Buy vs. Build in the Age of Disruption

I have spent most of my career working with large enterprises, but over the past 30 months, I have had the opportunity to work with many B2B SaaS start-ups. This experience has given me a look-in into the dynamic landscape of technology solutions and the evolving needs of modern businesses.

The digital age has ushered in an unprecedented wave of technological advancements, especially in AI and machine learning. Enterprises now face the perennial question: should they buy ready-made SaaS solutions or build their own in-house?

The Temptation to Build

1.      Innovation and Image: Enterprises often believe that building their own solutions will enhance their reputation as innovative and cutting-edge leaders in their industry.

2.      Tech Enthusiasm: The desire within tech teams to experiment with the latest technologies and tools is strong, driven by a natural curiosity and the allure of new advancements.

3.      Perceived Uniqueness: There is a common misconception that no external solution can meet their unique requirements, leading enterprises to overlook existing solutions.

The Reality Check

1.      Startup Expertise: Start-up teams often have a deep understanding of specific business needs, which is sometimes lacking in enterprise tech teams that may be disconnected from the day-to-day business challenges.

2.      Focused Development: SaaS platforms tend to focus on a narrow functional area, putting a lot of time, thought and resources into it. In contrast, enterprises have wide-ranging needs and must spread their attention. This focused approach leads to deeper and faster innovation in those specific areas.

3.      Innovation Through Diversity: SaaS providers serve a wide range of customers, fostering a diverse pool of ideas and innovations that can enhance their offerings beyond what a single enterprise could achieve alone.

Why Buy Over Build

1.      Rapid Deployment: SaaS solutions can be deployed quickly, allowing businesses to benefit from advanced features without the lengthy development times. Additionally, the value of the solution can be evaluated quickly ahead of the purchasing decision, whereas in-house development requires significant work upfront.

2.      Cost Efficiency: Building in-house solutions can be significantly more expensive due to development and maintenance costs that SaaS providers can spread across multiple customers.

3.      Continuous Improvement: A SaaS solution continues to improve and evolve without further engineering investment from the enterprise. This ensures that the business benefits from ongoing enhancements and new features over time.

4.      Expertise and Support: SaaS providers offer specialized expertise and ongoing support, ensuring that the solution remains cutting-edge and reliable and reducing the burden on in-house teams on internal support and user training.

5.      Focus on Core Business: By opting for SaaS solutions, enterprises can focus on their core competencies, rather than getting bogged down in software development.

Conclusion

While the temptation to build in-house is strong, especially with the allure of new AI technologies, the smarter choice in today's fast-moving world is often to buy ready-made SaaS solutions. These solutions not only provide immediate benefits but also leverage the expertise and innovation of dedicated teams, allowing enterprises to stay ahead of the curve without losing focus on their primary business objectives.