Buy vs Build – SaaS Software or Custom Development?
Custom software and software as a service (SaaS) has changed the way that many companies meet their goals. If you need software that performs specific tasks, you should consider the following five factors to decide whether custom software or SaaS solutions suit your business’s needs better.
1. Degree of Customisation
The good thing about custom software is that you can include any features that you want. Adding more features will increase the software’s overall price to develop, of course, but some companies are willing to pay for those features.
Unfortunately for those companies, many of the custom software’s features will go unused. Some research shows that 64 percent of features included in internal-use applications never get used. An additional 19 percent are used rarely. In other words, customizing software doesn’t necessarily mean that you will spend money on features that your business needs to succeed. To make the situation even worse, those extra features can make it harder to train employees.
SaaS solutions can help you avoid these problems because they usually include factors that other users find helpful. SaaS software developers know that they must include the most important features to attract clients. Over time, the developers can add and remove features to meet the needs of customers.
A SaaS solution may not have all of the custom features that you want, but it should include the most important ones. Once your business outgrows the software’s usefulness, you may want to consider investing in custom solutions. Until then, it makes more sense to choose a SaaS solution.
2. Product Improvements
Theoretically, you can improve custom software as often as you like. Making changes to the enterprise software, however, can cost a lot of money. Software developers may charge $400 to $800 per hour while updating custom applications. It doesn’t take long before you face thousands in extra costs.
The high costs force most companies to make punctuated software improvements once a year or every few years, depending on the organisation’s size.
Popular SaaS software receives frequent updates to stay current with the needs of its users. For instance, Microsoft updates Office 365 ProPlus every month. Salesforce receives scheduled maintenance twice per month.
When you want software that updates continually, you should choose SaaS with a reliable improvement schedule. It will keep you at the forefront of technology without forcing you to spend extra money on upgrades.
3. Integration With Third-Party Software
When it comes to integrating with third-party software, custom software has a slight advantage over SaaS solutions. You can have custom software built to integrate with any third-party software that your company uses.
Realistically, though, few companies will find that custom software integrates better than SaaS options. Today’s SaaS software comes with application programming interfaces (API) that let them work in coordination with other products. (You can think of APIs as connections that let programs exchange information.) As long as two pieces of software have compatible APIs, you can use them together.
Luckily, SaaS developers can give you all of the information you need to decide whether their programs can integrate with your existing software. If a SaaS solution isn’t compatible, then you shouldn’t buy it. If the developer says that its software’s API can work with your other software’s API, then integration should occur easily.
4. Speed of Implementation
Building custom software for a business can take months or years of work. The precise amount of time that it takes varies depending on the size of your company and tasks you need the software to perform. Typically, though, you can expect to wait several months before you can even test a beta version of the software.
After finalizing the software, you still need to install it in devices and train your staff to use it correctly. You could easily wait a year or longer before you implement the custom software.
SaaS software offers a much faster option. In many cases, you can implement SaaS software on the day you purchase it. Since the software already exists, you don’t have to wait for a team to build it. Even if the software needs a few tweaks to fit your business’s needs, you can expect to start using it within a month.
Even if custom software sounds like the best option for your company, the high price of hiring a software engineer could make you change your mind. Assuming that you hire a software developer, you can expect to pay that person at least $100,000. The most experienced developers can earn more than $160,000 per year. You can choose to hire a software development company to do the work, but you shouldn’t expect the price to fall by a considerable amount.
SaaS developers can charge less for their services because they distribute costs across their customers. Instead of spending hundreds of thousands of dollars, you may only spend a few hundred each month.
Since you pay for SaaS access through a monthly subscription, you can choose to stop using the software at any time without losing money. If you decide that custom software doesn’t fit your business’s needs, then you either have to continue using it or spend thousands more on updates.
Most businesses will benefit from choosing SaaS solutions with the features they need. In some cases, customized software works better but it requires a hefty investment and long implementation time.