Data tooling platforms increase efficiency and allow organizations to introduce automation into their business processes. Platforms typically add a user interface, security, and workflow management to tools that would otherwise lack those capabilities. These features make it easier for many different types of users to access and leverage the tools. Below are some of the traditional routes that organizations follow to obtain a data tooling platform.
Hire and Build
One common route that organizations take is to build the platform themselves in-house. Usually, this involves a combination of hiring full time developers and administrators, contracting consultants, and leveraging open source code. There are some downsides to following this path.
- Time Consumption – This type of project typically requires months to reach a proof of concept stage. Time is spent enumerating initial requirements and establishing an architecture before any code is developed. Development teams often struggle to keep pace with code refactoring, maintenance needs, and new feature requests when organizations grow large and expand their requirements and usage of the platform.
- Resource Churn Impact – Employee turnover is much more expensive for a platform created in-house versus other routes. Specific knowledge about parts of the platform is often held by sole individuals and not documented elsewhere. Losing the individual results in the loss of that knowledge and need to spend time and effort restoring it. This is especially impactful if a critical resource is lost during the initial creation of the platform. The project can be delayed for months while a replacement resource catches up with the work that has been done before they can begin contributing. Losing more than one key resource during this phase can often cause the project to fail altogether.
- Support Cost – In-house built platforms often require the creation of a small team to provide end-user support. The staffing requirements of this team grow as the number of users and complexity of the platform increases. Time is spent by both developers sharing knowledge and support staff learning to provide proper support. This can be complicated immensely if the original creators of the platform were only contracted for a short term or are otherwise unavailable to contribute their knowledge to the support team.
Purchase Enterprise Software or a SaaS Solution
Another common route that organizations take is to adopt a SaaS platform or install an enterprise software product. This path is often long because of the time spent in the evaluation and selection process. Many different solutions may be considered by several departments with different needs and requirements. This can drastically increase the difficulty of reaching a decision that makes everyone happy and willing to invest budget towards. Once a solution is selected and obtained, there are additional downsides to following this path.
- Lock In – SaaS platform companies and enterprise software companies both employ strategies to make it difficult or undesirable for their customers to move away from their solution. For example, Microsoft, Google and Amazon software services all integrate really well with additional offerings from the same company, but not necessarily with other companies’ offerings. Making it so that, the more deeply an organization invests in one company’s cloud software suite, the less likely they will use pieces of another company’s cloud software suite. On the enterprise software side, there are many historic examples of buyer’s remorse when an organization becomes invested in one product and then sees the yearly license fees for that product increase dramatically, as has occurred in the past with Oracle and Microsoft products, among others.
- Lack of Customization – Customization options are often very limited in both SaaS offerings and enterprise software. While some options may exist, they rarely address all of the custom needs that an organization has, forcing the organization to develop additional software layers on top of the purchased solution. This challenge often leads organizations away from the purchased solution route and back towards an in-house created solution.
- Cost Structures – Enterprise software cost is often a barrier for small and medium sized businesses as the entry level price is usually at least five figures and is often six or more for a full solution. SaaS offerings have a much lower initial entry cost, often free for extremely limited usage. But, as usage scales upwards, the cost structure also scales in a way that becomes very expensive. A pay-per-user, pay-per-record or pay-per-transaction model often hamstrings the organization trying to use the service and penalizes them for their growth and success.
These paradigms represent the historic approaches, but a more recent trend is to leverage a community driven app platform as an enterprise level solution. There is still some overlap with a few of the downsides mentioned above, but an app centric approach to a tooling platform unleashes new benefits while minimizing the downside impact. This creates a new compelling paradigm in the industry.
App platforms have free or significantly lower entry and scaling costs compared to enterprise software and SaaS solutions. Implementation time and effort is drastically reduced by leveraging the pre-built core of the platform without sacrificing the customization benefits and requirement coverage offered by the extensibility of the community apps. They also offer a more complete and supported solution than open source software.
App platforms streamline the process to create and maintain in-house custom tools. Developers can use mainstream languages, create small contained components and write less overall code. Impact from developer turnover is lessened and it is easier to document and package tools for usage by a broad spectrum of consumers.
App platforms’ pricing structure offers a middle ground between free open source software and expensive traditional solution costs. They offer the flexibility and low entry point associated with SaaS solutions without having the exponentially increasing cost model. They enable organizations to select and pay for only the functionality that they want, keeping their overall spending low and stable.