In today’s competitive market, enterprises must address business challenges effectively and efficiently to stay relevant in their field. The easiest way to solve any business challenge is to look for a readily available solution (Commercial Off The Shelf) or consider custom software development. For any enterprise, the choice between purchasing a COTS software or building a custom solution is always a daunting one.
In most of the cases, a plug and play COTS solution looks tempting – a business-ready system with a seemingly lower investment, even if the decision is made with long-term thinking in mind. Some SaaS Solutions require as little as the purchase of a user license. Other vendors quote attractively low prices thanks to their cost-reducing models. All of this does make COTS solutions look like they could be the answer, but industry experts argue that they’re not always the best way to go when it comes to the IT landscape your company needs to have.
Here are some key factors you need to keep in mind when you are faced with the task of choosing between custom software development and COTS:
- Flexibility & Customizability
COTS solutions usually come with a fixed list of features that cannot be changed based on your specific requirements. This might work well if you’re from an industry that has rigid processes, where no deviations are tolerated and where supplier solutions need to support the standards of your industry – Pharmaceuticals, for instance. But if you are looking to automate a business process or a customer-facing application, you need to deviate from standard practices, because your needs are unique to your business. Trying to have a COTS solution customized often results in a very buggy application that can have irreparable consequences on your business – the rigidness of a COTS solution makes it almost impossible to comply with what the business wants.
- The Support Model
Most COTS solutions have fixed support models, and the procurement team will have to evaluate their support structure on many criteria – warranties, SLAs, ownership costs, hidden costs, etc. It is a messy but imperative process to dissect their support model and try and negotiate to make it align with what your business needs. Especially for mission-critical applications, it becomes essential to have support with strict SLAs to ensure the system always works flawlessly. This might mean they need to tweak their support model, which may be something they cannot provide, especially if they outsource the support entirely.
- Integrability With Existing Systems
COTS solutions are usually built based on the standards and trends of the industry they want to operate in and the tech stack their potential customer base is using. Their roadmaps are often based on parameters such as customer feedback, industry analysis and trends they hope to monetize on moving forward. This means that the solution doesn’t always have to run in your specific IT landscape.
For example, your business might rely on Software X to complete one task and Software Y to finish a second one. You need to ensure that the system being procured is compatible with this existing ecosystem. If the solution you are using hinders the two from communicating effectively, it will affect the overall efficiency of your operations. If you were to build a solution, however, a wider set of APIs from different software and data partners could be integrated to ensure seamless functioning. Moreover, it’s always a hassle to try and get support from different vendors to develop APIs specifically for a project.
- Effectivity of Change Management
Buying a COTS solution often results in your business having to change its internal processes in accordance with the newly procured solution as COTS solutions are built based on standard practices within your industry, which might not be what you follow. This can turn into a costly, time-consuming affair that could have been avoided if you had chosen to improve your efficiency by automating your existing product by building an automated layer around it.
- Risks To Data Security
Many software services, especially SaaS providers, follow a shared model to bring down costs – this poses a data security risk for your business. The vendor might not have used the best practices for security vulnerability testing (OWASP top 10 or SAN top 25), and the risk is amplified when you integrate it with other systems, exposing your entire infrastructure to those vulnerabilities.
- Compliance With Industry Standards
Many industries, especially highly regulated ones like FinTech or Healthcare where even a small deviation from standard procedures can impact whole societies, have strict standards to maintain the quality of their services. If you own a business in these industries, you have to be extra vigilant that the services you buy comply with these strict standards, and that can result in a very complex buying process.
While COTS solutions made specifically for these industries will most likely adhere to these compliances because they are contractually bound to do so, they usually work out to be extremely expensive. If spending a lot on your operating process isn’t ideal for you, it is much more efficient and budget-friendly to build an application around your existing manual process.
- Financial Investment
COTS solutions end up being more expensive in the end in the form of customizations, and premiums paid for high-end software upgrades or the hardware investment made for setting up an infrastructure for systems and sometimes the support costs. Though the cost associated with custom build solutions seems high during the initial phase, in the long-term, they are more valuable than a COTS solution.
The choice between custom software development or a COTS solution varies from case to case. It is a decision that needs to be taken factoring in all the variables that will affect your business. Both have their advantages and disadvantages. Custom software development, however, tends to be easier, less risky, and provides the best ROI, if you find the right technology partner like Experion technologies. We have built custom software solutions for enterprises of different industry verticals across the globe. Our business customers quickly transformed to be long-term partners, as we delve deep to understand their business, and delivered long-lasting and effective solutions.
Check out this article – 8 Factors To Consider While Outsourcing Your Custom Software Development Requirements for more inputs on this crucial deliberation.
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