Opinion: When do you need to develop software in-house?

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It’s very clear that consumers expect even small businesses to be online, accessible, and easy to use. New research shows that the cloud and consumer demand are driving businesses to revamp and improve their applications. In fact, business spending on application software is expected to rise fast, hitting the $200 billion mark by the year 2020.

And even though B2B software hasn’t always been known for being user-friendly and elegant—in fact, it’s often confusing or just bad — users are starting to demand so much more. So how can you be sure that the user experience you’re offering is on point? Is in-house software development the only way to get the best possible user experience from your software?

Many businesses believe that the lower cost of a development platform that is already available means it’s not as good as one they’ve developed internally. Companies also worry about using a software that isn’t original because someone else owns the app from an intellectual property standpoint. The conclusion many businesses come to is that they need an in-house team to create their app from the ground up.

The good news is: most companies really don’t need to create, develop, and own their own development software. Here’s why.

There are really only a few cases when developing your software and app is important to your business. The first is the most obvious: if you have genuinely unique needs for the software, you may in fact need it to be customized to the extent that only unique in-house development will handle. However, this means that anyone selling goods or services or showcasing their work is covered; there are great apps and software options out there that make sense for these uses, and you can easily outsource your needs in this case and still come away with a user experience that is unique enough while giving an optimized experience.

It also makes sense to build your software and app yourself from scratch if your business creates apps and software or games—but then, this should be obvious. But most businesses need software and apps that are content-driven. What you’re connecting your customers with matters, it’s your product after all, and how the connection itself works isn’t so crucial.

Also, don’t forget: your customers know now that there’s no reason to reinvent the wheel—they use Dropbox and WordPress; they don’t expect you to reinvent the wheel either. Moreover, by outsourcing you lower your overall costs. That’s something just about every customer cares about.

Save your IT department for the work that’s central to your business, and for maintaining your security. And if technology isn’t your business, your IT department is simply facilitating the smooth running of your company, not creating original value. Holding the team to that mission saves your company money without hurting the business. Don’t get bogged down in the details when software and apps that can give your users a great experience are easy to come by.

Can you think of other situations when it's better to develop software in-house? Let us know in the comments.

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10 Sep 2015, 12:45 p.m.

I worked at an ISV that sold software to sell new houses and maintain warranties on the houses. We had a whole department that wrote custom bolt ons for the products. I would write a piece of custom software for a customer. Then I would have another customer with what sounded like similar needs to me. Sometime the 2d customer would scoff at the solution for the first customer, saying no one would run their business like that. Sometimes these customers were divisions of the same homebuilder.

This is one reason why there will always be companies willing to write software inhouse. Some organizations believe HOW they run their work is one of their advantages against their competitors.

'Moreover, by outsourcing you lower your overall costs. ' - wow! That's quite an assertion. I don't think it is always true.