Three days ago, I wrote a commentary in which I put forward the thesis that custom software will take market share from SAP and others in many cases, because development is becoming ever more efficient and, at some point, it will be cheaper to build a system that fits your own workflows than to expensively adapt off-the-shelf software to your processes.
A colleague brought up a thought that made me reconsider this: buying off-the-shelf software can ultimately be significantly cheaper if it leads to simplifying your own processes.
Especially in large enterprises, it can sometimes feel like a sport to map the most complex processes across as large a system landscape as possible. The result is often not just technically demanding, but above all expensive. Off-the-shelf software can create a beneficial constraint here: processes have to be reconsidered, simplified, and standardized more thoroughly because the solution does not simply accommodate every special case.
My view: Custom software can still be worthwhile, especially when the alternative is spending a great deal of money on customizations around, for example, an SAP system. At the same time, one thing remains true: complex processes with many special cases make software expensive, regardless of whether it is purchased or built in-house.
If buying an off-the-shelf solution creates real pressure to reduce process complexity, purchased software can ultimately be cheaper, even if you could in principle develop a similar product yourself. However, as soon as you start having the off-the-shelf software heavily customized, the calculation often quickly tips in favor of custom software.
For me, it ultimately comes down to one central question: Can I reduce the complexity of my processes, or do I indulge in the luxury of developing or buying software with a host of special cases?
What is your view? When does off-the-shelf software win, and when is custom software really worthwhile?