“I don’t care if you can afford to buy and install the initial software licenses, can you afford to run the system?

In my last post, I said that CFOs are asking IT the question in the title of this piece when it comes to enterprise software. The lifetime, total-cost-of-ownership of IT investments can no longer be an afterthought; it has to be a deciding factor when evaluating new technologies. I see this new way of thinking as being a good thing, applying to the world of transactional document management and document-intensive process management solutions. 

Most document management and workflow solutions start as “small” projects intended to solve very specific and tactical business problems at the individual department level. And why not? You reduce the risk of project failure when you tackle problems that are well defined, and the implications of which are well understood by the various stakeholders involved in the process.

Too often, unfortunately, ECM buyers don’t consider the capacity of the document management and workflow solution to do more than address the immediate problem at hand (i.e. a “point solution”). The limits of a point solution become apparent when the organization attempts to extend the system beyond one department and into areas of the organization. 

It’s at this point that the “simplicity” and low, initial price point that so dazzled end-users in one department suddenly becomes the “simplistic” and budget-sapping administrative burden IT needs to deal with moving forward.

Each request to extend the point solution forces IT (or the vendor’s professional services team) to “bend” and custom code the missing capabilities demanded by end-users. Each extension adds complexity to the initial “simple” purchase. Subsequently, each new deployment or upgrade becomes harder and, therefore, takes longer for IT change, test and implement.

By now, the “business” side of the house begins to perceive that IT delays mean that IT doesn’t “get” the urgency of their needs. When that happens, things play out in a couple of different ways, none of which are good.

  1. Operating units become resigned to the fact that they have rigid, underperforming systems and simply give up on going to IT for help. Not exactly a model for organizational agility.
  2. Operating units go around IT and start shopping for their own point solutions. The result? More redundant maintenance contracts, more system administration skill sets for IT to account for and more information silos to eventually connect.

Scenarios like these are what contribute to 70% of enterprise IT budgets being allocated to the administration of existing systems and infrastructure. If this is bad enough for large enterprises, imagine the impact these scenarios can have on mid-market enterprises counting on IT to enable organizational agility and innovation to offset the efficiencies of scale of larger competitors.

There’ll never be one system to do it all but it’s prudent to select a system that is versatile and – dare I use a marketing buzzword – robust enough to do a lot more than one thing right.

Ken Burns

Ken Burns manages the Analyst and Influencer Relations program globally for Hyland, creator of OnBase. He is responsible for keep leading industry analyst firms informed about Hyland’s company and product strategies. He has worked in the ECM industry for nearly 15 years and is a keen observer of the customer and competitive forces shaping the software segment.

1 Response

  1. Kyle Nowlin says:

    Great follow-up post.

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