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Matti Grönroos

Fit-for-Purpose or Best-of-Breed

A very key question related to IT service is what the target degree of being fancy is. An engineer would most probably give a different answer from the company financials people.

The fit-for-purpose thinking is about delivering quality and features good enough for the business case. Not too low, not too high. When negotiating the service agreements, the fit-for-purpose is about avoiding unnecessarily high SLA targets, and unnecessarily expensive management tools.

However, especially in the techno business, gaining credibility and reputation might need to invest into best-of-breed tools even if they were an overkill. In general, the younger generation engineers are not fully aware on the cost implications, and they value the best-of-breed thinking.

The IT quality targets are a part of the corporate business case, like any other investment.

A few years ago, everyone seemed to request for 'nine fives'. Nine fives equal to the availability target of 99.999 %. Sounds wonderful, but soon the corporate CFOs started to ask nasty questions: Would a 30-second IT systems downtime a month really create a major financial problem to us? Or is the 95 % time-to-resolve target (with sanctions) for Incident Management reasonable: Would we really go out of the business if one of 20 tickets missed the deadline?

The CFO understands the correlation between the quality targets and the cost. For example, the traditional rule of thumb of availability tells us that each additional nine in the target increases the price tenfold. Thus, 99,99 % is 100 times more expensive than 99,00 %. In the world of cloud services, the correlation is not that straightforward, but no smoke without fire.

Most likely the vendor makes a proposal to agree on a 80 % target for Incident Management. If the customer insist on having a higher target, 90 % or even 100 % (which is a mission impossible), the vendor may agree with this. However, it comes not for free, but the price tag may be pretty surprising. Again, the CFO calls the CIO and asks if the IS/IT really needs best-of-breed, or would it be better to align the targets with the corporate fit-for-purpose thinking.

The business case talks. If we are in a business where it is important to have best-of-breed tools as a showcase to attract new customers, the fit-for-purpose approach at the customer interface is not valid. The back-office functions might be a different story. Best-of-breed may also be used as an instrument to attract and retain skilled and complacent experts. It is up to each organization to assess if this really has a business case.

One aspect of best-of-breed is to make point solutions by selecting the best possible solution for each use case. This does not necessarily make the cost high, because a waste number of free open-source solutions are available. Still, the final price tag may be high, because of the integration effort needed to make these masterpieces to work together.