Build vs Buy: Three myths about buying software you should ignore (Part 1)

March 22, 2016 Oi Hua Lee

Over the past few years, the options available to organizations looking for technology-based solutions have increased greatly.  This is due to the rapid evolution of software development techniques, the move towards open-source software and the wealth of software packages from vendors around the world. As such, an argument has been raised: when it comes to software, is it better to build or to buy?

The arguments
There are many arguments for both sides, but here are a few for each that you are likely to encounter:

 Buy arguments

  • Buying is better because developing software is not a core competency of your organization
  • Buying software from a vendor provides a lower total cost ownership
  • Buying software is less risky because you’re relying on a few key employees if you build your own solution

While these arguments seem like they’re definitely worth considering, they are not without their flaws. In this blog, we’ll tell you why these arguments are no longer valid.

Buy Myth #1: Buying is better because developing software is not a core competency of your organization

Buy pundits often say that organizations should stick to what they do best and opt to buy COTS software rather than build their own solution. This is an interesting argument, but is a dated approach on the matter, rooted deep in the early days of program development when resources and technology were limited. Long gone are these days—in fact, with the rapid maturity of computers, software technology and developers, internal IT resources can now rival software vendors in terms of talent, structure, process and tools.

Today, hospitals, consulting firms, financial institutions, manufacturers and other organizations are capable of acquiring the necessary talent they need in order to build their own quality software solutions. It is for this reason that this is no longer a valid argument.
 
Buy Myth #2: Buying provides a lower total cost of ownership

This myth is once again a dated one. In the past, it may have been true that the cost of building software in-house was disproportionately higher than buying similar commercial-off-the-shelf (COTS) software. This idea was formed based on the assumption that in-house solutions need to match their COTS counterparts and its feature sets. However, this argument doesn’t take into account that in some cases there are organizations who don’t utilize all the features that COTS offer.

Often times, when organizations undertake a project its operational requirements are outlined before it is built to specifications. As such, it would be more accurate to compare costs based on building something your organization really needs.

Buy Myth #3: Relying on just a few internal resources is risky

This argument is based completely on fear—fear that the key person working on a solution built in-house might leave the organization, leaving the future of the in-house solutions at risk. The reality of the matter is that turnover is simply an everyday risk for every organization, and as true as this may be the fact of the matter is that nowadays full teams of skilled individuals work on a project together, and are able to adapt to turnover. 

This argument also conveniently ignores the fact that vendors are also susceptible to turnover as well. So while the loss of resources is something to consider, it shouldn’t be part of your key considerations when choosing to buy or build a software solution.

Conclusion

There are strong opinions on both sides of the build vs. buy debate, which can make it rather difficult to make a decision. Despite this, having the debate is a sign of a healthy organization. The most important thing you can do during this time is to make sure that only valid non-biased arguments are considered. 

Ready to hear the other side of things? We're ready to share! Read part 2: Three Myths about building software you should ignore!
 

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