A comprehensive solution or "best-of-breed" software? It depends...
Organisations often ask us about about application strategies. For example, is it smarter to choose a comprehensive solution from one supplier, or to integrate several specialised solutions from different suppliers? The latter approach is known as a "best-of-breed" strategy. Unfortunately, there is no simple answer to this question – the best approach depends on the circumstances and the specific demands of the organisation in question.
There are significant advantages to be gained by choosing a comprehensive solution from one supplier, but it is also important to consider whether it will continue to meet your needs into the future. With Hypergene, for example, you can start with just one module and add more as your needs change. What's more, every Hypergene component compares favourably with competing specialist products.
However, there are many aspects to consider when choosing between comprehensive and best-of-breed solutions.
To start with, an organisation may already have invested in specific operational management solutions, and may have an ongoing agreement that runs for several years. The organisation may have put hundreds if not thousands of hours into implementing goal and quality management systems based on these solutions
If so, it is probably more relevant to focus on other related improvement areas rather than replacing the existing solution. For example, it might be possible to implement more agile and proactive budget and forecasting processes, or better and more relevant decision support.
In this scenario, it is important to find solutions that can integrate seamlessly with the existing solution in a streamlined manner. Many of our customers, for example, have successfully complemented existing solutions with Hypergene components.
Another common scenario is where an organisation has invested in BI business intelligence (BI) solutions such as Power BI, Tableau or Qlik. In such cases, we often implement self-service tools for specialist users such as controllers, or specialist solutions for specific needs such as sales analysis, customer analysis or management dashboards.
Again, it is relevant to focus on other improvement areas, which could include anything from streamlined strategic and financial planning to improved role-based decision support for a broader spectrum of users.
Hypergene is an example of a solution that can complement most existing BI solutions.
In the examples above, solutions are already in place and there is a wish to further develop them. Other scenarios, however, might be necessary a deliberate choice of future applications strategy.
A theoretical advantage of best-of-breed solutions is the potential for greater flexibility when one system or solution component is replaced by another. It is also possible choose the solution you prefer within in each function or process area, instead of limiting yourself to the systems, modules and components included in the overall solution.
Some system integrators or consulting partners can put together a best-of-breed solution for you, with simple standardised integration between the components.
As mentioned previously, there are obvious advantages to a more comprehensive software solution from a system supplier that develops a solution platform with fully integrated components or modules from the outset. The system supplier guarantees that the entire system works. System administrators need only manage the solution, and end-users just have to learn the user interface to benefit from a consistent experience.
And as the examples above show, with the right comprehensive supplier, you do not even have to select the entire software solution at the start. Instead, you can complement your existing mix of products with a specific component and still have the opportunity to further develop the solution at your own pace in future phases.
Clearly, there are advantages and disadvantages to both approaches, and we will now look at some important considerations when choosing the best way forward. Ultimately, each organisation must weigh the arguments according to its own unique requirements.
Needs change - but many organisations are still using decision support systems that were designed for a different set of requirements than the current ones.
The organisation may have outgrown a part of the system support. Or other internal and external factors (new business models, processes or sector technology) may have resulted in different operational needs.
In such situations, you can either undertake a major review of the operational needs and set up an ambitious plan to implement new system support as quickly as possible, or you can choose to work iteratively and focus on the most critical support system first.
In the latter case, it is important that a comprehensive solution can be implemented gradually and at a pace set by the organisation. Initially, new software needs to interact with several existing systems. But over time, you may want to replace existing elements with components from the new solution.
2. Modern agile solution architecture
Analysts and experts today agree that smart, future-proof solutions should be modular, agile and preferably container- or microservice-based. Organisations work with various types of support systems and, depending on the type of solution we are discussing, there are different ways of looking at questions concerning application lifecycles, changes in speed and agility.
The platform of the business application strategy normally consists of the systems that manage the organisation’s financial and business processes. In other words, it's a transaction-based system, such as ERP/business, and a sector-specific support system.
These systems are usually highly integrated with the operation’s processes. They are difficult to replace quickly, and are often central from a master-data perspective. However, it is critical that these systems can interact efficiently and flexibly with all the other systems, both internal and external (new and changed systems, data sources, web services and microservices), including agile, flexible support systems such as decision support, planning and master-data handling). This applies irrespective of whether the basic strategy is a comprehensive solution or a best-of-breed approach.
3. Integration technology is not usually the greatest challenge
Today's solutions increasingly offer more and more standardised integration; everything from standard format to cloud-based standard technology, such as REST and Open Data Protocal (OData). Even if, for example, you still work with the more traditional fibre-based integration, without having a sophisticated integration platform in place, the technology is not the biggest integration issue. Rather, the key challenges are likely to be issues relating to master-data management and data modelling, validation and business/process logics.
With best-of-breed solutions involving several systems, it is often necessary to spend more time on analysis and work to secure good data, master-data models and efficient workflows over system boundaries.
