In today's market there are solutions in all forms catering for
all needs and as Boards and Directors drive their businesses
forward to increase efficiencies and simplify their business
processes, IT departments are left to solve the problems with a
limited pot of cash and endless number of decisions to make, which
can often lead to projects running over time and over budget.
The first and foremost decision to contemplate is whether to
have a bespoke
solution developed or would an off the shelf package live up to
the task in hand. However before you put pen to paper and
commission a supplier to carry out your chosen option a few issues
must be considered by either solution.
Bespoke Solutions
In an ideal world all systems for all organisations should be
tailor made to the needs of the individual business or department
as the software can fully integrate to the business objectives.
Scalability is also a plus factor with custom solutions, by having the
option to either upsize or downsize the system depending on the
growth of the business, which means that evolution of both the
business and the system can happen in synergy but without
additional licensing costs. This is due to the fact that companies
that commission bespoke solutions take into consideration the long
term IT plans rather than sourcing a quick fix solution, ensuring
that they can move forward with ease rather than being limited by
their internal systems.
Intellectual Property
Rights (IPR) are another contributing factor to developing
bespoke solution as many suppliers hand over the rights of their
software on completion of the project. This means that the buyer
has the freedom to do what they like once the system is functional
and need not be tied in to a lengthy contract.
Bespoke solutions sound perfect but do have a few factors
stopping everyone rushing out and filling the order books of their
local custom software developer.
The first and foremost reason is that bespoke solutions can be
considerably higher in cost than the packaged software, as the
systems have to be built from ground up and individual to each
project. This means the initial outlay in resources is much greater
as teams of experts such as analysts, project managers, developers
and testers are all required to bring the software to life. With
high investment so early on in the project the ongoing cost and support should be
lower over time and the software will replicate the business needs
more closely so should deliver a better return on investment.
Another common ongoing benefit of bespoke software is that the company
should own all the IPR which could then be packaged and sold on
to other businesses to become another revenue stream for the
organisation.
A major limitation could come in the requirements set out
originally by the contracting company. If the requirements haven't
been properly specified then the software can only match these and
is unlikely to fulfil your actual needs, as this will be all the
developer can work too. This takes you back to the reason why
investing at the start can help reduce long term problems, as the
development company will provide analysts to work with you to
ensure the specification is clear and meets all the requirements of
the business process. This process can also produce further
processes that may have been overlooked in house and ultimately
improve the final system.
Off the Shelf/Packaged Systems
As the name suggests off the shelf software products/packages
are already built based on generic needs of an industry and so you
can purchase a packaged solution based on an acceptable match
between your requirements and the common functionality and
procedures provided. A lot of packaged systems were once in their
lifecycles a bespoke solution of one kind or another, but as demand
grows for similar solutions across a broad market, then the best
and most common requirements for the varying solutions are put
together for a one-size fits all model and then marketed to the
individual sector.
Generally these systems are easy to install and all the teething
problems (bugs) that might be associated with a bespoke solution
will have been dealt with way back in the original development.
Therefore unlike bespoke systems they require less initial outlay
in terms of time commitment from your team so on the whole they
work out cheaper. Besides price and easy installation they are also
designed for ease of use, so new users can find it easy to adapt
and change their ways of working to this more standardised
version.
The standardisation of business process does mean that users
find themselves being dictated how to work by the software, which
can lead to limitations, simplification and restrictions on a
business and could mean that the software may restrict a businesses
potential for growth and development.
Another factor that can limit the capabilities of a product is
compatibility with other in house software which could lead to
operational issues. Some older/legacy software may have purchased
without integration and compatibility in mind so enabling the
transfer of data and communication between the new and existing
systems can limit the efficiency gains often expected of new
software. If you are being more ambitious then using a package with
limited integration could restrict the ability to communicate or
share data with other organisations, partners and customers.
However well written packages are not so rigid that they can't
be adapted according to intrinsic business processes and some of
the more expensive solutions do allow you to customise and develop
certain elements to achieve the desired procedures.
Unlike a bespoke system the IPR ownership and copyright are held
by the supplier/manufacturer, which again helps to reduce costs
because they share the development costs amongst all their
customers, and also means that there is little chance of the system
becoming obsolete as they will pool customers' ideas for new
enhancements.
The combination of low price and standardised process does mean
that there is no competitive advantage gained by commissioning a
mass marketed product, so if your business processes are individual
to your company then the bespoke option will give you the best fit
solution.
A Third Way: Componentisation and Reuse
A compromise can be made between off the shelf and bespoke
software due to specialist development firms' abilities to create
business systems using a combination of off the shelf packages or
components which are then modified to fit the needs exactly of the
company. The challenge of matching the exact needs of a business is
overcome through the integration of the various components.
An example of this approach is a good way to illustrate it.
Supplier A might build a component for calculating VAT; Supplier B
might build a component for pricing widgets; Customer X needs a
piece of software which designs and prices widgets so it, or
another supplier, could build a design module, buy the components
from Suppliers A & B, integrate them all using industry
standards without help from A or B and deliver a solution providing
the required functionality at lower cost.
The risks of bespoke development are shifted under
this model to the evaluation of component match to business need,
and to the need for extra integration testing. However the
investment is often lower than pure bespoke development.
This approach will gain popularity because the software industry
is increasingly 'componentising' software and using standards such
as web services which permit easy integration even between systems
written in different technologies or held in different physical
locations.
Summary
Bespoke systems won't be eradicated, as the custom development
approach will always lead the field to build business specific
solutions. There will always be the desire to attempt to automate
and electronically manage new processes that are still currently
done manually or by a number of systems and that have not already
been built. The decision between bespoke and a product often comes
down to the 80/20 rule: if you can get 80% of the requirement met
with a package, why spend extra to build bespoke. However it
is strongly argued that the decision
should be down to your desire for
competitive advantage: if your processes lead your industry and
would be of value to your competitors, build a bespoke solution,
keep the IPR and continue to beat your competition rather than
compromising them down to the lowest common denominator of a
package; on the other hand, if your processes are weak then buy a
package to bring yourselves up to a better standard.
