Best of Breed vs. Integration: What is Your Comfort Level?

As a finance officer, you may be faced with the tough choice of replacing your financial accounting system. This decision will be followed by another tough assessment on whether to replace the system with a “best of breed” or an “integrated” one. Your prior solution may have lasted twenty years. Your next solution may last twenty more. Which path do you follow?

A “best of breed” solution consists of multiple systems strung together to meet a need. A typical example is an organization using one software package for financial accounting; another for human resources and payroll; and another for purchasing. The range of systems may vary from a couple of systems to a multitude of systems.

Contrast the “best of breed” system with an integrated solution. Using the example above, financial accounting, human resources and payroll, and purchasing are delivered via a single software package in an integrated solution.

As one might guess, there are risks and benefits inherent to either type of solution. Organizations that choose the “best of breed” approach usually base their decision on the notion that they will reduce the risk of becoming too dependent on a single vendor. This, in their view, is a potential single point of failure. On the other hand, organizations that choose “integrated” solutions consider it more of a risk that they are unable to hold a single vendor accountable for potential issues. In other words, they desire, “one throat to choke.” Using either argument is the wrong way to identify the right solution.

Consider the capability of your organization. Does your organization have a strong governance structure? An integrated solution is a shared solution and requires coordinated decisions for configuration and maintenance. Does your technology support organization have the capability and resources to coordinate system integration? A “best of breed” approach requires coordination of technology implementations, maintenance, and integration management. What are the needs of the business community? Are users comfortable with more autonomy (i.e., “best of breed”) or do they desire easier single points of access to data (i.e., integrated approach)?

Making the decision to choose a “best of breed” solution or an “integrated” solution based upon the distance the organization is from vendors is the wrong approach to selecting the right type of solution. Forming an opinion based upon business needs, technical resources and organizational capacity is the smarter way.

Business Intelligence – Wherefore Art Thou?

by Dave Melbye

ERP systems have an interesting character flaw. They are very, very good at generating and storing data (just ask your IT director how his or her storage needs have changed since your ERP system went live), and not very good at all at producing information. To be fair, the same could be said of CRM, GIS, or EAM systems, but let’s pick on ERP for the time being because its more widely deployed than just about any other enterprise-class technology.

Fact: Most governments overestimate the ability of managers and others to write their own queries or generate their own reports.

Fact: Very few of the analysts and decision-makers in any given organization truly understands how data is organized, exactly where it is stored, or how to get at it.

Fact: Depending on who you talk to, you will get different answers when you ask what a certain data element actually represents.

The problem, in a nutshell, is how to generate value from all that data that your ERP system is happily generating.

Software vendors, no slouches in this area, have data warehousing and business intelligence (BI) tools that purport to solve this problem. Condensing vast amounts of data into intelligible pools of information, they also have colorful dashboards and other tools to help you focus on key indicators and measures for your organization. In other words, they can help make your multi-million dollar investment that much more valuable.

And yet….we see few governments using BI tools. We are told that they are too difficult to understand, too expensive, too technically complex. They require more resources than are available for support. One IT director told me that BI would never work at his government because “it would force us to know something about our data”.

BI tools can turn your ERP system from a great big transaction processor into a valuable decision support system. There is a business case to BI that transcends cost and complexity. If you skipped BI, go back and take a look. If you’re still early in the shopping process, add it to your requirements.

2010 GFOA Conference Technology Sessions are Awesome

The 2010 GFOA Conference is almost here. Looking forward to some of this years technology sessions, including:

Saving Money through Technology Sharing

The idea of shared services is hardly new. In today’s financial times, standard operating procedure for service delivery has changed. Governments are looking to shared services and collaboration for savings. What technology tools are required to implement and maintain a shared services approach and how have technology sharing deals worked out? This session will discuss the latest trends and strategies regarding collaboration will take a candid look at costs, benefits, and lessons learned.

Cut Costs through IT Planning
Good IT planning can save money by targeting IT investments to the right areas. This session will provide specific strategies for building a business-driven IT strategic plan that produces a solid return on your government’s IT investments. Hear from governments that have prepared effective IT plans.

Using the Internet to be More Efficient
Governments are increasingly using the Internet as an information portal and a revenue collection engine. Cloud computing is becoming a cost-effective way of providing technology services. This session will identify valuable Internet-driven technologies for government and provide examples of how governments have used the Internet practically, economically, and securely.

Outsourcing IT: Addressing Risks and Cutting Costs
Outsourcing IT can help an agency focus its attention on improving core business functions and also save money. This session will give attendees information on how to analyze outsourcing options to assure that key issues — costs, security, and service levels — are satisfactorily addressed. Speakers will provide lessons learned from their own experience.

Using IT to Do More with Less: Leveraging Existing Technology
Innovation in government is a challenge in the best of times. It is even more difficult in the face of dwindling financial resources. Governments are looking for creative ways to get more out of their existing technology. How can you optimize the technology you already own? Can you leverage your current infrastructure to promote greater innovation and efficiency? This session will explore these questions, provide lessons learned, and suggest tools and techniques to foster innovation in these tough times based on GFOA’s organizational assessment consulting and research.

Achieving Transparency through Technology
Transparency means providing information to the public that is accessible and understandable. The guiding principle is that information and digital records, including various forms of electronic communications, are public information unless there is a compelling reason to keep them private. Come to this discussion prepared with your questions about ways to make your government’s information and processes transparent, and also to share your success stories with peers. Technical experts will be on hand to discuss best practices.

Specific session outlines are now available on the GFOA website. And be sure to follow GFOA Consulting on Twitter as staff tweet about session highlights.