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Tradeoffs on buy vs. build

August 29, 2008 2 Comments

My newest Baseline column is up, talking about the dilemma faced in deciding whether to acquire software or build it yourself:

The other day, an IT colleague of mine mentioned a conflict at a corporation where he’s working. The corporation has a mission-critical application deployed across a large number of workstations. The set of corporate employees who use this application largely use it and nothing else all day long at dedicated workstations. The application they are using is a customized third-party application; however, the firm has been having chronic problems with this app (let’s call it “QRSApp”), and so is looking at different solutions. The firm could continue to make changes to QRSApp to fix their problems. The firm could switch to a different third-party application; several other vendors market applications of this type within this firm’s industry. Or, as a senior IT manager now wants to do, the firm could develop a completely custom and private application to replace QRSApp, so that the firm has complete control over it.

The question: which solution is best?

Comments are welcome.  ..bruce w…

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About the Author:

Webster is Principal and Founder at at Bruce F. Webster & Associates, as well as an Adjunct Professor for the BYU Computer Science Department. He works with organizations to help them with troubled or failed information technology (IT) projects. He has also worked in several dozen legal cases as a consultant and as a testifying expert, both in the United States and Japan. He can be reached at 303.502.4141 or at bwebster@bfwa.com.

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  1. aquraishi says:

    Choosing either solution based on what we know in this post would be sub-optimal to say the least. Here are some questions I’d like answered before making a recommendation: What’s driving its need? How strategic is the application? What are the costs of acquisition and ownership of the two (buy vs. build)? Which functions are fulfilled by the 3rd party one and more importantly which aren’t?

    Do a business case before you jump ahead. Get a list of requirements from your customer. Match them with the 3rd party stuff. Even a simplified approach is better than nothing. Give it to a junior staffer so they’ll learn how to do this on bigger projects and will ove you for the opportunity. This makes certain you’ll chose what the customer wants and will get you the management support for doing it.

    My 2 cents…

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