Vendor Reduction, Simple Solutions and Better Cost of Ownership

  • While sounding like the makings of a great dinner and an amazing cocktail, what we are looking at is how vendor sprawl and an attempt to seek out market leaders in niche spaces or to single out best of breed individual solution components can undermine overall goals around TCO (total cost of ownership) - primarily through adding decision making cost and support complexities as well as implementation hurdles.

    In seeking solutions, we have two polar opposite approaches to consider in any cases: strong single vendor integration or heterogeneous piecemeal systems. Both have merits and value; likewise both have challenges and caveats.

    Single vendor solutions are famous for coming from vendors such as IBM, Oracle and Apple historically. These companies have traditionally approached their markets from the perspective of wanting to provide an end to end customer experience that allows the core vendor to control all aspects of the system to allow for extreme levels of predictability, support, testing, integration and performance.

    Working with single vendor solutions has many advantages for the customer. For one thing, there is a single "throat to choke" as the saying goes. There is no question where one needs to turn in case of a problem. A single support vendor is there to handle all aspects of the system and there is no one at whom to point fingers. One vendor with responsibility and capability over all of the different components.

    This single vendor approach naturally provides other benefits such as a lower cost of decision making. Outside of basic capacity planning there are rarely the plethora of choices that will be presented to the "piece together your own" solution approach. Decision making can be a very large cost in businesses and the more research and decisions that need to be made the higher this cost becomes and the more risk that is associated with it. And the cost scales up as we add more vendors, more products and more system interactions. Not only must individual products be selected, but they must be selected in relationship to one another. The number of potential permutations expands rapidly.

    This is not to say that heterogeneous environments and solutions are not without their merits. Using best of breed or carefully selected individual components can benefit through a highly customized solution that is tailor designed for the organization and workload in question. Most customization is possible with this approach.

    When looking at approaches at a high level, smaller organizations will lean towards integrated system and enterprise environments towards niche and custom ones. The cost of decision making is far higher, comparatively, in the SMB because the size of the workloads and solutions in relation to the size of the decision often make the decision cost staggering whereas in the enterprise, the decision cost can often become background noise lost in the immense cost of the solution itself. Enterprises tend to also be far better equipped to make heavily technical support and integration decisions in a way that SMBs rarely are.

    Both approaches have great reasons to be considered, and we simply need to understand what are there benefits and when they tend to make the most sense for us. Single vendor systems often have far better TCOs than are expected due to low internal costs for support and very low decision cost. Time lost choosing, designing, supporting and acquiring support for the system is generally far lower, but these benefits are often hidden ones because they are not line items on an invoice. Custom or non-integrated solutions tend to have lower line items but more hidden costs and risks, especially around support and support acquisition. We need to consider these factors when looking towards solutions of one type or the other.

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