November 19, 2014
Out of the Box vs. Custom Build

For the majority of my career I have railed against “Out-of-the-Box” BI solutions because businesses don’t come out of a box, processes don’t come out of a box, and innovation doesn’t come out of a box. I’ve prided myself on being able to re-engineer OOTB solutions and achieve better performance, extra metrics, and better analytics. Today, I’m eating a few of those words. Do I still believe in the custom solution, absolutely, but I now have a better understanding the right time, place and situation. In the end, every company needs to pick a strategic that is right for them, and unless Babylon is burning, they need to stick with it and support it since data is the most valuable asset.

Size Matters
When does an out of the box solution make sense, and when is it the only rational solution?
Size matters. If the company or client you are dealing with is a global presence, and implementation speed is a necessity, then the OOTB solution has to be considered. Dealing with multiple locations on multiple continents, with multiple conversion rates and currencies? OOTB may be the solution you need to use. If you are dealing with a small company, with a small footprint, a custom solution makes total sense and the ROI will be more achievable than dropping millions of dollars for an SAP or Oracle solution. With that said, something like  SAP’s “Rapid Mart” solution may fit the bill for some small to medium size companies, you just have to do the proper evaluation.
 Some of the “Pros” of Buy vs. Build:
  • Standard Data Models and ETL processes
  • Standard Reporting Platform
  • Extendability (modifying ETL/Data Model to meets needs)
  • Quick to user deployment when compared to custom warehouse

The biggest concern with the out of the box solution is generally how much customization will be needed?  Or conversely, how much will my business processes need to change to fit in the box?

Some of the “Pros” of Build vs. Buy:
  • Tailored solution for the business
  • Freedom to select “Best of Breed” tools that fit your budget
  • No concern over updates and upgrades from the OOTB Vendor
The biggest hit a custom solution will take is always the time to deliver the solution, which depending on size can run anywhere from 3 months to 18 months or longer. At the pace that business moves and the importance of a competitive edge it may be hard to convince the business that it is worth the wait. (Agile BI anyone?)
Regardless of the direction, you will still need talented staff to build, maintain and extend your BI solution, there is no choice in that matter.
Balancing Corporate Reporting with Local Reporting
If you are a multi-national company, with billions in revenue, having a corporate set of standard KPIs is a must to have any idea of your performance and your areas of improvement. There is a balance that must be struck though, and that is the local needs of the business. A location in China may look at their business in a different way than a location-based in Southern California, and those two location might look at things differently that corporate headquarters looks at the numbers. While ultimately all three should be looking at and managing to the corporate KPIs, the day to day operational needs need to be met. This is where the extendability of an Out of the Box solution is key. I have seen OOTB solutions that were not flexible at all, and those solutions tend to get replaced by spread-marts, or shadow reporting initiatives. Larger, more mature, OOTB vendors realize this and allow for extension and customization of their solutions. The statistic you hear regularly is that a good OOTB solution meets about 60%-75% of the needs, and the remaining percentages are where the customization comes in to play.
Show Me the Numbers
In the end it comes down to the numbers, and all the business users really want and need is to see the numbers that drive their business. They don’t care if it is a big “Out-of-the-Box” solution or a home-grown data warehouse. What they do care about it accuracy, consistency and validity. If you are giving them those three things, the solution is semantics.