Standard software vs. individual software

Develop software yourself or buy it off the shelf– is this question still justified?

Regardless of how unusual customer requests and visions are: Software can be developed and used today in such a way that it suits everywhere. There are many solutions. But the question remains: “Should software be developed individually or does a standard solution suit the company’s business processes?” This question is derived from the strategy, says bbv expert Michael Maurer as he explains the advantages and disadvantages of both options.

02.09.2022Text: bbv0 Comments

There is no one-size-fits-all answer to whether a company should use individual or standard software. The decision is essentially a trade-off depending on the situation, says Michael Maurer, Senior IT Consultant & Solution Architect at bbv. Regardless of whether a company opts for standard or individual software or even combines the two: “Both individual solutions and standard software have a raison d’être.”

The business- and industry-specific evaluation is a decisive factor in this respect. The particular solution strategy a company chooses should therefore be decided collectively by the IT managers and business managers. bbv advises companies and helps them to find the right strategy by taking an holistic view of the requirements in order to achieve the best possible result. This support extends across all phases: from generating ideas to developing prototypes, performing a proof of concept through to implementation.

The differentiation strategy paves the way

It is important to be clear on what the requirements are with respect to the final solution, says Maurer: “First of all, the following questions should be answered: Where does the company want to stand out on the market? In which areas is it worth investing in an individual solution in order to develop a USP for your company? In which areas do you want to become more efficient?” As a general rule, investment in an individual solution makes sense where it is important to stand out on the market. “A company might only achieve the desired efficiency or the user experience that it wants to offer its customers with an individual solution. Perhaps a product can only be produced using custom software. On the other hand, a software solution may already exist for a company’s production requirement, which is tailored optimally to the existing business processes”, says Michael Maurer. And sometimes it is sufficient to use software that is not fully adapted to the business processes.

Both standard solutions and self-developed solutions have advantages and disadvantages. Michael Maurer explains some rules of thumb that might help with the evaluation:

Standard software:

+ can often be used quickly. Time-to-market can often be shortened.

+ Standard software is mostly based on best-practice scenarios. Successful models or proven scenarios and methods can therefore be adopted directly.

+ Ideal for areas of the company that are not core business and are not important in terms of differentiation on the market (e.g. HR, Logistics, Archiving, etc.).

+ Standard software can be adapted to your own needs through customising.

– Possibly high follow-on costs (e.g. for adapting to the ecosystem, mandatory upgrades, licences, support, etc.).

– Risk of long-term commitment to the manufacturer (vendor lock-in).

– Conform to general market demands. Individuality may fall by the wayside, companies are restricted in terms of use.

– Integration or interaction with surrounding systems is not always assured.

Individual software:

+ Can be adapted optimally to the desired functionality/needs.

+ USP and important business processes can be replicated optimally in the software.

+ Can be adapted more flexibly and faster to changing market demands.

+ You do not pay for software parts that you do not actually need.

– Higher initial costs in some cases.

– Different development times.

– Sometimes you reinvent the wheel by having to develop things that already exist in standard software.

– Users have to get used to “new” software.

There is no either/or, combinations are also possible.

Whether you have opted for an individual solution or standard solution, many doors remain open. “Once you have made the choice, combinations are possible. An individual solution can be extended by standard components or standard interfaces and, vice versa, many standard solutions can be adapted relatively closely to your own needs.” The range therefore stretches from a complete in-house development to use of a standard solution with no adaptation. In between, according to Michael Maurer, practically anything is possible.

A combination can involve extending individual software with ready-to-use tools, add-ons or open source components. In addition, ready-made components, such as libraries or frameworks, can also be referred to as standards in some ways. Combining proves to be a good strategy in many cases, says Michael Maurer: “Using standardised interfaces such as APIs, individual solutions can be easily incorporated into an existing system landscape; at the same time, many standard solutions can be customised such that they are well adapted to your own business processes.”

The expert

Michael Maurer

Michael Maurer is a (Senior) Consultant and Solution Architect at bbv in the financial service provider & transport fields. He focuses on digital transformation, innovation management and the design of (cloud) software solutions. Thanks to his many years of experience in the SME area, he understands their challenges and can highlight targeted solutions and implementation options. He is convinced that digitalisation offers a major opportunity for all companies.

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