Custom software or off-the-shelf: how to decide

Sooner or later every organisation has to decide whether to buy a ready-made product or have software built for it. Both can be the right call. The expensive mistakes usually come from comparing the wrong things.

Start with your process, not the feature list

Compare feature lists and the ready-made product nearly always wins, because it lists far more than any one customer will use. A more useful question is how closely your way of working matches the way the product expects you to work.

Every off-the-shelf product is built around an idea of how the work should flow. If your organisation already works that way, you get a lot of value quickly. If it doesn’t, the difference has to go somewhere, and it usually ends up in one of three places.

1. You change your process to fit the product. Sometimes that is a good thing, since standard processes exist for good reasons. Sometimes it removes the very thing customers chose you for, and nobody notices until much later.
2. You customise the product. Light configuration is fine. Heavy customisation adds the maintenance cost of custom software on top of the licence fee, and every upgrade turns into a small project.
3. You work around it. Spreadsheets, manual steps and side tools grow up around the product, and the gap becomes a running cost that was never in the original budget.

When buying makes sense

• The process is standard for your industry: accounting, payroll, email, basic HR.
• It isn’t where you compete.
• Getting started quickly matters more than a close fit.
• You are comfortable with the vendor deciding what the product does next.

When building makes sense

• The process is part of why customers choose you.
• No product fits without heavy customisation.
• The system has to work closely with the systems you already run.
• You need control over the data, the roadmap and how quickly things change.

Most organisations end up with both

In practice, most companies buy the standard parts, build the parts that set them apart, and connect the two. How well those connections work often decides whether staff find the whole setup easy or painful to use, more than the mix of bought and built.

Questions to answer before you decide

• Where exactly does the product differ from how we work today?
• Is that difference something we should protect, or a habit we could drop?
• What does each option cost over five years, counting licences, customisation, maintenance and integration?
• Who owns the data, and how hard would it be to move away later?
• How would the vendor’s plans for the product affect ours?

Working through these questions takes a clear picture of how your organisation actually runs, and that picture is useful whichever way you decide. If you would like a second opinion on a decision like this, we are happy to talk it through with you.