Whether you are a small business or large enterprise or a private organization or a government entity, these days software solutions are backbone for day-to-day operations. No business can function without relying on any software application. Even if you are just using emails or WhatsApp, you are still utilizing these software. This blog is not to discuss the emails or WhatsApp, in fact we will briefly discuss about the business solutions, like ERP (enterprise resource planning software), CRM (customer relationship management system), Customer Feedback System, Customer Portals, Intranet Applications, Web-Portals, and core business applications.
Now a day’s a business’s digital eco-system consists of multiple software solutions, some are commercial off-the-shelf solutions (COTS) and some are custom software development solutions. All working in a perfect harmony to drive efficiency, performance, quality and profitability. Businesses operating in Dubai, Sharjah, Abu Dhabi and broader UAE are very eager to optimize their operational efficiency and expenses by leveraging the inherent properties of software applications, such as business process automation, digitalization, analytical data collection and super efficient information flow via advanced communication channels.
The digital technology is evolving at an unprecedented speed, so does the market trends, and customer demands. In order to be more competitive, businesses need to adopt to highly efficient software application. With the growth corporate data and increasing demand for operational excellence also grows, and the decision between commercial off-the-shelf solutions and custom software development has become more critical and difficult. In this blog we will do a comparison between custom software development and off-the-shelf solutions to give you a better perspective of the subject.
See Also: Custom Software for Improved Business Efficiency
What is Custom Software Development?
The custom software development is a process to design software application precisely as per your needs, the customized software are tailor-made for a single business or group of users at an organization. This is what makes them far more superior, efficiency and effective. Unlike commercial off-the-shelf software, which are generic solutions, the custom software applications are design from scratch, which perfectly positioned them as the most effective solution for modern business who strive for efficiency and performance.
The simplest way to understand it is to think of building house, if you commission a professional architect, you can make the house the way you want and need, you can control each and every minor aspect of literally everything. But what if you bought a built house, you don’t have much room to make changes, even if you hire someone, you will still going to have certain limitations. This is how the custom software development is different from the off-the-shelf solutions.
The custom software development process starts with in-depth analysis of your organization’s existing infrastructure, operations, internal processes, workflows and challenges that you are facing. This processes greatly improve the efficacy, efficiency and alignment with your operations. Then all key elements are carefully crafted to minimize the adoption and integration expenses, while ensuring all goals can be achieved seamlessly. With the custom software development you can design the software by keeping your goals, challenges, resources and limitations in mind.
The custom software development also tend to delivery exceptionally higher ROI over a longer period of time. But the thing most organizations doesn’t realize is when do they need a customized software application? The simplest rule to consider is to “don’t reinvent the wheel”. Your email client, such as Outlook or Thunderbolt both are off-the-shelf software, do you need to build one for your organization? Absolutely not!
See Also: Why Off-the-Shelf Solutions Fall Short: Advantages of Custom Software Development
What are Off-the-Shelf Software Solutions?
The off-the-shelf software solutions or COTS, are the pre-built software application, which businesses either purchase or subscribe to. Same like Outlook and Thunderbolt, there are ERPs, CRMs, HRMS, and various other organizational tools which are pre-built, and are designed for a specific industry sector. Moreover what off-the-shelf solution you are using, the chances are very high, your competitors would also be using the same. This undermine your competitive advantage. The biggest advantage of off-the-shelf software solutions is that they are ready-to-use.
The time you purchased them, you will be provided access instantly, and even if the on-premises deployment is required, these solutions can be setup up in a few days. Unlike the customized software application which require a lengthy period of development and testing. For example, Microsoft Office, QuickBooks, Oracle, SAP, Microsoft Teams, Zoom, all are commercial off-the-shelf software solutions. The big-data software market is dominated by off-the-shelf solutions, but businesses are gradually shifting towards customized big-data and AI-powered software applications.
One of the biggest reason businesses opt for commercial off-the-shelf solutions is quick deployment and very low upfront cost. Most of the off-the-shelf software solutions come with a subscription plan, the payments are done on monthly, quarterly or annual bases. The biggest disadvantage in implementing off-the-shelf software solutions is the lack of customization. Most of the off-the-shelf software doesn’t offer any customization, some large-scale application do offer customization but with very limited scope and the customization cost is also very high.
