Build or Buy? A Smart Guide to Choosing the Right Tech Solution for Your Business
Key Points
- Timing Matters: Decide how quickly your business needs a solution—off-the-shelf software can be faster to deploy, while custom tech requires more time.
- Understand Total Cost of Ownership (TCO): Compare the short-term affordability of off-the-shelf solutions with the long-term value and predictability of custom-built technology.
- Plan for Scalability and Maintenance: Choose a solution that aligns with your growth goals. Off-the-shelf can be easy to scale but limited; custom builds offer more flexibility but require more in-house upkeep.
Chances are, you depend on technology to run your business.
Whether you subscribe to various Software-as-a-Service (SaaS) solutions or manage your own on-premise infrastructure, it would be hard to keep your organization running smoothly without the technology that supports it.
However, as your business needs change over time, you may wonder if you’re really getting full value from off-the-shelf technology solutions.
In these cases, building your own custom solution might be a better option for your business.
But before you decide to build or buy tech, consider a few key factors that can help you make the right choice for your business.
Decide How Long You Can Wait
Timing is everything for your business.
This applies not only to when and how you execute your sales and campaigns but also when you decide to make larger investments in your company infrastructure—like whether to build or buy tech.
When you’re looking to solve a quick problem or implement temporary solutions, an off-the-shelf solution is often a great way to go.
Typically, these types of tools have a lower barrier to entry and are designed to integrate relatively quickly into your existing tech stack.
If you’re wanting a longer-term solution in place, you’ll need to consider how long your business can wait for it.
While it could be the better solution for you in the long term, your immediate business needs will play a factor in your decision to build or buy.
Assess Your Team’s Expertise
Anytime you’re considering making a larger technology investment, it’s important to think about who will be using it regularly.
Not all software solutions are built for beginner users or are able to provide full value to each of your departments.
This is why you should always assess your team’s technical capabilities before deciding to purchase or build your own solution.
Another thing to consider is who would be involved in an in-house development project.
If you decide to build and implement your technology, understanding the time and resource commitment from each team member is essential.
If you don’t have the necessary skill sets internally to handle a larger-scale software development project, your other options would be to outsource a team for the job or stick with a ready-made product.
Calculate the Total Ownership Cost
One of the most important factors when deciding to build or buy your own tech is your budget.
Not different than if you decide to take on a home renovation project, getting a full picture of your total potential costs is key before you decide to move forward.
Off-the-shelf solutions are typically designed to be more affordable up front.
They are usually built as monthly recurring costs and can have multiple pricing tiers depending on the features needed.
However, depending on the product, you could be required to lock into a specific period of time.
You also don’t have control over how pricing might change moving forward, which means that after a certain point, you may be paying more for a solution long-term that only offers you a certain amount of value—making you question whether to build or buy tech is the smarter move.
Depending on your needs, building your own solution can cost you much more upfront.
However, while these initial costs are typically much higher than those of off-the-shelf solutions, you’ll likely make back this value over time and have much more predictable maintenance costs.
All of these factors should be considered when calculating your total cost of ownership (TCO).
This calculation should be weighed against your short- and long-term business budgets to help you choose a viable option for your business.
Forecast Your Scalability Needs
Scalability is another important consideration when deciding on the best ways to establish your business infrastructure.
Over time, your business will evolve based on industry changes and customer needs. It’s important to make sure your technology can keep up.
When deciding between off-the-shelf solutions and custom products, each has its pros and cons in terms of scalability.
Most SaaS solutions make it easy to add or remove users and may have a variety of add-on features you can subscribe to based on your needs.
However, most are designed to cap resources after a certain point.
When this happens, you’ll either need to wait for their development teams to come up with a solution or search for a new solution that’s better suited to your needs.
With a custom-built solution, your business is entirely in charge of how much or how often you develop the product.
But since the solution is designed specifically for your own needs, you’ll be able to improve or adapt it as much as you need moving forward.
This means you’ll typically get much more shelf life out of the product before needing to adopt newer technologies.
Confirm System Compatibility
Even the best-sounding features of a new piece of software won’t bring you much value if the solution doesn’t mesh well with your current tech stack.
Even if an off-the-shelf product works well on its own, if the system doesn’t have seamless integration capabilities with your other systems or databases, it can cause more problems than it solves.
Before making any type of investment, it’s important to evaluate your current business systems and ensure the solution you’re bringing onboard has the compatibility you’re looking for.
This can sometimes be one of the downsides to off-the-shelf solutions, since they are usually developed for a specific target audience and only prioritize integrations that suit their specific needs.
When you build your solution, you have complete control over which integrations it supports.
However, it can also take much more time and require a significant amount of testing to ensure each tool communicates with each other the way it should.
Plan for Ongoing Maintenance
Because business technology is dynamic, it’s important to remember that any software solution you have in place needs to be maintained or improved over time.
Whether you decide to handle this in-house or rely on a third party, this should be another consideration you make before deciding on a path forward.
When using a third-party solution, they handle all the upkeep and ongoing maintenance.
This can be pretty convenient, especially for smaller businesses that don’t want to worry about the ongoing hassle of ensuring their technology operates properly.
However, there is a caveat to this as well.
Since you’re relying more heavily on an outside partner to keep the systems your business uses up and running, you have less control over when and how these updates are managed—prompting questions about whether to build or buy tech might offer you more control.
This could mean you experience more downtime than your business can handle.
When you build your own custom solution, you’ll need to manage all the required maintenance on your own.
However, this can be a better solution for some businesses that want to minimize the risks of leaving this process to an outside partner.
The good thing about this format is that it’s similar to making custom improvements to your home.
You’ll have complete control over which features you focus on and what areas need more work than others.
Make the Right Choice for Your Business
Deciding to purchase or design your technology solution is an essential decision for your business to make.
By considering the points discussed, you’ll be sure to choose the right path forward that helps your business achieve its core objectives while staying within budget.
