As marketers adopt more and moremarketing technology in their work, particularlycloud-based applications, with many choices and many different opinions about what software is best for a particular purpose, the question arises:
To what degree should marketing applications be centralized or standardized within an organization?
This question usually arises from the bastions of the besieged IT department that pictures many different marketers buying many different software packages on their own, all willy-nilly in the cloud, to be a nightmare of gargantuan proportions. To regain control of that chaos, they make the case for whyall technology — and marketing technology is no exception, in their opinion — should be centralized. In the IT department, naturally. (MyChief Language Officer Parable takes this to an absurd extreme.)
But in a world ofsoftware-as-a-service andagile marketing, I’m not convinced that the rationale for centralized IT control of all applications — which was largely etched in stone by the early 90’s before the Web — still holds true today.
One of the main arguments for centralization is that it “reduces cost.” The justification for this claim is usually based on three ways the organization can save money:
1. Eliminating redundant (or semi-redundant) software purchases. If Group A uses Software X, then when Group B wants to do something similar, they can just use Software X too — and avoid spending money on a separately negotiated copy of Software X, or worse, a different Software Y.
2. Negotiating better pricing as they scale up. If Software X charges per person, or by some other factor related to scale, then combining Group A and Group B under the same umbrella gives them more bargaining power and economies of scale in purchasing.
3. Leveraging knowledge already acquired about operating the software. The company went through alearning curve to get Group A running on Software X. Group B can benefit from this experience — but only if they stick with Software X. If they go with Software Y, it’s a brand new learning curve.
A fourth source of cost reduction in centralization used to be shared technical infrastructure — fewer different pieces of software, running on fewer machines, were easier and cheaper to maintain. But now that most marketing-related software is provided “on demand” via the cloud, this is not necessarily a factor.
I’ll be the first to admit: these are legitimate ways to reduce costs.