The debt stack

The DEBT Stack – the hidden costs of building a tech stack.The tech stack, or software stack, refers to the combination of CRM, software tools and frameworks that a staffing and recruitment firm uses to run its business. The idea behind building a tech stack is to use a CRM and a set of carefully selected technologies that work well together to create a cohesive and efficient system.While building a tech stack may seem like a good idea on the surface, there are several challenges and hidden costs that business leaders face after committing to this approach. Time and ExpertiseSuppose you are considering a CRM that encourages a tech stack approach. In that case, evaluating the depth and quality of the integrations between your systems is a significant investment of time and resources and may require skills you don't have in-house. The work involved in bringing systems together and configuring them to work to your specific needs should not be underestimated. Your IT team will need to be experts in the technology you're using AND the interconnectivity between the systems. Vendor lock-inOne major challenge is the risk of vendor lock-in. When a company decides to build its tech stack using a particular set of marketplace partners, it becomes heavily dependent on those technologies and the vendors that provide them. This can lead to problems if a vendor decides to change its pricing model, discontinue support for a particular integration, or if the company wants to change direction and move to a different set of technologies. In such cases, it can be difficult and costly for the company to extricate itself from vendors. Lack of flexibilityBuilding a tech stack using a limited selection of products recommended by the CRM vendor can limit the company's flexibility to adapt and evolve as the market changes. For example, if a new technology comes along that would be a better fit for your needs, it may be challenging to switch to it if no integration is available or the CRM vendor needs to have a commercial agreement in place. Unnecessary complexityMany companies that build their own tech stacks are driven by the belief that they can do it better than anyone else. However, this can lead to the development of unnecessarily complex and inefficient systems simply because they were built in-house. In these cases, it may be more beneficial for the company to adopt established solutions built on a single technology. Unclear strategySitting in the middle of multiple vendors means you must juggle your business strategy with your software vendors' technical capabilities and future roadmap. Each vendor will work to different timelines and goals, so a tech stack built today will likely evolve in different directions and at a different pace in the coming years. Could the tectonic plates of your software infrastructure move out of alignment in the future? API BandwidthThe connection between two systems is often made using software called APIs. This allows the software systems to 'speak' to each other or transfer data between them using an 'API Call'. Because API calls use server bandwidth, many vendors attach a limit to the number of calls that can be made. More connections means more API calls. While it's rare, the risk of running out of API capacity should be considered. Security & Data IntegrityThe security of your data is at risk when you have disparate systems. The connection itself is a security risk and a potential opportunity for hackers or data leakage.Similarly, the integrity of your data is threatened whenever you move information from one system to another. Data corruption, bugs, incorrect data matching, bad code, or simple human error could lead to an issue that may not be immediately apparent. When decisions are based on data, you'd better be sure the data is correct. Multiple vendors For each software provider, there's a relationship to be managed, a service level agreement, review meetings, and new release schedules that may not match up with your other vendors – it's a juggling act. For your Finance team, multiple vendors will be set up as a supplier on your payment system, and managing the additional invoices and measuring the ROI will create extra work for your Finance function for each vendor you add to your stack. Problem resolutionThen there's the risk of "it's not us" syndrome. Sometimes, things break or go wrong, and we need help to fix them. Who do you turn to when there's a conflict or problem with your integrated systems? Even the best software 'partners' have been known to believe the responsibility for a problem is on the other side of the fence, leaving the customer stuck in the middle trying to get two or more parties to sort the issue out. For you, that can mean time, effort and resources lost.Building a tech stack can be a significant undertaking, especially for small to medium-sized businesses. The process of selecting the right CRM and other technologies, training employees, and integrating the various components can be a time-consuming and costly endeavour. In conclusion, while building a tech stack can provide a sense of control and ownership over a company's technology, it is essential to weigh the potential challenges and risks before committing to this approach. Fundamentally, you are bringing together different tools from individual companies and, undoubtedly, different technologies. Businesses need to consider if the benefits of building a tech stack outweigh the costs and whether it is the best use of their resources.Of course, Mercury offers an alternative, with Microsoft's connected suite of applications built on a single technology framework. Fewer vendors, reduced complexity, no data silos and future-proofing from the world's leading business software provider.Get in touch to find out more.Written by Daniel Fox.