My father was often puzzled when people were concerned about a car’s resale value. “A car is a tool, not an investment,” he would say, and apart from collectors, dad was right. The important thing in his mind was not only the price of the car, but also the cost of taking care of it. While he never used the term, dad was a steadfast supporter of measuring Total Cost of Ownership, or TCO. He knew that the ongoing cost of maintenance has the greatest impact on the overall value of your car.
Your chosen eRA system will most certainly be an investment, but likewise it’s a tool with a number of different factors that can affect the cost over time. What really needs to be evaluated are both the short-term and long-term costs for implementing the solution, keeping it in tip top shape and ensuring all users remain properly trained. For my money, these implications equate to value, and that’s why I consider TCO the most important measure of value.
What is the Value of Your Purchase?
No matter what the moniker or acronym, what you want from a quality eRA solution is value. Your first question should always be, what exactly is included in the purchase price and what are add-on costs? Using sophisticated software requires training, for example, and rest assured eRA solutions are sophisticated. How much training will you and your staff need to effectively use your chosen system? How much training is included in the sticker price, and will that amount of training be enough? Will new employees need vendor training, or will your staff be prepared to do so?
Scalability is a cost factor too. For instance, Cloud or SaaS solutions can scale without impacting internal resources, because there are no server updates or desktop pieces to deploy. Also, some licenses can be user based, which means that expansion on your team could require paying for additional users. And while licensing is certainly a factor in assessing TCO, don’t be fooled by claims that Open Source software is free. Open stands for “open your wallet” because you’ll need significant IT help to implement the system and keep it up and running.
On-Premise versus SaaS Solutions
Whether on-premise or in the cloud, consider all factors that impact TCO: infrastructure requirements, implementation times, out-of-the-box functionality, IT involvement and EVERYTHING that impacts compliance. On-premise solutions require infrastructure and ongoing IT resources. Often the personnel costs can add up to more than the cost of the solution. SaaS solutions require high-speed Internet connections and dedicated bandwidth. Implementation times for on-premise solutions can take more than two years, while many SaaS solutions can be up and running in months or even weeks. While on-premise solutions often offer a greater ability to customize features, changes can hurt stability and how vendors ultimately support the product. Finally, new versions and enhancements to on-premise solutions can break those aforementioned customizations and will eventually require both server and desktop upgrades, while SaaS solution upgrades are performed by vendors and typically have no impact on users. This last point is why so many Institutions are not running the latest version of their enterprise solutions, foregoing the newer enhancements to avoid the hassle and expense of upgrades.
You also need to realize that software will never do everything every customer wants. No matter which eRA solution you choose, there will always be a need for tweaks and modifications to both the solution and your own internal processes. Start by focusing on what each solutions does, then do your homework. The ease by which products can be modified varies greatly. Get to know your vendor and the team that will shape your eRA solution to your institution’s needs. Along with inherent product knowledge, look for people with industry know-how and a sense of industry best practices. The more your chosen vendor knows the industry, the better they will be at crafting the product correctly the first time and avoiding the ongoing “scope creep” that plagues the longer and more expensive projects.
Like so many big ticket items, the upfront cost of an eRA solution is only the beginning. Evaluating TCO for an eRA purchase may not be simple, but it’s essential for the success of your organization. Every vendor can provide details on the solutions they sell, and we all have colleagues using the various solutions available. Like so much that is done in research administration, you need to educate yourself to be able to make the best purchase decision for your institution. Read Part 5« Back to Cayuse Blog