Is it better to build or buy software off the shelf? In today’s world of digital transformation, companies are increasingly recognizing the importance of efficient software solutions.
In this blog, we aim to shed light on the key distinctions between building and buying software. Drawing from our experience as software developers, we hope this will give you insights to empower you in making an informed business decision.
Software solutions have a huge impact on how well an organization performs. They make things run smoother, help people work faster, and meet the changing demands of customers and internal teams.
When it comes to adopting software, every organization faces a crucial decision: should they opt for off-the-shelf, ready-made software or embark on the journey of developing tailor-made software solutions that align precisely with their unique demands?
According to statistics by Statista, companies’ information technology spending on enterprise software worldwide is expected to exceed USD 856.03 billion in 2023.
With mounting pressure to build better software faster, a WSJ article predicts that nearly two-thirds of all companies will be software producers by 2025 to cater to this increasing demand.
Although developing a tailor-made software solution in-house may initially appear as the optimal approach to tackle a particular business challenge, it frequently demands a disproportionate allocation of resources, particularly in terms of budget and personnel, for the creation, implementation, and maintenance of the software.
In contrast, collaborating with a reputable vendor to deploy a proven solution often proves to be a more efficient alternative.
This approach enables companies to expedite the technology’s availability to users and ensures comprehensive support throughout its entire lifecycle but limits the potential to extend the usability of the software strictly to the vendor’s product roadmap. Let’s dive deeper to understand the pros and cons of both approaches.
When choosing the buying approach for software solutions, companies can enjoy several benefits that come with ready-made options. Let’s explore the advantages and also the challenges that might arise:
|Pros of Buying Off-The-Shelf Software Solutions
|Cons of Buying Off-The-Shelf Software Solutions
|Immediate availability and quick implementation
|Potential lack of customization
|Reduced development time and costs
|Integration with existing systems
|Rigorous testing and reliability
|Ongoing updates and support requirements
|Includes unnecessary features
When opting for building software internally, companies can enjoy several benefits that come with creating custom software.
Let’s explore the advantages as well as the considerations and potential drawbacks:
|Pros of Building Tailored-Made Software Solutions
|Cons of Building Tailored-Made Software Solutions
|Tailored to specific business requirements
|Time and resource investment
|Seamless integration with existing workflows
|Specialized expertise and development challenges
|Increased efficiency and productivity
|A competitive advantage over your competitors
The hybrid approach to software solutions started to gain traction recently and it involves combining off-the-shelf, ready-made software with custom software to strike the right balance for your organization.
In a study done by Rackspace with 1870 total respondents from the top leadership in tech, one of the key findings is that there is a shift to strategically balance both approaches of build vs. buy software.
The study indicates that tech leaders do not want to spend valuable developer resources building and maintaining applications that won’t significantly set the brand apart. The prevailing trend leans towards opting for buying software solutions whenever feasible while adopting the increasingly popular low-code code development platform for building business-critical applications for maximum flexibility.
This choice aims to achieve a higher Return on Investment (ROI), enhance efficiency, and improve user-friendliness. Additionally, it allows organizations to optimize their resources by freeing up in-house talent to focus on building applications that can deliver more significant impacts on the business faster using low-code solutions.
“56% of Organizations Build Applications In-House To Gain a Competitive Advantage”Rackspace Whitepaper: Build or buy 2020
“65% of Applications With Be Built Using Low Code by 2024”Able Platform: Why low-code development is becoming so popular
In summary, the landscape of software solutions is witnessing a dynamic shift, where both build vs buy approaches play significant roles in meeting the diverse needs of businesses.
Undeniably, there is a growing trend towards the “build” approach, as businesses recognize the value of tailored solutions that precisely align with their unique requirements. Building custom software also offers the potential for a competitive edge, enhanced efficiency, and the ability to address specific pain points effectively.
Moreover, the increasing availability of low-code platforms has accelerated the development process, enabling organizations to build applications faster by reusing prebuild components. The current trend towards adopting a mixed strategy demonstrates the recognition that there is no one-size-fits-all solution in the software realm.
The decision to build custom software or buy off-the-shelf systems should be driven by a thorough evaluation of the organization’s unique needs, long-term goals, budget, and available resources.
Now that you’re informed of the different pros and cons, you are faced with the crucial choice of selecting between building and buying software solutions, you must approach the decision-making process with care and foresight.
Here are 6 essential considerations to get started:
The choice between building or buying software solutions is a critical decision that can have lasting impacts for years to come. It is essential to approach this decision with a focus on the long-term consequences, availability of resources, urgency with which the solution is required, and an assessment of how critical the system is for your business.
If you are looking to replace legacy software, rapidly build crud apps, or online database apps you should explore Five low-code IDE. Join the hundreds of other software developers who are already using Five to build customer-facing and internal teams-facing web applications, modernize legacy applications, and many more. Get started with a free download of Five now!