Tuesday, 14 September 2010

How locked-in are you, really?


In over a dozen years working in the field of Business Process Integration, I have seen many, many forms of lock-in. In Core-business versus business criticality I explained the misunderstanding most businesses suffer from.
Typically, the less knowledge a company has of something, the greater the lock-in - and vice versa

There are three types of lock-in:
  • vendor lock-in
  • third-party lock-in
  • knowledge lock-in
These can be compared to everyday life for better understanding, maybe:
  • vendor: you're a Christian or a GOP
  • third-party: you only listen to your town church or politician
  • knowledge: you tell your children to always listen to your town church or politician
Somehow I keep using religion or politics to show narrow-mindedness or silliness, awkward...

Vendor lock-in starts when your company decides to single out a single vendor. Microsoft, SAP, Oracle: all those are unique and irreplaceable. There are pros, but also cons to a decision like that.
  • Pros: one vendor, one big deal and margin to negotiate - once. One-size-fits-all (hehe) and all your diversity will end!
  • Cons: your vendor is unique and irreplaceable, and there's no vendor in the world who has a package that covers all your diversity. It's the Law of USP: if you have unique selling points, chances are slim they're covered in ready-made applications, isn't it? Only when you do boring business you can take an (any!) off-the-shelf product
Third-party lock-in starts when your company decides to single out a single third party. Consultants, system integrators, outsourcers: all from one and the same firm, they are unique and irreplaceable. And they combine knowledge of applications with(in) their own company, not yours. There are pros, but also cons to a decision like that.
  • Pros: one third party who'll probably engage in some kind of partnership - they'll take care of all your problems, and with the large organisation behind them, be able to help you very well
  • Cons: the distance increases. Chances are, you'll just be used by the third-party to educate their people on the vendor you picked - after all the contract's been negotiated, and now the money has to be made
Knowledge lock-in starts when your company decides to hand over communication to a single third party. You still negotiate contracts with your suppliers and partners, but your trusted third party takes care of all the nitty-gritty stuff. There are pros, but also cons to a decision like that.
  • Pros: one third party who handles it all! Now that's perfect, isn't it? Just like taking your car to the garage - they'll fix it for you, you don't have to know anything!
  • Cons: the rubber band has stretched to the max. Giving away knowledge means giving away control, but most importantly the ability to judge whether you're not being ripped off - on purpose or by accident. A situation like this will usually end with your entire locked-in operation being supported by the Last of the Mohicans - and that usually is one guy alone
Rule number one? Always, always, always own your knowledge: from a business PoV, maintain the functional documentation / specification. It's your business, so your responsibility - take it, and keep it
Rule number two? Have your friends, whatever form they take, document their part of the deal. That's their business, so their responsibility - have them take it, and keep it
Rule number three? Get a second opinion every once in a while to keep the dogs from falling asleep - that means your own people, and your external friends

If you'd use the lock more often, you wouldn't lose the key

3 reacties:

Martijn Linssen said...

Testing Disqus working again - at least Comments are re-enabled now. Still need the Reactions bit to work

Ryan said...

testcomment #ryan

Anonymous said...

Very interesting. Going to continue reading your site.

Dirk

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