Making Multi-Tier Solutions Work in Businesses
Multi-tier solutions can be aligned to specific requirements of organizational subdivisions within businesses.
As companies evaluate the status quo and look for possible areas to focus on in terms of improvement, they are under ever-increasing pressure to find new sources of top-line revenue, M&A activity and diversification, which are changing the physical structure of many organizations. These organizational dynamics will lead many companies to question the desirability of centralized or single-image systems versus multi-tier solutions aligned to specific requirements of organizational subdivisions.
For those companies that have maintained tightly controlled, centralized systems deployed over multiple sites, divisions and lines of business, the prospect of “going multi-tier” may seem daunting if not outright dangerous. The fact is, that fear is not entirely misplaced. Any change of this nature should be made with deliberation, caution and a clear vision of what is to be the end result of the change.
Challenges with Multi-Tier Solutions
Some of the challenges associated with multi-tier can be mitigated by due diligence upfront. Before you start disconnecting cables and modems, spend some time planning.
Define Your Vision
Multi-tier means different things to different people. A clear vision about what your multi-tier world will look like is useful to ensure that what is being proposed is universally understood. Multi-tier can be defined between divisions, lines of business or geographical subdivisions.
When you talk about systems for individual divisions, you are really talking about separate businesses. Divisions tend to be fairly autonomous and usually feature some degree of specialization. Tailoring systems to align with the unique needs of a specific division is an entirely different brand of multi-tier from a deployment of separate instances of the same system. In his article “When Global ERP Doesn’t Fit: Multi-Tiered ERP Strategies for Bigger Businesses”, Paul Bywater likened this to the “think globally, act locally” vision.[i]
For different lines of business, the deployment can be more complex because a line of business might mean finance versus sales or manufacturing versus purchasing. Each of these functions has different requirements within the corporate family. They also have to work together as a team to carry out the company mission. Compatibility and the ability to exchange data is critical.
Ownership of Multi-Tier Systems
Who is going to own the assorted individual systems? By ownership, I mean who will have ultimate administrative authority over them. If the system resides at a sub-divisional level, the oversight and management of that system should likely reside there as well. This would apply to the buy or selection decision as well as the ongoing management of the system.
Corporate overlords have a tough time seeing things from the point of view of local folks or those actively involved in the actual local business. Corporate or the home office does need the information generated by the local systems, so their needs must be fulfilled by the selected system regardless of who actually uses it on a day-to-day basis.
Both entities, corporate and local, have legitimate needs, and these requirements are equally critical to the success of the system in question and of the organization as a whole. Licenses should reflect the needs of the local users. If it is anticipated that usage will extend beyond the local entity, care should be taken to ensure that usage beyond the entity is permitted under the license.
An ideal arrangement might include back-up licensing for the corporate system for disaster-recovery protection or even test and development copies.
Multi-Tier Solution Selection Criteria
The whole point of multi-tier is to ensure that systemic functionality is aligned and matched to the users’ needs and local organizational needs. This requires local input and extensive review of the local requirements. These requirements should also extend to compatibility with corporate systems and the ability to pass data between the two systems. Corporate has performance reporting, compliance and other needs that must be met in the form of data provided by the local operation.
In the same vein, platform and environment might also be of some concern. The local operation may well be running on a server-based solution or a solution distributed across multiple desktops. The corporate systems may be on something else altogether including some kind of mainframe-centric platform. While mission and need should dictate the local requirement, the ability to federate disparate data into a single picture will remain on the corporate needs list. These things can all be accomplished across multiple platform environments, but that doesn’t mean this should be left until the end to explore.
This is especially true if cloud or SaaS options are being explored as alternatives to a localized internal system.
Implementation and Deployment
Implementation is also an important consideration at both levels. The local operation must be well-trained, and the deployment process must be complete and thorough. Implementation should extend to the data sharing facility and include whatever training and QA is required to make sure the system works both locally as well as in conjunction with the rest of the enterprise.
Cost of any system must be reckoned in multiple ways. License fees and maintenance cost are only part of the story. Indeed, cost may be one of the motivators for looking at multi-tier since so many of the enterprise, single-image-oriented systems are very expensive at the small individual site or limited-usage level.
Evaluate and Make It Work
As with any system deployment, part of the plan should cover the post go-live date. You can’t set it and forget it. Some permanent review or periodic evaluation process should be in place to ensure that concerns uncovered at the local or corporate level are quickly addressed. Regardless of who owns or manages the systems, user feedback is necessary to ensure that everyone’s needs are being met.
If your organization is composed of a holding company, corporate and autonomous individually branded subs or if you are a cohesive organization with organization segments, you still have a two-way view of the world: the enterprise view and the local view. These two views should have some commonality without losing sight of their own unique characteristics.
Expectations at all levels should be that the needs of the other are met along with their own. Multi-tier solutions are a great option as long as everyone’s needs are met.