In any organization, exploring new systems or processes to create efficiencies is paramount to a company’s long-term growth. However, when it comes to investing in new technology, it can be challenging to find a solution that fits exactly with the unique needs of your business.

Understanding whether you should begin the lengthy process of creating an in-house technology or start searching for an external vendor is not as straightforward as you might think. Once you have clearly defined the requirements for your software, there are several major factors to look at before you can proceed one way or another. To help you make that decision, we’ve put together a list of the main considerations you should assess when deciding if your organization should build or buy its next software solution.

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What's your timeline?

Question to ask: Can you wait several months to a year to use your software, or does your problem need an immediate solution?

Creating a solution from scratch can be a slow process, taking a dedicated team multiple months to build and then implement. To further complicate matters, large in-house IT projects are notorious for encountering delays in execution and exceeding their anticipated timelines and budgets. This means, that If you are in need of an immediate solution, buying a third-party software is likely a better option. Not only will this speed up deployment, but it will give you a concrete timeline to work with that you can integrate into your strategic plans with confidence.

How much are you willing to spend?

Questions to ask: What kind of capital do you have to invest in this project? Are you working with a lumped annual budget or do you need a solution with low upfront costs?

Building a custom solution can seem like a more cost effective option, especially if you have the talent needed to build the technology in-house. However, while the upfront cost might be lower, over time the additional cost of building and maintaining a custom software could exceed the total cost of buying a premade solution. Another element to consider is that custom software is not always as effective or easy to use as originally imagined. Oftentimes, companies will begin an internal software project, and after months of wasted effort, find that they still need to turn to an external vendor for a working solution.

Do you have in-house knowledge?

Questions to ask: Does your organization already have the knowledge in-house required to embark on such an extensive project? Who will be in charge of managing the deliverables?

Whether you assemble a team internally or outsource the project to an external vendor, resourcing is a huge consideration when undertaking a custom build. If you work at an organization that has a large enough IT department, they may already have the capabilities needed to build a custom software solution. However, you will still have to put together a resourcing plan to backfill the everyday tasks they set aside to work on this new project.  Alternatively, if your team does not have the skills needed to build the kind of software you are looking for, you will have to weigh the cost and time it will take to onboard new employees or outsource to a software development company.

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How will you maintain the software over time?

Questions to ask: What is your ongoing support and maintenance plan? Who will be in charge of updates and bug-fixes?

Once your software is built and ready for deployment, your need for a technical team does not end. Software requires ongoing maintenance and updates to keep it functioning properly. Not only will it need updating to ensure it meets the evolving needs of your team, you will also have to develop new versions to make sure it continues to be security compliant and compatible with the other systems you have in place. This type of support can be difficult to maintain with an internally built software. On the other hand, dedicated support is a fundamental focus and service offering for external vendors, meaning the burden of maintenance lies with them.

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Do available market options suit your needs?

Questions to ask: Is there a similar solution already available on the market? Is it possible to collaborate with a provider and get custom built product features?

One of the biggest reasons organizations choose to build their own software is because they cannot find one on the market that meets their exact needs. However, what many people don’t realize is that great software vendors will have the support and technical skills needed to build customized integrations or solutions. If a product exists that solves most of your requirements consider collaborating with that vendor and exploring what they can do to help fill in the gaps. You can also consider integrating multiple systems that handle separate functions to deliver the capabilities you are looking for.

Ultimately, the decision to build or buy a software solution includes many factors that will impact each organization differently. That being said, it is important to remember that this decision should be based on more than just product offering, as the full scope and impact of building a new technology takes a great deal of planning and foresight.