Build vs buy software: which is best for your company?

Build vs buy software. Which is better? That is the question. At some point, you’ve probably thought about upgrading your enterprise content management (ECM) system or one of your other business solutions. It’s not so much a question of “if” as it is a question of “how.” Of course, it makes sense to update your systems but how should you go about doing it?

Generally, you have two options. You can either buy or license software from a third-party supplier or make the decision to build something yourself. Depending on the size and capabilities of your IT team, that can be a tough call. At first glance, building your own custom proprietary software solution can actually appear to be cheaper. However, looks can be deceiving. There are almost always hidden or unexpected costs associated with building your own business system. It’s something that many companies fail to factor into their budgets.

For a smaller business or a team with limited development capacity, buying may reduce the work of operating the underlying service. Custom software can still be appropriate for a requirement that available products do not adequately meet. The decision depends on that requirement and the team's capacity to maintain the solution.

The Real Cost of Custom Business Systems

The upfront cost shouldn’t be the only thing that you consider when deciding whether to build your own system or buy an external SaaS solution. While the initial price tag may be lower, you also need to be aware of the other risks and costs that come along with custom software systems. The three issues that you should take into account when evaluating if an internally built system is right for your business are maintenance, system stability, and required in-house expertise.

Maintenance

When you create an in-house solution, the system’s maintenance is solely the responsibility of your IT department’s software developers. With that in mind, you should factor in how much time it will take them on a daily basis to keep everything running smoothly. If your system isn’t connected with other external services, maintenance may not be a big issue. However, if it interacts with any other systems (like cloud services), it’s going to be demanding. Most third-party services are updated frequently. So, if you want to keep your custom system working, you’ll either have to hire additional staff or accept your IT department’s reduced capacity to handle other issues or research and implement new, exciting technologies.

With software as a service, the vendor operates the service, but the customer still manages users, configuration, integrations, and business processes. Check the contract and operating model to establish each responsibility. This can free some IT capacity, but a subscription does not remove all maintenance work.

System Stability

When you build a custom business system, you can design it around specialized requirements. Those features still need implementation, testing, and ongoing review as the business changes.

However, businesses change and your system will need to change along with it. That’s where the drawbacks of a custom system begin to appear. After multiple patches, workarounds, and unconventional fixes, your system can become increasingly unstable. As each update builds on top of the last, you may soon find that the integrity of the entire system is compromised. That can make your business vulnerable to data breaches, system outages, and catastrophic failures.

With a SaaS solution, evaluate whether the supported configuration and integration options meet your requirements. The vendor operates its service, while your organization still needs to assess availability, manage its settings and integrations, and plan for incidents. Buying does not eliminate stability risks.

In-House Expertise

As your solution becomes more outdated and increasingly customized, managing it will begin to require highly-specialized in-house knowledge. IT staff who have dealt with the system for long periods of time will become increasingly indispensable, making it difficult to bring on new employees and manage labor costs. If a custom system depends on one or two employees, you may not notice how dependent you are on them until they’re on vacation when a major problem hits. Without the relevant expertise available, you’ll be in a tough spot trying to get your system back up and running.

With a SaaS product, onboarding effort depends on the application, configuration, and users' roles. Assess training and administration needs rather than assuming that purchased software will always be easier to learn.

Buying is Usually Better

While a custom ECM or business system can address specific requirements, it also creates ongoing responsibilities. Maintenance, system integrity, and continuity of expertise belong in the comparison. Buying may be preferable when a product meets the requirement and the organization cannot sustain those development responsibilities.

Custom systems can make sense for a requirement that available products do not adequately meet, provided the organization plans for long-term maintenance. For standard requirements, compare available SaaS products on fit, integration, administration, and exit costs. Buying can reduce development work, but time and cost savings depend on the implementation.

Modernize with AODocs

AODocs is a flexible, cloud native content management platform designed to increase business agility by replacing legacy/on-premise systems with a scalable SaaS environment that allows business users to build and control their content-rich processes.