Why Platforms Matter
/When you design your business systems architecture, the balance of buy vs build is important. Are you in the business of creating systems, or the business of leveraging systems built by others? Will you achieve agility by "owning the code" or by choosing the best platform partners?
One of my favourite clients successfully completed a long and arduous journey last year. Like many such journeys, this one was packed with lessons. I’m sharing with you to help you avoid the same challenges.
Several years ago, my client was coming close to outgrowing their core business system. They conducted a search for vendor solutions but couldn't find the perfect system. So the decision was made to build their own system from scratch. Owning the code, the thinking went, would give them complete flexibility on what the system could do for the business.
Here's what actually happened. Without realizing the consequences, they decided they were in the business of creating systems, but did not retool the business to add this core competency.
Three years later, this new system had not been completed.
When a new management focus was applied, I was asked to take a look and provide an opinion on how to complete the implementation. My conclusion was that the need to build the system from the ground up required the team to create too many low value components before they could implement anything resembling the system that the business required. And the search for a perfect system had driven scope creep to run amok.
My advice was to stop development, take another look at the available alternative vendor solutions, and consider moving from build to buy.
We quickly completed a thorough search and found a suitable alternative from a good vendor with solid references ( some unsolicited). The system would provide 90% of my clients “perfect” solution. Three years on, that was good enough for them. Six months later, the new system was up and running.
Don't get me wrong - buy was the right decision for this business, but there are plenty of circumstances where build would be appropriate for other businesses. My point here is not to enter into the system development field lightly. It's complex, risky, and will draw resources from your core business. That's why a build justification requires considerable upside. Not a decision to be made lightly.
Beware the Technology Stack
Business Technology is multi-layered, from the network and hardware, up through the operating systems, database engines, and the applications that sit at the top of the stack. The deeper you delve in to this stack, the more your business's core competencies must lean towards technology. This is a strategic choice.
If you build your own business systems, you take on ownership of modification and maintenance for the life of each system. Sometimes, this is short lived - a lot of web applications fall into this category. But consider that a good business systems investment will carry you through the next five years or more. The total cost of building a system must include the business technology skills and resources required to operate and maintain the system for that time. This is likely to be 3-5x your original build cost.
If you buy and implement systems built by specialist vendors, you're tapping in to a platform strategy. Choose well, and you'll reap the benefits of a mature solution, proven in your domain to provide agility to the other businesses that are customers of your vendor. Of course, a robust implementation will take time, and you'll incur license and support costs. But the risk of implementing the best solution for your business from a proven vendor is much lower than building your own systems from scratch.
Platform Decisions
Platform decisions are fundamental to your success with Business Technology. Answer these questions for yourself to get started:
What kind of agility matters most to your business over the long haul? Can you achieve this with a platform that has proved itself across many other businesses with similar needs to yours?
Does your business operate in industries that are well served by existing platform solutions? Or are you in a small niche, where proven specialist vendors are hare to find?
Does your business operate in multiple industries? Might this necessitate multiple vendor solutions?
What is your competitive secret sauce? What will it take to maintain this recipe if you implement an industry-standard platform that may be used by your competition? If you must build your own solution to capture this value, is there any reason that this could not be an add-on to a core vendor system?
What do the candidate system vendors' references say about the vendors credentials? How has the solution advanced their businesses? Was the implementation experience a good one? Has the vendor provided great support since then? Do they act like partners?
These decisions are complex, but if you send your answers to me at graham@primeFusion.ca, we can get on the phone to discuss your next steps to finding the best answer.
Trusting Technology is a book about forming ideas, exploring opportunities with customers and colleagues, and building your future together. Order you copy here . This articleThis article is also available in hardcopy as part of my 10-minute Reflections series of exercises—order volume 1 here and volume 2 here.