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To Build or To Buy

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When presented with the choice of building your own ideation software or purchasing a solution to collect feedback and ideas, it is important to consider a number of different business impacts, …

When presented with the choice of building your own ideation software or purchasing a solution to collect feedback and ideas, it is important to consider a number of different business impacts, including:

Cost
Resource Investment
Agility
Ability to Scale
And More

Published in Technology , Business
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  • 1. Innovation Software: To Build or To Buy? That is the Question The Must Have There are very few businesses that can claim digital independence these days. Most organizations (from nonprofits to multinational corporations) conduct a large percentage of their business using specific software programs for everything (from their customer relationship management to their product development processes). This includes, of course, their open innovation and engagement programs. Back in 2010, a brand survey was conducted by agency BBDO that resulted in the following recommendation: “Most people agree that brands need the input of their consumers, they have to involve their consumers. There is a strong argument to create and implement brand engagement programs, since the results indicate that people expect two way interactive communication between brands and their consumers.”1 “There is a strong argument to create and implement brand engagement programs, since the results indicate that people expect two way interactive communication.” In the years following, this expectation has only become more entrenched in the business mindset: companies must foster community engagement. But it’s not just consumers anymore. The barriers between departments and organizational strata are evaporating, as well – and “engaging” means not just connecting with consumers and end users, but also employees, subscribers, citizens, classmates, and virtually anyone within a network. These people can provide the next big idea that propels a business forward. But to connect with them, do you build your own engagement and ideation tool or do you buy an existing solution? If you don’t want to read the rest of the white paper, we can tell you now that most of the time (and perhaps unsurprisingly) the answer is that it makes more sense to buy a solution than it does to build one. If you want to know “why?” however, keep reading. Reasons to Buy Purchasing a solution (depending on the need and the vendor) will result in various levels of costsavings, a faster time-to-market, less IT overhead, more agility, and the ability to scale (among other things). 1 Claus, Dennis, and Isabelle Stevens. The Brand Engagement Index. Engage BBDO, 30 Nov. 2010. Web. 9 Feb. 2012. <http://www.slideshare.net/nbbdo/brand-engagement-index-most-engaged-brands>.
  • 2. To Build or To Buy? | Page 2 Cost Savings: It’s not just the cost of building the technology (which is, in itself a complicated and weighty cost of time, salaries, and benefits), it’s also the associated costs of maintaining a solution, which can include hardware, rack space, hosting, installation, project management, and more. One study, by Capgemini concluded that purchasing a software solution (as opposed to building one) actually reduced costs by 52%. 2 “One study concluded that purchasing a software solution (as opposed to building one) actually reduced costs by 52%.” Time to Market: Developing a unique solution takes place on a long timeline; committees and project groups take time establishing buy-in, vetting, developing, sourcing approval, and finally, implementing (along with many other steps). The same study by Capgemini stated that purchasing a software solution reduces the time to market by nearly 41% (a number that can be reduced even further when no customization is required). Experts Required: With technology’s multidirectional growth, it is difficult to employ experts in everything. The benefit of purchasing a solution is that the developers that serve a vendor are dedicated to a level of specialized training and expertise in their own subject matter that simply isn’t required of the typical business’s IT staff. This minimizes the number of staff required to run the program. Agility: If a tool requires support or customization, the ability to make those changes is significantly curtailed if a company doesn’t have a team of experts dedicated to rapid build improvements and twenty-four hour support. Implementing new programs always require a period of discovery and if companies can’t adapt based on their findings, it is unlikely that the new program will succeed or will return additional value on an initial investment. Ability to Scale: Vendors that provide purchased solutions are generally accustomed to collecting and managing large volumes of data and have gone through the trouble of working out the kinks inherent in managing a high level of traffic. The benefits of this experience include an increased data capacity, as well as increased productivity on the platform since no one has to slow down in order to keep pace with the flow of information. And as the community grows and evolves, users and administrators won’t feel the associated growing pains. Digital Experience: The end user is far more likely to adopt and regularly visit an online platform that is easy to use and looks professional. The polish that vendors are able to provide is often one of the first things to be sacrificed when a new in-house platform is being developed, whereas vendors have made an investment in design and user experience. 2 Brantz, Carly and Brian O’Neill. “Build Vs. Buy.” SendGrid. 13 December 2012. 11 February 2013. < http:// www.slideshare.net/sendgrid/build-or-buy-moving-your-email-to-the-cloud>.
  • 3. To Build or To Buy? | Page 3 A Time to Build There are times, however, when it is appropriate to develop a new tool and if you can answer “yes” to either of these questions, then it might be time to start building. Do You Have a Completely Unique Business Need? If the solution that a company is seeking requires a level of customization so unique and specific that it demands an intimate expertise concerning your own company, it might be better to build a solution. Certainly no one knows your company better than the people working on it and building it. However, most business processes are not so far afield that they are totally unique and most purchased solutions have customization options that can be tailored to a business’s needs. Is There No Existing Solution? If you truly can’t find an out-of-the-box solution to customize to your needs, not only should you build it, but you should look at the market to see if other people need it, too (perhaps it’s an opportunity for diversification). However, if you also don’t see a need for it in the broader community, one wonders if it’s really a solution that you need after all. IdeaScale: How You Get In Touch With Your Network Used by Fortune 500 companies and small businesses alike, IdeaScale is a social engagement platform for gathering valuable ideas and insights for any business or organization. Having this sort of centralized ideation tool allows organizations to easily manage and utilize all the feedback and ideas a business is getting from its users all the time, anytime,
  • 4. To Build or To Buy? | Page 4 from anywhere. Because of IdeaScale’s commitment to accessibility, it is also priced competitively in order to make the implementation of an ideation program an affordable matter of just a few clicks. In fact, one government agency first spent six months developing their own solution that failed load testing and within the week IdeaScale was able to replace their built system with our own. That community went on to generate over 6,000 ideas with the IdeaScale tool. IdeaScale is a site where a user submits an idea and others vote on the ideas submitted by users and the best idea gets bubbled up to the top. In this way, organizations can ensure that they are in close touch with their network, what they’re looking for, what their needs are, and also what they have to offer. IdeaScale is used by all types of organizations ranging from government agencies to non-profits. And the platform allows for the high-fidelity transmission of ideas that can be acted on in real time. Traditional online research methods and network management tools haven’t been so effective in fostering a sense of community among customers, whereas IdeaScale keeps the conversation going with anyone who wants to join. Additionally, the network is already talking about your organization and sharing great ideas all over the web: on sites like Twitter, Facebook, etc. IdeaScale is a tool that helps manage the conversation while increasing engagement and providing focused, effective feedback for an organization. Meet Expectations Think of it like this. You get home on the weekend after already having worked a full week to find a leak in your basement piping. In spite of being exhausted and in hopes of becoming thrifty and proving your homeowner skills, you spend hours learning what you need to know on the internet, make a frugal investment in tools at the hardware store, and valiantly head downstairs to take care of the problem… and end up flooding your basement. Then you end up calling the plumber anyways, spending significantly more to clean up after your own best intentions. It is hard to argue expertise, a proven track record, ease of implementation, and (in the long run) a lower price tag. It is also unlikely, however, that any in-house software will live up to your own expectations. One 2004 study revealed that less than 1 in 3 in-house programs were able to successfully meet their own requirements.3 Working with a vendor makes it far more likely that not only will they help you avoid making a mess, but they will help you meet all of your original program conditions. 3 “To Build or To Buy? Seven cautions on procuring enterprise software.” Explorance. 12 December 2006. 9 February 2013. < http://www.explorance.com/news_n_views/PDF/Build_vs_buy.pdf>