Build vs. Buy: A Comprehensive Guide to Software System Decisions

The classic decision every tech leader will face

Introduction

Software is your company. Software is integral to the modern business landscape. The software you build or buy defines your business, and therefor its success. Build vs buy is the most important decision you can make at the high level. Speed to market, support, cost, integration effort, switching costs, these are all aspects of this decision we will cover in this mega-post for premium subscribers. As someone who recently got approval to build an in-house solution, I will share insights from evaluations, TCO (Total Cost of Ownership) tables, and stakeholder meetings to provide an insider's perspective on the engineering process.

As a people manager or an individual contributor (IC), you will have important input on buying or building to satisfy a tech capability. Both perspectives provide valuable lenses used to make the decision. In this post, we will focus on the tradeoffs involved in the build vs. buy decision. Let's dive in.

Turbo Note: IC means individual contributor, which the track for engineers. In many companies this means you are a software engineer and do not manage people. Varies by company, search engine it if you’re still curious.

Table of Contents:

1. Introduction

2. Understanding the Build vs. Buy Decision

3. Advantages of Building a Custom Software Solution

4. Disadvantages of Building a Custom Software Solution

5. Advantages of Buying an Off-the-Shelf Software Solution

6. Disadvantages of Buying an Off-the-Shelf Software Solution

7. Organizational Factors

8. Conclusion

Build vs. Buy: A Comprehensive Guide to Software System Decisions

Understanding the Build vs. Buy Decision