Software: Buy Vs. Build

When humans need help, technology often steps in. From accounting software and CRMs to the Large Hadron Collider and space rockets, there is a technology-powered solution for seemingly everything.

Software solutions are the most common answer to today’s business problems. Do you need to increase productivity? Cut costs? Improve customer service? Create a faster employee onboarding process? Generate and close more sales leads?

Each of these problems can be solved with the right processes and technology. Accounting software, ERP and CRM systems, marketing automation platforms, ecommerce integrated solutions—these are just a few examples of software that can help solve a business problem or make a workflow more efficient.

Identifying the problem you want to solve is a crucial first step in setting yourself up for software success. Set clear goals and write down which business processes you need to improve. Analyze the potential outcomes of implementing a software solution—for example, decreasing the time spent on manual data input by 30% or 12 human hours per week.

As soon as you have the initial analysis completed, you can start thinking about how you’re going to implement a software system to make your goals a reality. There are two primary options: buying off-the-shelf software or investing in a custom software solution.

Buying software means using an already-built platform and paying a license or subscription fee to use it. You subscribe to a SaaS platform like Salesforce, Slack, or Dropbox (or thousands of others that exist). Building software, on the other hand, means working with a development team—within your organization or outsourced—to build a system completely customized to your needs. 

Buying and building both have pros and cons. Your situation and your needs will determine the best option for you.

Buying SaaS Off-the-shelf

The first thing that comes to mind about a SaaS option is the availability. It’s already created, nicely packaged, and it can be “shipped” to you with just a couple of clicks. Other advantages of buying off-the-shelf are:

• It requires a smaller investment in the beginning.

• You can implement it almost right away (you still need to account for the learning curve).

• You can make an informed decision through existing customer reviews.

When you choose to implement a SaaS system, you usually aim for an 80% match with your needs and your processes. This is the industry rule of thumb. However, in practice, that number is closer to 60%—you can expect a 60% match between your needs and what off-the-shelf software offers. Which brings us to the disadvantages of this approach:

• Poor product fit, which leads to the need to implement workarounds or buy additional software solutions to compensate.

• Increased costs over time.

• You will pay for features you’ll never use.

• You don’t have a say in how the product evolves, like what new features are developed and what features are discontinued.

• The vendor can choose to discontinue the software altogether and you’d have to scramble to find a new solution fast.

How to Evaluate SaaS Software

Evaluating SaaS options is not an easy task. The first thing you need is clarity—to know exactly what you expect from the software. Our suggestion is to divide these expectations into three major groups:

• Must-have features: these are non-negotiable. If a SaaS option doesn’t have all of them, it will not make the shortlist.

• Should-have features: these aren’t 100% mandatory, but they will add significant value to your business processes. 

• Nice-to-have features: functionality that could be valuable (now or in the long run), but launching without it is not a deal-breaker.

These three pillars should give you a good idea of what you’re up against. Remember what we said above about the rule of thumb: A SaaS should match 80% of your needs? When you set out to evaluate your off-the-shelf options, we advise you to aim for 90%.

Why be so picky?

Because not everything works as advertised in software. You will find unexpected glitches and features that seem useful but are far too complicated to use in real life.

If none of the off-the-shelf SaaS platforms meet your needs, you may need custom software. 

Building Custom Software

Custom software mitigates the risks listed above. Some of the primary selling points of custom software are:

• The software is created to match your exact needs, so there will be no extra or unused features.

• The solution can evolve along with your needs. With agile/scrum development, custom software is an ongoing process and can adapt and evolve as you need it to.

• Better security. Custom software has security features that are specific to your industry and consider the most common risks to you, not to the other thousands of clients.

• You have an undeniable competitive advantage. No competitor of yours uses the same solution, so you have access to unique insights and unique ways to leverage your custom software.

At a glance, it might seem like bespoke software is always the way to go, right? Well, not always. Even though Far Reach is a custom software development company, there are a few reasons why we don’t recommend this solution to everyone:

• Higher initial costs, along with smaller investments as the project progresses. Custom software is a long-term investment.

• Timeline to implementation. Bespoke software takes time to be developed, even to an MVP stage.

