We have already seen what a CRM is, what it is for, and why it is necessary to adopt it (if you missed the articles, read: “CRM: what it is and what it is for” and “Why use CRM”), but how to choose whether to produce it internally or whether to buy it externally? Being aware of the importance of this choice, we have provided you with some good food for thought in this article to make this decision.
CRM: Buy It Or Develop It Internally? The Choice Is Yours
Below are 9 elements on which to base good reasoning to decide whether to develop a CRM internally or whether to purchase a market solution (such as SugarCRM, Microsoft Dynamics 365, or Salesforce ):
Times
- Make: Home-developed solutions give the perception of freedom and flexibility, but you need to hire staff and form a dedicated team to develop your system.
- Delays, unforeseen events due to developer turnover, or a trivial change in priorities can significantly postpone the expected realization times.
- Buy: Apart from cost, which, as we will see below, is an important consideration, opting for an out-of-the-box solution means having a CRM tool in place much sooner (typically months or weeks vs. months or even years).
Costs
- Make: Internal development is a “cost center.” It reduces IT and financial resources. In any case, offshore resources require huge funds in terms of coordination and communication.
- Assuming that the technical expertise is there, what do we know about the strategy to adopt?
- What about business analysis and best practices to adopt?
- How to ensure adoption?
- Have ongoing governance costs been accounted for?
- The list of questions to ask yourself is endless. Therefore, the total business impact costs
- should be foreseen, not those limited to IT resources alone.
- Buy: IT vendors invest large amounts of money and resources to provide modern and secure solutions such as CRM systems. This is only possible because the investments are shared among thousands of businesses and companies that cannot afford to face such an effort individually. Furthermore, the cost, in this case, is easily predictable.
Risks
Risks are the probabilities and potential impacts of something not working. Both choices come with different dangers, and it’s up to you to know which are the most impactful.
- Make: The main risk in creating software is related to delivery. We’ve all been part of software projects that needed to be completed (despite large sums of money invested). This risk can be higher or lower depending on the type of project; creating software that you need to become more familiar with can lead to big problems and high expenses.
- Buy: The risk is reduced a little when you choose the buy option. The main risk is that you are equipping yourself with software that you need to control fully. You also need access to the source code. Why is this a risk?
- One word: bugs. When you find a bug in a piece of software you’ve built, you can create a ticket for the development team and fix it. When you find one in a purchased product, you will likely need to submit a ticket to the vendor’s support. They try to recreate the bug in their environment and then respond to you. If they agree it’s a bug, they plan it for their next release. You will see the solution within a few months.
Also Read: Companies That Integrate CRM And E-Commerce Are Increasing
Features
Make: What problems are you trying to solve with developing or adopting new software? It is crucial first to understand if it is related to your core value proposition. If the answer is not certain, evaluating the purchase is the best choice. Therefore, creating something highly specialized from scratch or that does not affect your business is not recommended. For example, how many companies do you know that have developed their email clients in-house? That is very unlikely…unless your business does email services.
Email is a specialized service, but it has nothing to do with your company’s bottom line, so it simply pays to adopt out-of-the-box software. If, instead, we take a financial company, no one would adopt software that holds funds and customer transactions. Certainly, it is better to keep everything internally. Build what differentiates you.
Having made these considerations, analyzing all the necessary functions is necessary. The ideal is to involve every department to obtain a complete list that will translate into the definitive solution, ready to satisfy the collective requirements.
Buy: Standard software is feature-rich and allows you to benefit from the specific options required and many other features that have proven useful and sometimes indispensable for so many companies like yours. Among these is the ability to customize the software through workflows and development tools.
Evolutions
- Make: It is necessary to remember how much technical support is used internally.
- Do you have enough staff and time for ongoing platform development and maintenance, such as software updates and bug fixes?
- Buy: A standard CRM solution is constantly developing for a simple reason: if it doesn’t evolve, it goes out of business. So expect frequent updates that will allow your company to benefit from what other companies like yours have already tested.
Stability, Safety, And Maintenance
- Make: Keeping custom software up-to-date is much more difficult than we usually think. Regulators periodically issue new compliance rules; hackers are constantly looking for vulnerabilities. Also, since the system is only used by a small number of users (regardless of the size of the company, there can be no comparison with the entire user community of an average vendor), it is much more difficult to spot bugs in a developed solution in the house which is therefore probably unstable and sometimes unsafe.
- Buy: As off-the-shelf solutions are tested, high levels of support are offered per the maintenance contract, simply because any existing problem in established software is well known and much easier to fix. Updates are released as included in the subscription, offering the functionality you need without going to a team of developers.
Resources
- Make: Development resources are often limited and necessarily directed towards projects directly related to your business. Building on-premises applications without specific roadmaps can be expensive to maintain and is sometimes flexible enough to meet your needs. Think about your current resources before embarking on such a project because the truth is: “Just because you can, doesn’t mean you should.”
- Buy: You don’t need to think about it. Pay for what you use and enjoy the service.
Integrations
- Make: Unfortunately, many companies are tied to long contracts and messy and outdated integration infrastructures. The cost of making a change can be prohibitive and risky for these companies. This is all the more reason not to build on what is already unstable and outdated. This will drastically increase your TCO over time as it becomes increasingly costly regarding support and process.
- Buy: If you have chosen a CRM system that integrates easily with other tools in the company, you can create a powerful “back office machine” that simplifies and improves your business processes. For example, SugarCRM allows you to integrate with many popular business apps, such as Outlook®, Gmail, and Exchange.
Extensions
- Make: You have to build what you need.
- Buy: You can rely on what your vendor offers and what is on the market. You can build what you need using the solution’s tools if necessary.
Also Read: How Can CRM Improve Customer Service Experience?