The problem is who gets to decide what is "core" to your business?
Look at airlines, once the McKinsey types were let loose it turned out none of the stuff we think is core is needed at an airline; no need for in-house staff, catering, baggage handling, check-in, maintenance or even [owning] any actual aircraft. So much easier to operate without all that stuff to look after!
Taken to the extreme presuambly one would end up with nothing but an airline's name and trademarks, a handful of overpaid management types, and maybe a bunch of lawyers to look after all the outsourcing/subcontracting and licencing deals.
But only if there are someone who can and would provide you with all that stuff.
> Taken to the extreme presuambly one would end up with nothing but
This is the premise of 'The 4-hour Workweek'. It was a quite entertaining read.
Except there are many businesses that have and are doing very nicely precisely because they ignored what would labeled as non-core activity by many. Take Apple for example, where would it be if it had stuck to making Macs? Or more recently spent billions moving to their own chips. What about Amazon?
Truth is more subtle. And with SAP, it's easy to understand both why businesses buy it - and at the same time - why most competent software developers believe if they were given the same investment they could do better.
It's like when Mercedes/BMW et al started making SUVs after years of making sedans and coupés. It's a different form factor, but still the same basic product.
It may work using an open source model. However you don't really want to invest into non-core business(es). It takes away money, talent and energy that you would better put into doing what you do best.
I've experienced this first hand developing an invoice system(not my core business). I still use it but if I were to do it again I would develop only the functionality that I was missing in the commercial offering and try an integration. Time spent on the none core business is time wasted.