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Advice and Information for Finance Professionals

The Tyranny of Best of Breed – Part 1

Steve Cox
GROUP VICE-PRESIDENT, CLOUD BUSINESS GROUP, ORACLE

To misquote Mandy Rice-Davies, “Well, he would say that, wouldn’t he?” I’m not claiming to be unbiased on this matter. But I want to question the logic behind a best-of-breed strategy for IT and suggest it has some inherent flaws in it as a technology strategy.

The Landscape

In 2018, SMBs were using an average of 124 SaaS applications. (Numbers vary according to different sources, but most estimates fall somewhere around this average.) In the enterprise space, that number is multiplied exponentially. Add in legacy on-premises software still in use, and you get an idea of the hairball that might pass as  a hybrid environment. And along every strand of hair, data is moving. Lots of it.

In fact, the average company’s data volume is growing 2x per year. And if a company has invested in the Internet of Things (IoT), it’s not 2x but 50x. Let’s do some math: if you’re not yet investing in IoT, and your data volume was 10 terabytes last year, it’ll be 20 Tb this year, 40 next year, and so on. If you have gone the IoT route, then it’s 500 Tb this year, 25,000 Tb the next.

How did we get here?

Here’s how an IT hairball grows: the business needs technology that does ‘X.’ The existing IT infrastructure does not do ‘X’, and it’s not on any of the vendors’ roadmaps. So, either the business or the IT function goes out and buys it. And because SaaS is now the default decision, the new SaaS solution and provider who’s “the best” at X is added to the infrastructure.

Just to compound this, one of the hot topics in my discussions with CFOs in 2019? Data quality and data ownership. Lots of data, of varying quality, with multiple definitions of the same thing and multiple claims of ownership.

You see where I’m going with this? All that data, going through all that hair across hundreds of software applications, with varying update schedules. This isn’t so much an architecture, as a ruin waiting to happen.

Design-the-Spine

Instead of a reactive, best-of-breed approach, why not enable the business with a forward-looking, “design-the-spine” strategy? The spine consists of 4 core business functions—finance, human resources, supply chain and customer experience—plus an integration and collaboration layer: the glue that holds everything together. All of this needs to be SaaS and designed both to work together and for continuous innovation through frequent vendor-driven updates.

In Part 2

We’ll explore the unfortunate cost of best-of-breed.

Steve Cox is the author of a new ebook, Modern Best Practice, Predicted. Read the introductory chapter here.

 

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