Digitalization strategy: How to choose the right one?, part 3.

Business Digitalization Strategy – Two Possible Approaches:

• All-in-one
• Best-of-breed

The all-in-one concept bundles all required functions and tools into a single application, while the best-of-breed approach offers specialized modules for specific domains. This article compares both concepts and explores which approach may be the best fit for your company.

Today, digitalization is essential for successful business. Beyond selecting the right technologies and tools, it’s crucial to choose the right strategic concept. There are two primary approaches to digitalization:

All-in-one

The all-in-one approach focuses on delivering all necessary capabilities and services as a single, unified solution. It offers simpler administration and built-in integration across apps and services, which can be attractive for companies looking to reduce IT infrastructure and staffing costs.

Benefits

1. Simplicity: A single system makes it easy and fast to access all functions. With one tool, training and maintenance costs drop and employees don’t have to juggle multiple applications.
2. Efficiency: Integrating all functions into one system helps organizations leverage data more effectively and respond faster to change—raising efficiency and output quality.
3. Consistency: A unified platform promotes cross-department collaboration and better coordination, enabling quicker responses to customer and market needs.

These advantages are appealing for companies aiming to cut IT costs and improve workforce efficiency. All-in-one solutions are common in smaller organizations that need a simple, effective setup, and in domains like retail where simplicity and speed are critical.

On the other hand, all-in-one also has drawbacks. You’re tied to one vendor and may miss out on specialized apps from others. If a component underperforms or doesn’t fit specific needs, replacing the entire system can be costly and time-consuming.

Best-of-breed

The best-of-breed approach is the opposite: instead of one system for everything, you select specialized applications for each area and integrate them to achieve optimal performance across the business.

Benefits

1. Specialization: Best-of-breed tools are designed for specific domains and tasks, delivering deep functionality and strong results where it matters most.
2. Flexibility: Organizations can choose the apps that best fit their needs and tailor them to specific requirements—improving responsiveness and overall performance.
3. Innovation: Best-of-breed vendors often adopt new features and technologies faster, helping organizations stay at the cutting edge.

The best-of-breed strategy suits medium and large enterprises with specialized needs across finance, manufacturing, logistics, marketing, and more. These companies benefit from the best tools in each area, improving efficiency and performance—though budgets must also cover integration and ongoing management.

Its main drawbacks relate to integration. Specialized apps can be harder to connect into an existing landscape—challenging for smaller firms with limited resources or for teams seeking rapid results.

Another challenge is the selection process itself. Choosing the best tools requires thorough market research—and often expert help—which can be costly and time-intensive.

A Key Strategy for Business Success

Digitalization is crucial for success today, and selecting the right solution concept—your digitalization strategy—can be decisive for achieving business goals.

Final Recommendations for Choosing a Digitalization Strategy

Choosing the right strategy can be critical to success. The decision between all-in-one and best-of-breed should reflect your company’s needs and goals—as well as size, required flexibility and specialization, and budget.

All-in-one solutions fit smaller companies with limited resources that need an easy, cost-effective way to improve processes across business areas. They offer simpler integration, easier administration, and a unified interface—but can be limiting in specific areas.

Best-of-breed is better for larger organizations that require specialized solutions for particular domains. It enables selecting the strongest apps in each area—often yielding higher efficiency and productivity—but demands more investment in integration and management.

When selecting a strategy, weigh the need for specialization and flexibility against overall budget and long-term objectives. If you choose all-in-one, pick a reputable vendor. For best-of-breed, select trusted providers and plan sufficient integration investment.

In all cases, conduct a thorough analysis of needs and resources before deciding. The right digitalization strategy boosts efficiency and competitiveness—and should be treated as a long-term investment in your future.

More Articles from the Digital Transformation Series

What is Digital Transformation?, Part 1.

Benefits of Business Digital Transformation, Part 2.

Business Digitalization Strategy: How to Choose the Right One?, Part 3.

Using the Microsoft “Ecosystem” in Digital Transformation, Part 4.

How to Execute Digital Transformation: 5 Steps to Success in the Digital Era, Part 5.

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