BUILD vs BUY for software vendors and implementers

Familiarity with the data, procedures, and workflow within an organization. In-house staff have already been through the onboarding process and are already aligned with the organization’s mission, goals, and processes.

Compliance and consistency. Internally staffed activities can be easily monitored to ensure compliance and consistency within organizational standards.

Additional service revenue opportunity for implementers. Some vendors and implementers are interested in providing this additional service to their customers and have the resources to staff the work.

Control of the approach, the technology, and code. Access to the code-base, understanding how it works, no learning curve, any underlying assumptions are addressed.

Availability. Internally-sourced skills are readily available on-hand to deal with any maintenance, upgrades, troubleshooting, or changes.

Higher cost. Employee salaries, along with benefits, equipment, and training, cost more overall. Actual costs are often unforeseen and unintentionally hidden in various cost centers throughout the organization. 

Takes longer. Staff are often hired to take on a variety of tasks and projects, and fewer hands may be involved in getting the project done. As a result, each project’s progression can be slower.

Insufficient skill or resources. An organization may simply not have or be able to staff the skilled workers required to implement and manage application integration.

Staff retention can be challenging in this field. The demand for employees with specialized technical skills is increasing, and companies are seeing a migration of skilled employees who are being recruited by large corporations.

Management and maintenance of the integration must be addressed with a service agreement. Updates may be needed frequently. There is reputation risk if your integrations require customers to amend their workflows in order to function.

Requirements from customers may be vague which can lead to budget uncertainty, risk to estimated timelines, and project delays.

Financial risk may attach to you if customer financial reporting or compliance activities are reliant on the integration.

Time-efficient. The job can often be done quickly, as teams have established workflows, specialized skills, and experience. 

Lower cost. Companies who specialize in application integration have a well-established workflow, existing tools or platforms, and can efficiently manage resources to provide value.

Expertise. All business activities of an integration software or services company are focused on building the integration platform and supporting services. They know the ins and outs of the process, and have the experience to deliver products that work for their customers.

Optimization. The solution is tailored to the customer’s needs.

Customer concerns are easily addressed in contract terms and conditions.

Passing control to an outside party is a perceived risk due to data sensitivity and unfamiliarity with internal processes.

Alignment of values. An external organization has its own mission and values, which may not fit in terms of customer focus, project priority, or general culture of staff.

Third-party dependence is inherent. The efficiency of the customer’s operations rely on the continued existence of the third party’s business and relationship with the customer. 

Licensed solutions may require additional reorganizing of data processes.

Financial risk may attach if customer financial reporting or compliance activities are reliant on the integration.