them to open source, but it’s the ease of customization and support that keeps them on open source.

And that makes good business sense in good times as well as bad.

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Bill Harrison
VP of Products and Technology at W-Systems
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