When it comes to software, many companies, depending on the size, go back-and-forth on whether or not buying vs. building is best for their business. Knowing when to build or buy a Commercial Off The Shelf (COTS) solution is just as important than actually buying or building one. While neither method fits all organizations, some organizations will use a hybrid of both. Like all decisions, all have pros and cons.
Building a Custom Software Solution:
PROS
Scalability:
For faster growing startups and businesses, building custom software allows you to scale your operations without having to fear incompatibility and impeding growth. While you scale, building a solution allows for customization which will help your solution address the most pressing need for your business. Building also assures the solution integrates with and supports existing business processes that may be unique to your operations.
Ownership:
In addition to fostering growth, building a solution allows for ownership of the software without having to give significant royalties and/or annual licensing fees to another organization. Depending on your business niche, this can be extremely important because control over data can greatly impact market share, profitability and a company’s valuation. A custom solution is designed to accomplish immediate and long term goals making it a valuable asset now and in the future.
Flexibility:
A custom solution is much more flexible and is easily modified to your growth or changes in your business model. Whether you product was built in-house, by a trusted software development firm or a combination of both, your custom built solution has a significantly longer life cycle.
CONS
Price:
Building, maintaining and updating a software solution is a running and expensive cost for any business. Building a medium-sized enterprise software program is only the beginning. Maintenance and supervision is an ongoing investment.
Manpower/supervision:
Building a software solution often requires a competent IT department. This might not be suitable for some businesses.
Buying a COTS solution
Pros
Less bugs:
By purchasing a COTS solution, your organization will save time that would have been spent dealing with bug fixes in your software solution. Most of the COTS solutions available in the market today already have thousands of hours of research and development, allowing them to address most of the bugs your organization would encounter.
Outsourcing IT:
Most COTS solutions will have support from the vendor’s developers, minimizing the need for internal headcount.
Cons:
Reliance on third-party:
Since your organization does not own software, third-party companies that provide this software or able to see the data. Your organization does not retain the rights to the code of the software, which can become problematic if your organization is growing rapidly and relies heavily on the software. COTS solutions that are developed by an external party won’t be tailored to your business in specific needs so it may not be applicable to your business.
Conclusion:
Often, the complexity of your business processes will drive this decision. It is important that your stakeholders meet with the developers to make certain all aspects of the problem are understood. Your COTS vendor can verify their product can deliver the desired outcomes. The custom solution developer can provide a cost comparison to a product that is certain to attain all project goals.
If you would like to learn more about what we have to offer, please visit Strategic Data Systems at https://sds.io and check it out for yourself.
