Custom Software Versus Off The Shelf Software

The buy or build decision depends on your business and how unique its processes are.  If your business wasn’t unique in some way, then everyone else would be doing what you were doing.  You would be struggling badly with competition.  Some processes are common to many businesses, such as payroll and VAT.  These are standard processes, so demand a standard commercial off the shelf solution (COTS) to provision them.

All businesses could benefit from automation.  What would that save you in time and error reduction?  Imagine the guarantee of quality, the speed and simplicity?  A custom software solution is in most cases the only solution, but there are associated costs, and you would not want to customise everything.

There is a view that custom software is more expensive than licensing COTS.   At first glance it would appear that way.  However, it depends how you compare.

Binary-CityA rich COTS application, which is highly customisable and powerful, sounds attractive.  Usually you would pay an implementation fee, a license fee (usually per user), and an ongoing support and maintenance package.  You will have to adapt your processes to follow those built into the logic of the software.  The custom case is to commission a project to fulfil your processes exactly as you need them.  Compare the two options.  List the feature coverage against your requirements.  Look at the return on investment (ROI).  Which pays back quickest?  Are there secondary benefits?  E.g. reduced paper, reduced staff costs, better reporting, simpler to use, less training needed.

For a custom software solution you need a supplier with domain knowledge or experience in your sector.  Ask for a rough order of magnitude (ROM) cost for a list of requirements.  Make sure to ask for the warranty conditions.   Ask for a separate quote for a maintenance and support or service management contract.  Check you will own the Intellectual Property (IP) of the software, and when the source code will be given to you.

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