Off the Shelf or Custom Enterprise Software?
Finding the sweet spot for your business
When a business evaluates its software needs, a common question is always whether to select a Commercial Off the Shelf (COTS) solution or to choose something that’s more customized. This question comes up all the time in conversations I have with customers (and potential customers) and I wanted to share a few good questions you can ask yourself as you evaluate what I call “the sweet spot” for enterprise software success. Finding that sweet spot is different for every business but the considerations are largely the same.
1) Are there COTS solutions that will meet your needs?
When people think about off the shelf solutions, they often have pre-conceived ideas about what those solutions can and cannot do. It’s important to carefully evaluate all the options with a critical eye because each one carries nuances that could have an important impact on your business. For instance, some COTS solutions do offer small elements of customization. Some solutions may include lots of features you don’t need—so why pay more? Some solutions are cloud-based while others are hosted in-house.
If you’re leaning toward a custom solution, that brings a whole other set of considerations—most importantly, if you’re paying for custom software, you better make sure the vendor you choose is the most qualified choice for meeting your requirements now and in the future.
2) What will your software choice cost you—today and over time?
Sometimes businesses are in such a rush to implement a software solution now that they don’t think far enough down the road to future requirements. It’s not a question that can be answered off the cuff, but think about:
- How will your business grow in the next 3, 5 or 10 years?
- Is the software solution flexible enough to grow with you?
- How important is time to market as your needs change?
- What’s your current or projected budget for software upgrades?
- Will your software choice eat away at other resources in your organization over time?
- Do you have a solid disaster recovery plan?
3) What human resources do you plan to contribute to the solution?
This is a big question, particularly for smaller businesses without many (or any) software development or even IT resources on staff. If you go with an in-house solution, it’s important to think about any support that may be required to keep the software up and running, resolve issues or manage special situations. Software providers typically offer some level of support but it’s important to be 100% clear what those support resources will be and how the structure will work with your workflow needs.
Selecting a completely custom software solution will require resources as well. With a custom package; however, businesses typically expect a deeper level of support from the software vendor. For your organization, that may mean having dedicated consulting staff members available at all times—or it could mean having a software partner that works together with your own development team. It’s important to think about your own situation both now and in the future as you choose the right solution for your business.
4) If you’re thinking custom, what flavor of “custom” do you need?
The way I like to explain the software landscape to our potential customers is in four different “flavors”:
- COTS in-house
- COTS in the cloud
- Custom in-house
- Custom in the cloud
I’ll talk more about these “four flavors” in future posts but regarding the last two options as you think about a custom solution, the decision factors that go along with that are most often cost, ability to customize, flexibility and required resources. It’s a lot of what I’ve already touched on but we’ve found that the cloud offers some of the best options for creating a fully customized implementation with the greatest value proposition.
Bottom line: It’s important to think carefully about the pros and cons of each solution before making the best choice for your business.
