Written by: Souki Fournier
Whether you are leading an innovative tech company or managing the digital division of an organization, there is one dilemma that you surely have come across at least once: when needing a software solution, should you invest in a market-ready product or should you build it yourself using your IT resources? This is also equally true when it comes to behavioral science work. Should companies seek out thoroughly developed software solutions by subject matter experts? Or should they build their own?
The dilemma you, along-side numerous organizations around the world are faced with is also known as Build vs Buy.
Identifying the Need
As you weigh in on the decision of buying a software solution vs building it, you need to start by assessing your need, identifying the issue you are trying to address, and do an inventory of your resources. Opting for “Build” or “Buy” can only make sense if it is a well thought out decision that takes into consideration all variables involved.
What is the problem you are seeking a software solution for? What purpose does it have? Is it meant to improve your business process, or optimize your operations? Does your in-house IT team have the knowledge and the capabilities of building such a solution? Do you even have IT resources, to begin with? If not, can your company afford to outsource such task?
These are all the questions you need to ask yourself when faced with the Build vs Buy dilemma.
Weighing Your Options
Opting for Build or Buy can only make sense if it is a well thought out decision that takes into consideration all variables involved. What is the problem you are seeking a software solution for? What purpose does it have? Is it meant to improve your business process, or optimize your operations? Does your in-house IT team have the knowledge and the capabilities of building such a solution? Do you even have IT resources, to begin with? If not, can your company afford to outsource such task?
From a behavioral tools perspective, the ramifications of building a solution from scratch are often costly. There are so many companies that have created new FinTech, HRTech, and MarketingTech behavioral solutions, and have failed after the first year. With a behavioral tool, you are only as good as the insights you provide. Generating accurate insights, quickly, and reliably takes a lot of research, finetuning, and time. Companies who do not operate in this field, are typically ill-equipped and unable to access the resources in order to create solutions from scratch.
Maintenance and Support
It is undeniable that having an IT department in your company is a substantial asset when it comes to running your operations smoothly. Having an on-call team that can proactively maintain your software solutions and provides unlimited support is the main appeal in investing in IT resources, to begin with. When opting for building your own software, your in-house IT team has full control over the process and is able to provide unlimited support. Whereas when you buy a market-ready product, your software vendor may not have as much of a proactive maintenance team, and it might take longer to have your support ticket processed. However, the perks of buying a software solution reside in the market reach of the vendor that grows exponentially which entices him to use his client’s feedback to develop his software, anticipate any bugs that may occur, and continuously expand his product features. Your IT team, however, unless an issue has risen they may not be as proactive in developing your software solution.
Return on Investment
No matter what industry you operate in, the concept of ROI is pretty straightforward and applicable to all: as an organization, you strive to generate high returns on your investment. This means that ROI is not only a metric to evaluate the success of your business decisions, it also dictates funding and resource allocation. That is a key element to take into consideration when faced with the Build vs Buy dilemma. Let’s look at it this way: if a firm needed an accounting software, they would rarely build their own. They would simply license software from Oracle, Quickbooks, or any of the other providers who have solutions, off the shelf. The truth of the matter is, companies such as Oracle have put thousands (millions?) of hours and have recruited top-notch experts to build their platform. To put things even more into perspective, our very own DNA Behavior solutions are available for as little as $75 per month but we have invested hundreds of man-years developing the insights with PhDs and experts from high-ranking government, private sector, and military positions. For you to replicate one of our products, it will cost your company $20 Million over 3 years.
Could your company commit to such investment? Does your ROI justify and support such expense? At this point, if you are still hesitant or unsure about which direction to go and whether you should Build or Buy, looking at it from your ROI perspective should tip the balance.
Did you know that even the most brilliant and resourceful tech companies around the world purchase software solutions from other vendors? That’s right, when needing a software solution for business processing or operation structure, they may have the capabilities and resources to build them, but their resources are much better invested in their field of expertise rather than gaging a foreign technology landscape that they know nothing about. So why would you try to build your own behavioral software where companies such as DNA Behavior exist? We have spent the past 19 years generating 575 behavioral insights that have been tested, improved, and are ready to use. You can now leverage our Financial and Business DNA retail packages as well as our Financial DNA API, with the possibility of co-branding or white labeling our solutions. The fact of the matter is, your resources are better used to help your company grow rather than investing in building a software solution you lack expertise in.
If you’re still not sure, schedule your 15 min consultation with Leon Morales, our Managing Director to further discuss our products and solutions.