Slowly but surely, market demand gave rise to third-party ancillary products, and also put pressure on data processing providers to accommodate them. Credit unions rightly insisted on the ability to deploy best-of-breed solutions without obstruction from their data processors, and data processors begrudgingly gave in, sometimes charging seemingly excessive integration fees to ensure they still got some small piece of the pie.

Is Best Of Breed Really Best?

Best of breed has been the popular approach in credit union technology for a number of years now, and with good reason. By picking and choosing which solutions are best suited for their particular environment, credit unions are able to take control of their technological landscape and ultimately custom-tailor the member experience.

The downside is that going the best-of-breed route requires a considerable investment – in both time and money. The IT staff is typically larger in this environment. There are often integration fees that need to be paid to the data processing provider. Product deployment typically takes longer than with a data processor-provided solution.

The single question that each credit union must answer is: Are the incremental gains in functionality and/or control worth the added investment? Today, data processor-provided solutions seem to be making a resurgence as more and more credit unions answer no.

One-Stop Shopping

Why the shift? While certainly not right for every credit union, a one-stop-shopping approach offers several advantages:

• Easier deployment.
• Tighter integration of products.
• “One throat to choke.”
• Less burden on IT staff.
• Lower total cost of ownership.

Lower TCO can be especially important, because many data processing providers will discount ancillary products to encourage renewals for their primary products.

And Then Came Omnichannel

Over the last couple of years, omnichannel has become the dominant industry buzzword. Beyond multichannel—offering services through several different channels—omnichannel calls for financial institutions to offer a consistent and unique user experience across all service channels. While it may seem that data processing providers, with their one-stop-shopping approach, are better positioned to deliver on consistency, their solutions may not offer the customizability that can translate to a unique user experience. If best-of-breed providers can deliver highly flexible, adaptable solutions that can integrate well into an omnichannel strategy, they may have the final word in the best-of-breed vs. one-stop-shopping debate.