Cost of ownership as a term is often bandied around. It is an investment appraisal method used for purchasing software. It works by taking the focus off the initial purchase cost of the software and implementation and makes people consider the cost of owning it for its useful life.
I believe that the cost part is not the real issue for businesses wishing to implement a new business system. It is the ownership that is the key element.
Cost of ownership is not just a cost proposition. It is the ease and degree to which the company can use and own the system.
Why should I own it?
I believe ownership is the absolute number one priority for a business. This is a real problem in software implementations. It always seems easier to end users than it ends up being in reality. Once implemented, changes become too difficult and you end up accepting the limitations of the system. You either start using workarounds or stop using the system as designed all together.
For example, say a report is not quite right, you ring up your service company, find a date you are both available and make the change. The barrier to doing this is too high. So you just live with it.
What is the problem with CPM/BI/budgeting systems today?
The issue in the CPM/BI/Budgeting & Forecasting market is that solutions tend to be a conglomeration of different products and technologies cobbled together. This makes it a more specialist task to build the system. So you need highly paid and difficult to get hold of consultants. These systems need a combination of different specialist technical disciplines to implement the system such as business analysts, developers and IT experts.
The consequence of all this is that the value of the implemented system actually depreciates. Your initial ROI for the system is not what was expected. I see the ongoing usability of the system as being the number one issue for businesses. Most software companies pay lip service to this but know that, in reality, the company will not be able to own the system.
What is product flexibility?
So how do you go about ensuring that you get a system that will be a satisfying experience for your users over the long term?
First and foremost is to shift the emphasis in your decision making to product flexibility as the number one driver.
With flexibility, you can change the configuration without affecting the whole build. Generally, configured systems are more flexible. Configured means you do not need to customise. You are using the product’s toolsets rather than reverting to specialised coding to achieve your ends.
How do you prove system flexibility?
I suggest you choose a budgeting/CPM product which can demonstrably be owned. Does it use a single interface for all system admin and report changes? Can I use drag and drop techniques to build the system, to create reports and then instantly deploy without leaving the same screen?
Can this be demonstrated to me? Can I extend the functionality of the system, say, from budgeting to reporting to KPIs and dashboards to strategy tools, using the same interface and building blocks?
For me the best way to achieve this is using a toolkit to build the application. A toolkit, as the name suggests, makes building the application easier. You don’t need to understand coding. A business consultant will be able to do the design and build without need for a technical resource.
This goes further than just being good for the developer though. The simple approach means it is easier for the user and hence easier to adopt and own.
So look out for cost of ownership. It could cost you much more than you think.
You can read more about Professional Advantage and budgeting and forecasting here.