Usually these software solutions are divided into various packages and modules. Sometimes just for a single features, businesses might need to upgrade to a 20%-40% expensive module or version. Which can significantly increase the operational cost in longer run. That is not all, businesses often end-having tons of unwanted features which not only increase cost, but also tend to harm the efficiency of the staff who will be using these solutions.
See Also: Custom Software Development for Enhanced User Experience
Comparison Between Custom Software Development vs. Off-the-shelf Solutions
Now that we clearly understood the major differences between the custom software development and off-the-shelf software solutions, let us compare various aspects which will help you decide which solution could be more effective for which needs and requirements.
Cost Comparison: Custom Software Development vs. Off-the-Shelf Solutions
Cost is one of the most crucial and in most cases the deciding factor when business choose between the custom software development and off-the-shelf solutions. However to understand the costing of both solutions, we have to be very careful. Like I have mentioned earlier, you don’t have to re-invent the wheel. This means, for certain needs, you will surely go for commercial off-the-shelf solutions, such as Microsoft Office, Emails, Teams, Zoom, etc. However, when it comes to accounting, for example, the Quickbooks or Slack might cost you very less, but will never going to align and adopt to your emerging business needs.
There would be costs associated with upgrades, new modules/features, third-party integration and so on. Above all, if you are dealing with sensitive customer data, you will always be at risk, since your data has been stored with the vendor and technically they have full control and to some extent authority over it. The initial cost on the other hand for the custom software development could range somewhere from a few thousand dirham to several hundred thousand. Which might seem staggering comparing to COTS.
However, with the customized software application, you will have full control and authority over your data, you can customize them the way you want, you can add new features down the road, and on top of that these software has capabilities to scale, adopt and evolve along with your business needs. There would be no operational inefficiencies due to mismatching of software structure and your internal processes and workflows.
You will most likely never stuck in vendor-lock situation, and instead of replacing the entire solution, you can simply add new features, upgrade it or customize it as per your new needs. You can also easily integrate customized software with other third-party tools, databases and solutions without bearing large expenses. This makes custom software development superior than the COTS.
See Also: The Cost of Custom Software Development: Factors to Consider
Flexibility and Scalability: Custom Software Development vs. Off-the-Shelf Solutions
I would rather consider flexibility and scalability comparison as direct cost comparison. Because this has huge impact on your long-term cost. Growing businesses often end-up outgrowing their commercial off-the-shelf solutions and end-up paying huge for the replacements. The important and most crucial thing to understand is tha the commercial off-the-shelf solutions are designed for masses, and are designed as per best industry practices and standards. This means a large number of businesses would be using them, hence upgrading an application which has millions of users, and all users can have their own preference, needs, and challenges.
Under such conditions, making huge change in the software could impact millions of users, which will also impact the revenue of the vendor as well. Hence whenever a vendor will decide to upgrade or add more features, or remove some, they will have to be very careful. Therefore the development and growth is extremely slow with commercial off-the-shelf software solutions. The custom software development on the other hand is synonymous to flexibility. The customized software solutions are tailor-made for your business needs, and have potential to keep on evolving with your emerging needs. Adding a new features, removing or customizing an existing features in in your hand.
Moreover, you can do whatever you want to do, there is no restriction or limitation as far as the customization concerns. This level of customization and personalization is invaluable for businesses who want to grow and stand out of the crowd. The customized software keep on evolving with your emerging needs, challenges and growth. Your in-house developers or the outsourcing partner can customize and optimize the features whenever you need them. You can always patch your software or upgrade them to optimize the performance and impact. This way rather ending up replacing your off-the-shelf software solutions, you can keep on using the same application for decades.
See Also: Step-by-Step Guide to Planning Your Custom Software Development Project
Maintenance and Support: Custom Software Development vs. Off-the-Shelf Solutions
Whether you chose commercial off-the-shelf software solution (COTS) or a custom software development, both requires upkeep and maintenance. Businesses often overlooked the maintenance and support while deciding between these two, but it is a very crucial factor to consider. Especially in a fast-paced world, where the time is money, any downtime in a software application or a minor issue could significantly undermine your entire operations. Some issues need to be addressed at immediate bases, as these could have dominoes effect, where one problem or inefficiency lead to another and so on. When it comes to support the commercial off-the-shelf software solutions always lag, no matter how great the application is, the support would usually be limited to general queries and for complex issues, you might have to wait in long queues.
