IT and Business Insights for SMB Solution Providers

Best of Breed for PSA – Kitchen or Car?

When you need all the component parts working in a seamless, integrated fashion, choose your PSA like you would your car. By Steve Duckworth

BEST OF BREED works best when integration isn’t important.

For example, when equipping a kitchen, experts highly recommend that you buy the best oven, the best knives, and the best cookware possible. They don’t all have to work together, but collectively, they play an important role in preparing a tremendous Sunday dinner. At the very least, if the meal is no good, that’s probably on you.

However, if the individual parts have to work in concert, best of breed doesn’t necessarily lead to the best results. For example, a vehicle built with best-of-breed parts won’t work if the best fuel injector doesn’t fit with the best fuel pump. At that point, all you’re left with is a garage full of quite amazing, and probably very expensive, parts. But try driving a pile of expensive parts to the store to buy your groceries. At least you’d have an excuse to not do any cooking.

Now let’s consider your PSA system. Which approach is best, an integrated solution or best of breed? First, it’s critical to understand that the component parts of a comprehensive PSA system usually include a CRM system, a service desk system, a timesheet system, an expense system, and an accounting system.

Anyone selling a best-of-breed solution will often point to fast implementation (both initial implementation and implementation of upgrades); not being obligated to buy all component parts at once; and the fact that risk is tied to only one aspect of a system and not the whole system.

But here’s what they’re not going to tell you: PSA systems are more car than kitchen. The advantages the best-of-breed proponents cite are not applicable when you need all those component parts working together in a seamless, integrated fashion.

Here’s why:

1. Cost
A best-of-breed system requires many parts. Consider this quick analysis for a 30-person company: A typical best-of-breed systems solution architecture can generate an aggregate per-user cost of $70 to $80 per month (assuming the usual distribution of users by role). That’s more than $25,000 per year—well in excess of prices for integrated software.

2. Management Information
As stated earlier, lining data up between systems is hard work. Data state across multiple systems can never be relied upon, and editing output before analysis is time-consuming, difficult, and ultimately, may be ineffective. Forget real-time profitability; you’re unlikely to get close, even given a day’s head start.

The other major issue with separate timesheet and service desk components is that service staff don’t bother to record time at a ticket level (the granularity needed for this analysis), so no matter how much postprocessing you do, you won’t get a clean number—only ticket statistic-based approximations.

3. Revenue Leakage
Best-of-breed architectures leak revenue all day long. When your service desk doesn’t understand your contracts—who is paying, who has cancelled, etc.—how will they know whether to answer a call or not? The fact is that they probably won’t and so will help anyway. This is work for free and is a remarkably common activity in these companies. Bring all your systems together and this stops.

Revenue leakage also occurs when work you do simply doesn’t get billed. If the process of feeding work through the architecture contains any manual stages—and the vast majority do—any failure can lead to a missed invoice. This means you’re back to working for free. If this has never happened to you, well done! You’re in the minority. Even if you do spot it later, you’ve lost the cash flow and also probably annoyed the customer.

While having the market-leading niche systems may sound like the safe option—the best option, even—taking this approach will be more expensive, lack analysis capability, and probably cause you to miss billing opportunities. It will certainly create a lack of visibility across your business. This is what best-of-breed really means.

In a career that began in offshore engineering, migrated into investment banking, and ended up with the co-founding of a software company 10 years ago, Steve Duckworth, CEO of Harmony PSA, has devoted his career to developing solutions solving project, accounting, and business process problems. Follow him on LinkedIn or @HarmonyPSA.

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