Should Your Business Build or Buy New Tech? It Depends.
In a recent Forbes article, I answered a question every business faces at some point.
Should we build or buy new tech?
The short answer is… it depends. To find the right route for your company, you must ask yourself the right follow-up questions.
First, can this solution scale with our expected growth and unique business processes?
Typically, an out-of-the-box solution can only handle so much. When a technology tool is unable to scale to support your business’s growth or unique processes, it can backfire. The outcome is potentially a rigid, slow and less-than-effective solution.
It’s a given to ensure a system can handle your expected user and data volume, but you should also consider future growth and peak usage when evaluating an off-the-shelf solution. For example, an e-tailer shouldn’t just consider the average business day, they should consider peak traffic days like Black Friday or Cyber Monday. Will the tech solution hold up on those days as well?
What often falls through the cracks is the system’s computational power and administrative scalability. Before purchasing a SaaS product, you need to know if the solution will have the computational ability to crunch the amount of data it will receive now and into the foreseeable future. Additionally, if the system is too rigid to accommodate your complex business processes or the UI is too cumbersome, the solution could lead to administrative inefficiency that limits agility.
Second, is this solution flexible enough to keep up with our industry’s speed of change?
Purchasing a prepackaged solution can potentially increase your organization’s agility. At least, initially. In ideal situations, implementing an off-the-shelf product takes less time than it would take to build a custom solution.
However, it’s essential to take a long-term view when evaluating technology investments. When you buy versus build, your business is at the mercy of the provider’s release schedules. If a SaaS product has a track record of releasing updates or enhancements infrequently, your ability to be nimble will be limited.
While competitors who choose to go custom can innovate and respond to customer demands immediately, you’re stuck waiting on the next software update. If “going custom” allows your business to keep pace with customer demands, the initial investment of time will be well worth it in the end.
Third, will our new tech solution increase rigidity or alleviate it?
Agility remains a significant competitive advantage in today’s dynamic marketplace. When evaluating future technology investments, technology executives must ruthlessly evaluate if a solution will increase rigidity or alleviate it. If your current technology encumbers your ability to be nimble, it’s probably time to build something new.
While these questions are a great starting point for determining whether building or buying is the right tech solution for your business, Artisan helps companies of all sizes determine the right path forward. Contact us if you’d like to discuss how to make tech work for your company and its future growth.