Moreover the support resources for off-the-shelf software are shared and depends on your licensing agreement and in some cases you have to pay extra for premium support. The customized software on contrary comes with dedicated support, the team that built them also offer dedicated support. Another great advantage is quicker problem resolution and timely patches or updates. The software development team that build your application would understand all intricacies of your software hence, they can quickly resolve issues, eliminate bugs, and even made iterations for better user experience and efficiency. You will always prioritized, and in cases of show-stoppers your support team will readily available.
The upgrades, updates, security patches, and iterations can be scheduled aligning with your operating hours, to minimize any impact on your operations. Businesses often do such activities in off-hours or at weekends, to eliminate any downtime. Since you are the sole customer, your requests are always prioritized, moreover you can have direct interaction with the developers which eliminate any communication barrio and ensures quick results.
See Also: Emerging Trends in Custom Software Development
Security and Data Privacy: Custom Software Development vs. Off-the-Shelf Solutions
In this modern day and age the data privacy and cyber security is one of the greatest challenge. We have witnessed many multinational businesses get completely destroyed after data breaches, most of them still haven’t recovered to their formal glory. Now a days customers are very savvy and aware of the cyber threats, on top of that the media, news and social media also played their role in spreading the awareness. Businesses too are way more conscious about the cyber security. One of the biggest drawback of off-the-shelf software solutions is that your valuable data is stored on vendor’s servers, and even if it is stored locally (which is very rate), the vendor still have full access to it.
Moreover, the vendor is almost fully responsible for the security, but you might also have to take certain measures to ensure maximum data privacy and protection. The off-the-shelf solution are more likely to get targeted due to known vulnerabilities due to the fact that millions of people all around the world have access to these solutions. However, the custom software development enable businesses to adopt to advanced security practices. In fact the security can be prioritized throughout the development lifecycle. A secure development lifecycle help adding multiple layers of security and protection.
Unlike commercial off-the-shelf software solutions, businesses have full control and ownership of their data. They can choose where and how to store their data and no one can be given access to it, outside of the organization. Since the applications are built from scratch in custom software development, your software structure and design is fully confidential and no one knows it. Moreover businesses can have frequent and regular security and vulnerability testing which help them instantly apply security patches, keep the source code up-to-date and keep on adding new security features down the road. These are the reasons the customized applications are considered to be more protective and superior than off-the-shelf solutions.
See Also: Security Best Practices in Custom Software Development
Conclusion
Choosing between off-the-shelf solutions and custom software development is always difficult. Businesses have to consider multiple factors, and majorly it depends on your needs, budget, and long-term strategy. Both off-the-shelf solutions and customized software applications have their unique advantages and disadvantages, but in most cases the custom software development tend to offer extremely higher ROI. Even on technical grounds, the customized applications are technically more superior, advanced and future-ready. For example, if you need an email client, what would be more beneficial? Developing a new email client or opting for Outlook or Thunderbolt? Obviously your needs are the major driver here, but if you need a complex application or tool, then the custom software development is much better choice. The off-the-shelf software solutions have many limitations, the application lack in offering any competitive advantage, and tend to grow at a very slow pace.
Businesses who consider the upfront cost and deployment time only, often end up replacing their off-the-shelf software solution with a more expensive and complex software application after some time. Because the commercial off-the-shelf software solutions tend to grow and evolve very slowly. The custom software development is a comprehensive process, which let businesses build their software from scratch, hence the software fully aligns with your unique and exclusive requirements. Moreover the customized software have potential to evolve along with your business needs. You have full control and authority over the source code, data and security aspects, which is a great advantage. There are no hidden fees or hefty charges for very limited customization. The custom software development is far more superior in every aspect and could be a game changer for businesses.
In this blog we have briefly discussed a few crucial aspects of software development to compare both off-the-shelf and customized software. If you want to learn more or if you want our help to design a bespoke software application for your organization, please feel free to contact us through our Contact Us page or leave a comment in the comment box below and we will get in touch with you soon.
See Also: Benefits of Investing in Custom Software Development for Your Business in Dubai