Software: BUILD Vs BUY

TO BUY OR TO BUILD

Build or buy, often expressed as make or buy, is the fundamental decision as to whether to develop something in-house or purchase it from an external supplier. Whether you decide to build or buy, the technology you adopt must align with your business goals.  build vs. buy framework to help you consider the opportunity costs and make an informed decision on whether to buy software off the shelf or build a custom solution.

7 Key Considerations: -

Keep in mind, there is no right or wrong answer—what is right for one company may not work for the other. And in the end, it will probably depend on how you prioritize these 7 Key Considerations.

 

  1. Technology & Compatibility

Among third-party software apps, ease of integration varies widely. However, many packaged software solutions make it possible to perform a proof of concept (POC) before investing in a solution. If you choose to build your solution, compatibility is not likely to be an issue. However, you’ll still need to consider how your solution will connect to it’s potentially disparate data sources.

ADVANTAGES IN BUILD

  • Built in compatibility
  • Full access to code
  • No API required

ADVANTAGES IN BUY

  • Pre-tested Integration
  • Ability to create a rapid prototype or Proof of Concept (POC)
  • Packaged integration/ connectors

      

  1. Features

It’s important to understand your end-users’ needs and how they are driving your prioritization—know what is non-negotiable and what is noise. When considering packaged solutions, it’s also important to look beyond what the software claims it can do, to what it does best. For example, report solutions that are strong in BI analytics often have little to no document generation capability. You may find that two separate packages is an ideal way to offer a best-in-class total solution.

 

 

ADVANTAGES IN BUILD

  • Control to build only what you need and nothing you don’t need.
  • Control the prioritization of feature requests.

ADVANTAGES IN BUY

  • Packaged solutions typically model best practices.
  • Bugs and feature requests are not your developers problem.

 

  1. Performance

The most elegant solution is only as good as its ability to meet performance requirements. Not only must you establish your current performance needs, but you must look into the future to determine how your needs may change over time, and how you will address them. Within any solution, there are countless potential points of failure and performance bottlenecks.

ADVANTAGES IN BUILD

  • Development control over architecture and performance—for better or worse.
  • Ability to update software if performance issues arise.

ADVANTAGES IN BUY

  • Tested configurations and established benchmarks.
  • Ability to establish a Service Level Agreement (SLA).

 

  1. Design

Any well-designed report is able to communicate the right information quickly and clearly. But customer facing documents have the added responsibility of reinforcing a company’s brand, style and professionalism. You’ll definitely need some amount of design flexibility but in the case of branded documents you’ll likely need very fine free-form design control.

 ADVANTAGES IN BUILD

  • Connections and settings can be hard coded.
  • Design functionality for a specific user.

ADVANTAGES IN BUY

  • Standards and best practices are built in.

      

  • Packaged solutions are available with a wide range of design flexibility and control.

 

 

  1. Documentation, Training & Support

Reporting solutions tend to be complex. At least at some level, working with data can be confusing or tedious even for experienced analysts. Most rely on a collection of tools to help reduce errors and increase their productivity, and each of those tools is likely to approach things a little differently and have unique user interfaces. Documentation, training and support can make a huge difference in the success of your reporting solution. Unfortunately, they are often an afterthought, or under-developed components of the complete solution. Developing materials and providing ongoing support can easily consume as much, or more, resources than writing the original code.

 ADVANTAGES IN BUILD

  • Documentation and training materials can be developed around the specific needs of the end users.
  • Control over support prioritization and response.

ADVANTAGES IN BUY

  • Documentation, training and support are typically included.
  • Solution expertise and support are provided by the vendor.
  • Periodic updates are typically provided by the vendor.

 

 

 

  1. Speed to Market

Bringing your reporting solution to market sooner than later has numerous advantages—        provided that you don’t cut corners to do it.

  • Happier end users and customers
  • Lower development costs due to less context switching and less scope creep
  • Competitive differentiation (in the case of commercial applications)
  • Less rogue IT software (in the case of internal enterprise solutions)
  • Faster ROI because productivity efficiency is realized sooner

 

  • ADVANTAGES IN BUILD
  • Ability to do incremental releases to address the most pressing demands.
  • Integration is most likely built into the development process.

 

 

ADVANTAGES IN BUY

  • Input, design, QC development, and documentation are done—drastically increasing your speed to market.
  • Advanced features are likely already built into a mature package.
  1. Cost & ROI

ROI is the bottom-line look at your ‘Build’ vs. ‘Buy’ decision. The beauty of an ROI analysis is that you’ll have a black-and-white number to look at and share with other stakeholders. The downside is that the number will only be as good as your assumptions and thoroughness. This document should help identify the primary costs and payback opportunities. But you should definitely do some digging to uncover the less obvious factors that may be unique to your organization.

ADVANTAGES IN BUILD

  • Expenditure may be spread out over a longer time period.
  • Periodic subscription and service fees can be avoided.
  • Lower development costs as they are spread across many customers.

ADVANTAGES IN BUY

  • Cost estimates are more reliable as they are fixed by contract.
  • Development costs are spread out over many customers and typically far less than one-off building costs.
  • Speed to market will significantly accelerate and shorten the ROI timeline.

 

 

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