Should You Build Your Own Membership Management Software?
As a business owner, balancing your business immediate needs with its long-term growth is both vital and challenging, especially if your business is a startup. Challenging questions shall appear, such as whether you should invest aggressively in the long-term or take the less expensive route and more conservative approach. The build versus buy decision, for instance, is a significant one that plenty of companies deal with when addressing their software needs.
You’ve got two choices to make: either build your solution in-house, with all the management and upkeep that it entails or your purchase a solution from a vendor. It can be quite a difficult decision to make, with several benefits and drawbacks to either approach.
So should your company build a membership management solution? Or buy one instead?
While building one does make some sense for certain businesses, buying one can be the better choice for others. To better clarify, when we say to build or buy, this is what we mean:
Build: Use internal resources to develop your membership management software or hire a developer or vendor to develop one for you.
Buy: Pay for an existing membership management software.
Building your custom software can unlock a variety of benefits, but companies should only choose this strategy if better software can provide a competitive advantage relative to your competitors and you are developing a large business that can spread the cost of a proprietary system over a large number of clients. Take the time to consider what’s written below before coming to a final decision.
While developing custom software is quite expensive, the return on investment can be well worth the weight. Although, keep in mind that a significant amount of attention, resources, and time needs to be dedicated to its development. These tasks associated with custom software may initially make a canned solution seem like a better idea, but there are several reasons to reconsider.
Ready-made software cannot meet every need
Brought software generally addresses many of the needs of most companies. If your business requires a more specialized touch, custom software is much better qualified to meet them.
Ready-made software is fixed
The vast majority of off-the-rack software is fixed and doesn’t allow you to modify any of its functionality in a meaningful manner. It can be quite troublesome to add or subtract built-in features, leading either too many or too little functions for your business.
You are aware of what your business requires better than anyone else. Maybe it’s an established multinational corporation relying heavily on monetizing trade secrets and intellectual property, making operations security vital. Maybe it’s a decade-old company working with a variety of data-driven systems. The needs of your business may also change over time, as your business scales. Including new product lines or expanding towards new locations can cause new marketing challenges to occur.
Most of the time, what you manage to get from ready-made software won’t be capable of helping you with those needs. You may get something close to what you’re looking for, but there will be something missing. Rolling your solution could give you an answer to your current problems, with customizability to adapt to new situations as your business continues to expand.
Ready-made software may not be compatible with other systems or programs
Your business may be running on a lot of different systems, especially if your company has a bring-your-own-device policy set in place. There’s Windows 7,8, and 10 on the desktops, macOS on the laptops, Linux on your services, Android and iOS phones all being used. Some companies still have older legacy systems in place, for example, a couple of years back, MS-DOS was still being used for critical operations in the United States Navy.
Even if you manage to locate a vendor with a solution that’s platform compatible, capable of working on every single operating system running at the office, it may not be compatible with other software programs. Maybe the databases you’re utilizing to gather marketing analytics information aren’t compatible with that pre-made product, requiring your team to manually feed the data into the vendor’s experimental software system.
As stated before your company may rely on a Software X to complete a single task and Software Y to finish a second related task. If these two programs are unable to communicate effectively, this may lead to some efficiency problems. If you manage to develop your software, you can integrate with a wider set of APIs from different software and data partners.
All of these problems could eat up time, meaning the loss of revenue.
In the case of your company manage to reach corporate maturity, it’s no longer worried about survival, as it’s managed to grow so much in scale and geographical extension that it’s a force to be reckoned with in its respective industry. If you’re the CEO of a corporation with tons of staff members all over the globe, you may have the economy of scale to set your IT team to build software for it. With the capability to deploy it all over the world, as just one of many assets to a massive company, the time and capital cost to the business may not see that ideal.
Under certain circumstances, choosing ready-made software may be the more sensible option. Smaller businesses, in particular, may benefit greatly by going this route after taking the following factors into account:
Limited budget
The costs that can be associated with developing custom software may be one of the first and most important reasons for a business to avoid even selecting this option. Purchasing software can be much cheaper and therefore can make much more financial sense for a business that has a smaller budget.
Lack of technical proficiency
If you don’t have a capable software team at your helm with the proper skills to build that important custom software, it would be a smart choice to pass on the opportunity until you manage to hire such a team in place. If you cannot hold your software developers accountable for such a vital project, it will be much harder to create a quality product.
Not enough time
Developing proprietary software can take a great amount of time to complete successfully. Businesses that don’t have any time to dedicate towards development for this custom software should not immediately pursue this route and instead, consider purchasing one.
Well developed management software is already available
If you are running a common business, such as a restaurant, there are generally ready-made membership management software available that are already proven to be effective for your business purposes.
Not a competitive advantage
Perhaps the business you are running is a retail store for clothes. In this case, building fantastic technology would unlikely be a factor that sets you apart from the competition, nor would it likely be something that would help you provide a higher quality service or product at a lower cost and make potential customers want to select your brand over any others.
Your business is an expanding and ever-growing organization, so it is understandable for your software to adapt and grow alongside your business as well and not remain static. If you do anticipate your company growing at a rapid pace, here are some ways custom software can help make your business more scalable.
Increased productivity
Programs that are specifically designed with the needs of your company in mind enable your team to work faster and smarter. You can develop one comprehensive technology platform as opposed to utilizing multiple different programs. An integrated platform can yield considerable efficiency gains since all the information is located in one place and users do not have to keep switching between different programs as part of their workflow.
Competitive advantage
If you continue to rely on the very same ready-made software as your competitor does, it’s that much more difficult to outperform them. By coming up with your technology that is ideally suited for your specific business operations, you’ll garner a competitive advantage relative to your competitors. That advantage expands as you invest more heavily in your proprietary systems.
Higher reaction time
To build solid custom software, you must first hire a skilled software development team. Once that team has been gathered, they can build a variety of products, tools, and systems. As your company’s needs shift and as your industry evolves, being able to quickly change technology strategies can mean the difference between remaining dominant or becoming obsolete.
There are many reasons why you should buy from an experienced vendor, such as ease of setting it up, cheaper costs, and updates.
Ease of setting it up
Instead of having to spend tons of time designing, building, debugging, and deploying an inhouse experimental management platform, purchasing the software from a vendor can get a system up and running within a few weeks. Why wait for months or even a year to solve a problem that you have right now?
Cheaper costs
A custom-built management program has to be developed from scratch and then maintained. That’s going to be a significant upfront and ongoing cost. Purchasing a ready-made software cost generally less than a built one. Since vendors have multiple clients, they can spread out their need for revenue across them, reducing the cost for each customer.
Updates
You won’t have to spend time organizing team meetings with your software development team to brainstorm new features for your management software. Usually, the ready-made software business already has a dedicated team enhancing their offerings with new features and functionality on a rolling basis, with potentially no additional cost to you.
After considering the information above, most organizations have decided that the cost of developing is too high and the flexibility too low for them. Instead, they decide to buy. As you can imagine, there are only rare cases where it makes some sense to build. Even so, despite the initial costs, custom software can be worth the resource it requires if you are hoping to grow a business of a meaningful scale. Developing your software that is specifically tailored for your company’s needs, as well as focused on scalability and efficiency, can help mean the difference when offering a service and offering a highly differentiated one at a better price.
Originally published at https://www.joinit.org.
