A few weeks ago Craig Schiff, President and CEO of BPM Partners, posted his “2011 Performance Management Wish List”. As I read the first wish, something stood out to me. He talks about the need for companies to focus on “the holy grail of performance management” by employing tools that focus on strategic, financial and operational areas. I agree that any company serious about improving performance needs to spend significant energy in all three of these areas. A system that is implemented with no vision on how it fits into the long term strategic goals of the organization is destined to disappoint. But when selecting technology to achieve this trifecta, Craig offers the opinion is that large BPM vendors should expand their offerings to cover missing elements instead of encouraging companies to search for best-of-breed systems to cover the gaps.
The problem with this theory is that a comprehensive suite of systems is not the best option for all companies, or even industries. For process manufacturers concerned with product costing, the folks we work with that selected the ‘cost module’ from their ERP system have found that it is not substantial enough to handle the rigor necessary to really help them develop a robust costing process. They were sold on the idea that they would have a single platform to manage the entire operation. But the reality was while they had an “integrated ERP solution”, all of the real cost accounting work is occurring in spreadsheets on the desktops of cost accountants all around the company.
While many would argue that there is a significant cost to using best-of-breed solutions, if the solution enhances the overall performance of the business by decreasing non-value-added activities and guiding better decisions, then the argument is moot. The best of the best-of-breed solutions are well equipped to seamlessly integrate with existing IT infrastructures and help companies eliminate rogue systems that pop up when people don’t have access to the tools they really need.