In-House vs Off-The-Shelf Software Investment

Build it or Buy it?

Time and time again, business leaders debate whether to build or buy a software solution to solve the many problems they face. This is especially apparent in the higher education sector where there is access to a large pool of talent, and the potential resources to achieve a bespoke solution. The Project Management Insitute’s latest report reignites this debate.  

The report shows that 33% of IT projects fail, with budget lost, while 36% go over budget and 25% do not meet the original goals set for the project. These figures point to the challenges associated with in-house software development and call for another assessment of the pros/ cons of building solutions compared to buying them. 

The Challenges 

Three of the main challenges facing in-house software development include scope, capability and time. 

Scope 

Maintaining a distinctive project scope and objective can be difficult as demands are raised by competing departments. Building bespoke software can mean that everyone wants their say in what the software should do, often outside of the realm of realistic, affordable possibility.  

Capability 

The challenge of capability most often comes down to the resources and budget available for the project. From a cost perspective, it is difficult to compete with off-the-shelf solutions, which are built by a specialised team for a singular purpose. The fact that an in-house team not only have to create the software but also maintain and upgrade it indefinitely, adds additional resource and budget considerations. 

Time 

Another major challenge for in-house software development projects is time. Defining the project scope and objectives to successfully implementing and running the solution, can take years from start to finish. Many in-house projects encounter obstacles and headaches along the journey that slow down progression and the result is massive delays to solutions that many teams need urgently. 

In-house vs off-the-shelf software development

 

To confidently decide if you should build or buy, let’s break down the advantages and disadvantages of each: 

In-House Development 

Pros 

Cons 

  • Ownership of the solution 
  • Customisation to meet specific requirements 
  • Complete control of development 
  • Built with integration of existing systems in mind 
  • Potential competitive advantage 

 

 

 

 

  • High risk of failure 
  • Massive upfront costs 
  • In-house developers may lack the knowledge to create software capable of handling all the tasks required. 
  • In-house team may lack the skills to complete the project on a tight schedule 
  • Bugs and glitches may lead to outside consultancy 
  • The system may not be scalable 
  • An over reliance on one department over another 
  • Technological trends may reduce impact of development 
  • Maintenance costs 
  • Risk of data breach or cyber attacks

 

Off-The-Shelf Investment 

Pros 

Cons 

  • Tried and tested  
  • Highly skilled and experienced software developers 
  • High functionality 
  • Solution already available that meets your objectives 
  • Quick implementation and use  
  • Round the clock support and training   
  • Part of a community that assists in enhancing future output  
  • Protection against security risk 
  • Institution will never own the rights to the software  
  • Risk of the vendor not updating solutions in a timely manner  
  • Potential for integration issues 

 

 

 

The conclusion 

The weight of the pros and cons for each option will be different depending on your institution and their particular needs. Very specific software requirements are often the biggest motivation for building an in-house system, despite the many challenges associated with it. For the best option, institutions should look for an off-the-shelf solution that offers them high levels of customization. This may address all the requirements of an institution specific solution, without all the additional headaches. 

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