In today’s world, successful companies constantly monitor business processes and mine them for improvements to maintain (if not increase!) revenue, retain employees and deliver the ultimate customer experience – and here’s where software comes in handy.
Global enterprise software spending will reach $351 billion by the end of this year (up 3.3 percent from 2016). In case you consider investing in enterprise software, too, the only question you have to answer is, “Should I build custom software or choose an off-the-shelf solution instead?”
When does it make sense to go custom?
When Apple trademarked the infamous “There’s an app for that” slogan seven years ago, we weren’t taken in. How could there possibly be an app for monitoring a crowded parking lot or paying for your Starbucks latte before you actually get to the store?
This year, our wildest dreams have finally come true. You can even transform your head into a giant taco – because now there’s a BUNCH OF APPS for that.
It’s the same with business software. Oracle, Salesforce , SAP and Microsoft still dominate the global CRM market, and you can hardly find better apps for customer management. It will cost you an arm and a leg to create a decent SAP ERP clone. Why splurge on a custom productivity app when you can organize your daily goals into achievable bites with Evernote? If you want to start an eCommerce business, you can set up a small Shopify-based online store for only $600 a year – or opt for a hosted Magento website supporting up to 50,000 catalog items for $10,000 (annually).
Why you should invest in custom software development
- Customization. As simple as that. It takes 354 and 421 dev-hours to create a fully-fledged business website with WordPress or Drupal, respectively. The estimate covers website design efforts (including unique themes and mobile optimization), the actual development (landing pages, navigation system, Web forms, content management tools) and SEO optimization. Multiply the efforts by the median Web developer hourly rate (ranging from $160 in the U.S. to $35 in Eastern Europe); that’s the price of a corporate website that is tailored to meet your needs and has YOU written all over it. Sure, there’s the hosted version of the WordPress CMS – and over 40,000 paid and free plugins and design themes to extend its functionality. But what are your customers (especially the tech-savvy Millennials and Centennials who worship speed, usability and authenticity) going to think about the impersonal “face” of your brand?
- Security. Despite SaaS, PaaS and IaaS vendors’ continuous efforts to secure their software, packaged offerings – especially community-driven CMS solutions – do have unpatched vulnerabilities. According to Veracode’s recent State of Security research, 57 percent of third-party apps fail to meet security requirements. It’s no wonder 43 percent of cyber-attacks now target small- and medium-sized companies (the primary adopters of off-the-shelf software solutions);
- Innovation. Apparently, there is an app for everything – but not all apps are created equal. The r-stylelab.com team, for example, has recently built Addzer – a sleek customer referral application targeted at standalone restaurants and small café chains that are new to loyalty marketing or do not want to invest in custom mobile app development. For a small monthly fee, the app enables businesses to set up corporate accounts, add detailed descriptions of their locations, run advertising campaigns and reward loyal customers with bonus points. Why do behemoths like Starbucks and Domino’s create mobile customer loyalty apps from scratch then? Off-the-shelf apps like Addzer, Belly and Perka have their limits. Today you may be entirely satisfied with a third-party mobile app; tomorrow you’ll want to change the direction of your business and engage customers through beacon notifications. Most off-the-shelf software solutions are designed for companies that make use of traditional business models and leave little room for innovation.
Custom software advantages and disadvantages
We’ve already cited several reasons to hire an experienced software developer and build apps from scratch. Other benefits of custom-written software include:
- Scalability and flexibility. With custom software, you can start small and add extra features as your business grows (which is extremely important to trend-sensitive industries like customer services, retail, education, tourism and hospitality);
- Intellectual property. Once you’ve built a custom application, it belongs to your company and might give you a competitive advantage in future. The growing demand for enterprise mobile apps (which is set to exceed the available dev capacity by 500 percent this year) has given rise to low-code mobile app development solutions like Mo-Apps and Appery. What if you take the low-code approach, launch an app and wake up famous? You do not own the intellectual property and will lose a substantial part of the revenue it’s going to generate.
Custom software is not all rainbows and unicorns; it has its advantages (listed above) and disadvantages, which include the relatively high upfront development costs (more than $10,000 for a customized WP business website), maintenance and upgrade expenses, as well as employee training costs.
Off-the-shelf software is probably the right choice for start-ups and small businesses that lack funding, focus on short-term initiatives or are currently making their first steps toward digital transformation. As a company grows, however, the lack of customization options may lead to inefficiencies – and then it’s time to invest in proprietary software. As a business owner, you should be able to identify your pain points and choose a solution that suits your needs best.