• Time investment from your staff. For custom software to be successful, you need to invest time meeting with the development team, running internal analyses, offering detailed feedback, and so on.

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Signs You Need Custom Software

See if you could benefit from custom software.

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There is no one-size-fits-all when it comes to choosing the right software approach. Even more, you don’t have to think in absolute terms: buy versus build is a false dichotomy. There’s the middle ground, too.

Do you need a solution faster than custom development can accommodate, but there’s nothing on the market that fits your needs to a T? That’s usually the case.

If you don’t have the time to wait for custom development or the budget to invest in it, or you want to validate your custom solution before you undertake building it from scratch, you can buy AND build. 

Buying and extending involves starting with an existing software platform that allows custom development on top of the core system. Extendable systems can be open source or licensed platforms. 

Because you’re starting with a base system, an MVP can be spun up more quickly than with full-blown custom development. Once the base is configured the way you want, you can build custom components (also known as widgets or plugins) to expand and customize your capabilities in the platform. 

In other words, you can get the best of both worlds: fast implementation and personalization.

Buying and extending doesn’t result in a completely personalized solution, and you still don’t have control over how the core software evolves over time. But it can be a great option to give you a quick and cost-effective solution to a business problem.

Custom portals that integrate multiple platforms and data sources into a unified interface allow organizations to have the best of both worlds by combining off-the-shelf SaaS software with custom development. By consolidating disparate tools and data streams into a single portal, users can seamlessly navigate and interact with various applications without the need to switch between multiple interfaces. This streamlines workflows, reduces the learning curve for users, and ultimately boosts productivity.

Another significant benefit of custom portals lies in the improved decision-making capabilities facilitated by consolidated data. Custom portals can aggregate information from diverse sources, providing a comprehensive and real-time view of key metrics and insights. This empowers decision-makers with the information they need to make informed choices swiftly. 

Custom portals also contribute to a more seamless user experience (UX). By creating a unified interface tailored to the specific needs of an organization, users can access the functionalities of various applications without the need for extensive training or context-switching. This user-centric approach enhances overall satisfaction and encourages widespread adoption of the integrated digital ecosystem, whether users are internal, external, or both.

Sometimes, things aren’t as clear as they seem on paper. For instance, it’s not always obvious whether a certain feature is worth the extra investment. Without the necessary background, it can be hard to evaluate the ROI of a SaaS system, custom software, or the buy-and-extend approach. 

This is where expert consulting comes into play.

At Far Reach, we have helped dozens of customers with this dilemma. Our buy vs. build analysis has your needs at its core and takes into consideration your medium- and long-term business goals.

In other words, we will focus our analysis on what can bring you the highest ROI. 

Working with expert consultants means that you benefit from our decades of experience in strategically deploying software within businesses using all three approaches: SaaS, bespoke, and buying and extending. We can understand your needs, evaluate your options, and provide recommendations. 

Furthermore, if the optimal solution happens to be buy and extend or custom software, you already know a custom development company (that’s us) that’s familiar with your needs.

Saving money is always a consideration, and SaaS platforms can help you do that—at least in the beginning. However, if the SaaS option you choose is not the right solution for you, starting down that path can end up costing you more in the long run.

Switching vendors because of poor fit to your needs is very costly. So is buying additional software to fill in the gaps in your first SaaS solution. 

While custom software is a large up-front investment, it might end up costing you less in the long run and bring better results. How can you tell? Look for a few telltale signs:

• It’s hard to find a SaaS vendor that matches at least 80% of your needs.

• You have the time it takes to develop an MVP.

• You are in a sensitive or highly competitive industry.

• You need a competitive advantage and software could help you gain one.

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Do You Need Custom Software? 

See if your business could benefit from custom software.

 

See how Far Reach has helped clients make the buy vs. build decision and implement solutions. 

• 

  READ

  Build or Buy? A Software Consulting Case Study

• 

  READ

  Pros and Cons of Custom Software Development

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  READ

  Best of Both Worlds: Custom Portals

You don’t have to make this decision on your own. A consultation session with our experts can shed light on any questions you may have. 

We can help you uncover the best approach—the one that can fuel your company’s goals. Let’s talk. No obligations and no strings attached.