If, on the other hand, you have chosen a comprehensive solution, the solution supplier will have designed solutions to address this. However, this does not mean that you can completely eliminate time spent on analysing and working with these questions. Even a comprehensive solution has integration points and interacts with other systems and data sources.
4. Authorisation management can be a challenge
Authorisation management has several dimensions. User roles and user profiles often control which functions, workflows, etc. the user has access to. This is often combined with other forms of responsibility so that, for example, a dynamic screen can show "my colleagues" or "my approvals" without the user needing to make an active choice.
In addition to controlling access to data linked to roles and responsibilities, authorisation may also need to be defined based on other criteria.
In theory, a best-of-breed approach can work with integrated access control – for example, based on Active Directory groups. In practice, however, different systems have their own logic and structure when it comes to authorisation management. This means that all or parts of an authorisation management system must still be configured and maintained on a system by system basis.
Authorisation management in the ERP/business system must often reflect the authorisation management in a goal management tool, planning tool or decision-support tool. When a new employee starts, when work tasks change, or when someone leaves the organisation, the details must be recorded in every system. This can be a complex, time-consuming business with high risk for errors, since authorisation logics differ between systems.
5) How are GDPR issues handled?
In recent years, many organisations have worked intensively on compliance with the EU General Data Protection Regulation (GDPR). Each operational system must be analysed and managed from different GDPR perspectives, such as "the right to be forgotten”. Often, there are no solutions in place which can handle these issues in several different systems.
Deletion and anonymisation of data must be possible in every single system, and we must ensure that integrations do not reverse the work done to delete or anonymise data. As with authorisation management, the more systems an organisation uses, the more work and analysis must be done.
6) One or more supplier relationships?
Best-of-breed solutions naturally mean more supplier relationships. Even though you will primarily work with a systems integrator with a number of systems in its solutions portfolio, you will still have indirect supplier relationships with the system integrator’s partners.
This need not be a problem, but you could be affected by agreements and conditions with a number of different suppliers. If a problem arises during implementation or management, it is important that the responsibilities between the various suppliers are clearly defined.
This includes questions such as backup management and disaster recovery when data is located in separate but integrated systems. You must check the interdependency between the different solutions and suppliers on a continuous basis and when upgrades are implemented. You must know how to deal with changes in the agreement and licensing conditions when a number of suppliers are involved.
A comprehensive solution involves fewer supplier relationships. However, it could be more difficult to replace your system integrator or consulting partner, for example, and you are generally more "locked in" to your solution. But bear in mind that it may also be difficult to replace a module or solution component in a best-of-breed solution.
7) Supplier competence and specialisation
If you choose a solution directly from a system supplier, you can be confident of getting access to highly qualified consultants, with in-depth knowledge of the system supplier’s solutions. You also know that consultants and customer support professionals have direct access to the system supplier's product team, development team and other experts within the company.
Furthermore, you know that the focus and the sector-specific solution offered comes directly from the system supplier. As stated earlier, when working with a system integrator or consultant, for example, you have the possibility to replace them if you are not satisfied with the collaboration or delivery.
On the other hand, the distance to consultants and customer support professionals may be greater. This means they may not be able to keep themselves up to date with new system versions.
It may also be the case that the chosen system integrator/consulting partner has a focus on a particular sector, or has developed a solution on top of the system supplier’s standard product. In these scenarios, you will not get the same advantages of the system supplier’s development of the standard product. Rather, you will be dependent on the expertise of a number of key people as well as customer-specific and customer-financed development.
8) What is the supplier's business model?
When assessing the total cost of a new solution, it's often easier to calculate the cost of a comprehensive solution from a system supplier. Tech companies and system suppliers are measured and evaluated on the basis of their recurring revenue streams, which means that the main cost element for the customer is usually the price of the cloud service. Normally, there are no other hidden costs, apart from the implementation costs and various forms of management support (fixed or running). System suppliers do not usually strive to maximise the consultancy business.
When you choose a solution from a systems integrator, they typically have a consultancy-based business model. A system integrator may be willing to offer a relatively slimmed entry deal, but will want to maximise the consulting business over time. This is positive if you are likely to need a lot of help from the consultants, but it becomes much more difficult to assess the total cost for the system's entire lifecycle.
It depends ...
So after having described the various aspects of comprehensive and best-of-breed solutions, we come back to our initial conclusion: "it depends". Each company's circumstances, business environment and needs are different, and both application strategies have their advantages and disadvantages.
Our experience at Hypergene is that the benefits of a comprehensive solution generally outweigh those of a best-of-breed solution. However, many of our customers use Hypergene very successfully in combination with other solutions. If a comprehensive solution has been developed with a focus on the customer needs, it should be able to work in a flexible and agile way with other systems.
All things considered, it is vital that you conduct a thorough analysis in order to make a well-informed choice. If you are thinking of developing your capabilities and your system solutions in planning, reporting and analysis, you are most welcome to contact us.