In the digital age, organisations face a crucial decision when enhancing their lean production systems with digital applications: to build their own solutions or to buy off-the-shelf software. This choice is not to be taken lightly, as it can significantly impact implementation timescales, ease of use, operational efficiency, budget allocation, and competitive positioning. Let’s delve into the advantages and challenges of each approach.

Building Your Own Applications: A Tailored Approach

Pros:

• Total Control: Crafting your own software from the ground up offers unparalleled control over every aspect, from features and functionality to the user interface.
• Customisation: Tailoring the software to meet the exact requirements of your organisation ensures a perfect fit for your specific needs.
• Ownership: Retaining full ownership of the software’s code secures your independence and flexibility for future modifications.
• Potential Cost Savings: Utilising internal resources for development may initially obscure direct costs, offering financial benefit until you get found out!
• Competitive Advantage: A bespoke application, not available to competitors, can provide a unique edge in the marketplace.

Cons:

• The Pareto Principle: Achieving the final 20% of your requirements can be disproportionately challenging and costly, yet it can deliver significant value.
• Shift in Focus: The drive to build and enhance the software itself can divert attention from delivering core operational improvements.
• Resource Dependence: Reliance on a small team for development and maintenance poses risks, especially if key members leave.
• Missed External Expertise: Building in-house means foregoing the insights and innovations developed through the broader industry experience.
• Inflexibility: A significant investment in a bespoke tool can make it difficult to pivot if the application fails to meet evolving needs.

“This choice is not to be taken lightly, as it can significantly impact ease of use, operational efficiency, budget allocation, and competitive positioning.”

Buying Existing Software: The Off-the-Shelf Solution

Pros:

• Lower Initial Costs: Off-the-shelf software often presents lower upfront investment compared to bespoke development.
• Speed to Implementation: Purchased solutions can be deployed more rapidly, accelerating the realisation of benefits.
• Proven Solutions: Market-available products have been tested and refined, potentially meeting all your needs without the need for development.
• Predictable Maintenance: Understanding the long-term costs of software maintenance can be more straightforward with purchased solutions.

Cons:

• Less Financial Flexibility: The costs associated with purchasing and maintaining software are more transparent but harder to mitigate.
• Lack of Ownership: Not owning the source code may limit your control over future modifications and dependencies.
• Ongoing Costs: Subscription or licensing fees, along with maintenance charges, can accumulate, impacting long-term budgets.

“The choice between building bespoke digital lean applications or purchasing existing software is pivotal. It necessitates a careful evaluation of your organisation’s specific needs, budgetary constraints, and strategic objectives.”

Making the Decision

The choice between building bespoke digital lean applications or purchasing existing software is pivotal. It necessitates a careful evaluation of your organisation’s specific needs, budgetary constraints, and strategic objectives. Consider the balance between control and customisation versus speed and cost-effectiveness. Assessing both the immediate and long-term implications of this decision will guide your organisation toward the optimal digital enhancement of your lean production systems.

This decision is not merely operational; it’s strategic, shaping the future trajectory of your organisation’s digital and operational capabilities.

As a software vendor, at Iter Digital we favour the “buy” option as having invested thousands of hours of development in our applications we know just how much effort is required, however, we are happy to engage and share our knowledge and expertise with organisations making the build or buy decision. To discuss your specific requirements please contact colin.prout@iterdigital.co.uk