It’s safe to say that most people understand the benefits of running a Proof of Concept these days. The operational and technical benefits are clear: it’s an opportunity to look under the hood and kick the tires, ensuring that said product or service is a good fit for your business. But getting the commercials right is just as important as the technical solution, as there are flow-on benefits (or drawbacks) that often extend beyond the project and into production.
A PoC is an opportunity to look holistically at the new technology, from technical footprint and functionality, changes to business processes, to the projected costs of implementing a production version and the operational overheads. So, when Starboard IT was approached with the opportunity to stand-up a PoC environment for one of the 4 major Australian banks, we knew we needed to get the commercials right from the get-go.
More than anything we wanted to avoid the classic “PoC on a shoestring budget”, so often characterised by hand-me-down equipment, built in someone’s spare time, assembled under their desk with little to no documentation. These risks are typically acceptable during a PoC, but ironically the risks ramp up when the PoC is successful: I have lost count of the number of PoC’s I’ve witnessed slip into Production. With equipment on loan from our vendors, that is a situation we needed to avoid.
Below is an insight into the main considerations we used in producing the commercial for this PoC:
Factor in project management costs
In other words we treated this PoC like a mini project. Many organisations do not practice this in an attempt to keep costs down. Even if the effort is given away at zero cost, formal project management ensures the PoC is driven and is tracked. This will ensure that the key metrics are held to account, being: time; scope; and cost.
Utilise your vendor relationships
When we told our vendors what we were about to do, they immediately wanted to be a part of the fun. Having the backing of our vendors like Cisco Meraki, Equinix and HP helped keep the costs contained for the bill of materials, and they were a sounding board for advice and support throughout. They are also able to assist in the design and sizing of the production environments if the PoC gets the go ahead and getting their supply chains activated. This can fast track your plans immensely and particularly important when considering competitive edge and speed to value of the organisation.
Stick to the plan
We had a situation where the performance of the database was under question. As is often the case, the devs pointed at the infrastructure. But by sticking to the plan, working closely with the technical teams on both sides of the fence we were able to identify the cause of performance, ultimately proving it was down to a need for some database optimisation. We had the right hardware but had we not stuck to our guns, it could easily have resulted in costly hardware upgrades, additional implementation costs and extended delays.
Factor in operational cost
Often the ongoing management costs are overlooked. Being a banking PoC, we needed to deliver internet banking level security and that takes time not just to implement, but to support. Add that to the list of ad-hoc requests like performance tweaks, user account management, additional data ingestion etc and the hours start adding up and the last thing a client wants is bill shock.
Consider decommission cost
Client’s can pull the pin on a PoC at any time. Regardless of whether the PoC flies or dies, the PoC infrastructure may not be fit for production use. With this in mind, our commercials had provision for the decommissioning activities up front, such as the data backup, the tools and time to sanitise the estate, time to derack and transport equipment from datacentres etc. It’s a lot easier to justify and get sign-off for these costs upfront rather than in arrears.
I am happy to report that this PoC was a great success and the commercial planning behind this exercise was a significant and critical contributor. Putting in the upfront effort on the commercials pays off over the lifetime of the PoC and provides the added value that management look for.
Interested in learning more about running your own proof of concept? Contact us to discuss how Starboard IT can help you deliver a successful business outcome.