End user developed applications: good or bad?

It continues to be common that some business processes, including supply chain management, are supported by “user” developed applications that are outside of the formal systems supported by the Information Technology (IT) organization.  These user developed applications are created generally by technically savvy users within the supply chain management business function. They sometimes are created by a group within the supply chain management organization that is responsible for reporting or metrics calculations. These applications go beyond reporting and actually augment or replace functionality contained in the formal MRP/ERP system and are normally created using something like Microsoft Access, or probably more common is the use of Excel spreadsheets. They are normally hosted on shared drives, work group folders, internal web-sites or simply emailed around.  Some of these applications can evolve to be considered mission critical by the supply chain. Generally, IT organizations aggressively discourage this approach of groups within the business that are outside of IT creating applications. There are significant drawbacks with this type of approach:

1. The support, reliability, and scalability are dubious
2. Data is outside the formal IT managed systems
3. Incorrect or outdated versions can be used – to name just a few drawbacks

IT may be unaware of these user applications until they break and the business comes to them for help. The systems in which companies run their businesses on, need to be robust and reliable, requiring careful management and support to ensure accuracy and continuity. Why within our current state of maturity with technology and expensive ERP systems, do these offline systems and processes continue to exist? I think there are several key reasons why supply chain applications created by users commonly exist:

• The supply chain organization wants (needs) to be agile, to continuously improve and adapt processes to changing requirements and situations.
• Business users understand their requirements more deeply and coherently then IT business analysts, and when a few develop the required technical skills, they can create applications that fit their needs more closely than IT.
• The modern, mature IT organization is structured and formal and will implement sound and robust improvements to systems, but in many cases at a pace slower (and more expensive) than the supply chain expectations.

In the spirit of continuous improvement or because of changing priorities and requirements, new and modified processes or techniques are required by the supply chain organization. Implementing these new supply chain processes in most cases requires the support of IT to make modifications or changes in configuration to the formal MRP system. Generally, in larger organizations, changing the MRP system requires a formal process that includes advanced planning and competition with a lot of other projects and demands that are placed on the IT organization.  For what seems to be straight forward supply chain process changes, it can take several or even many months to get the projects chartered and then actually executed, where the requirements and priorities may have actually changed in the mean time.  It is therefore somewhat frustrating to the supply chain professionals and the result is the use of spreadsheets or other means to implement processes outside of the formal MRP system. If you are in the “business” - a.k.a. the supply chain organization - you may think these applications are great; they are flexible, quickly modified, and they tend to support very closely the intended functionality. If you are in IT, these applications are inherently bad as they are not formally controlled and supported. It seems that there needs to be a middle ground where the platform is reliable and stable, the data has integrity and ties to the formal systems, but the functionality can be quickly adjusted to new processes and priorities. There are some systems are available and in wide use within industry that support this middle ground - some data warehousing solutions come close but generally lack the deep analytics associated with planning and supply chain execution and management. A step beyond are the advanced planning and response management systems that do contain the supply chain centric analytics and also allow the users to configure and develop reporting and more complex solutions. I feel that to be an agile supply chain organization, and maybe to develop some tactical or even strategic advantage, the extension of supply chain applications needs to be supported by a platform where:

1. The system is managed and maintained by IT to ensure continuity and scalability.
2. The system is central and has accurate, consistent, and timely data
3. Supply chain professionals who have the fundamental and clear understanding of the business requirements are in control of configuring the applications and reporting

I would be interested to know if you have any similar perspectives on end user developed applications and also if your organization has dealt with this in some way?