Buy-or-build process automation: how to make the right choice

Business process automation applications have become essential for success in business, regardless of company size. Automation can help optimize operations, reduce costs, and improve efficiency. It can also be a major competitive advantage in a constantly and rapidly changing economic context.

Managers and executives are faced with a key question when it comes to deciding on a business process automation solution: should they buy ready-to-use applications or develop their own?

This decision is not to be taken lightly, especially in view of the information revealed in a recent Gartner report. According to this report, enterprise IT spending will continue to increase with expected growth of 12% in 2023 and 13% in 2024 - in particular for software to obtain competitive advantages through increased productivity, automation, and other digital transformation initiatives.

Either choice can incur a significant cost and the solution chosen has to fit to your vision, your roadmap, and your short and long term objectives.

In this article, we'll explore the pros and cons of an off-the-shelf solution vs developing your own solution in-house, as well as provide advice on what factors to consider and how to make the right choice.

1. What factors should be taken into account when choosing between build-or-buy process automation?

There are several key factors to consider before deciding whether to purchase off-the-shelf applications or use a platform solution to develop and automate your company's business processes. 

• Problem and scope of the project
  Of course you’ll begin by identifying the problem or issues to be addressed and why automation is needed now. Communication with stakeholders such as management and various team leads clarifies pain points, challenges, and areas where automation could bring significant improvements. Their insights and perspectives can help identify business processes that are ripe for automation. For example, stakeholders can identify tasks that are tedious, repetitive, time-consuming, error-prone, or involve large volumes of data. Identify bottlenecks and areas where automation can have the biggest impact. Also look for well-defined, rule-based processes with clear inputs, outputs, and decision points. These will be good candidates for automation.

• Objectives and the benefits you expect to derive from them
  Clearly define the goals you want to achieve through process automation. It could be to improve efficiency, reduce errors, increase productivity, streamline workflows, speed up turnaround times, improve your customer satisfaction, or free up employee time for more useful tasks. Also estimate the number of processes to be automated, the number of users and the level of integration required. Consider the expected ROI when estimating the cost of implementing a new solution (including the estimated time savings from automating what was previously a manual task), the expected time-to-market, the cost of continuous improvement, and the cost of maintenance. This leads directly to the next key point:

• Resources, costs and time required
  Assess the availability of resources within your organization, including qualified technical teams, the budget, and the time available for the project. Having the expertise and capacity to develop custom applications, or to update and maintain off-the-shelf solutions is a major consideration. Calculate not only the initial costs, but also the maintenance costs and the potential return on investment of each of the two alternatives.

• Integration requirements
  Determine the level of integration required with existing systems and applications. In particular, check into whether an out-of-the-box solution can integrate easily with your current infrastructure, or whether customization using developer skills would be needed to meet your integration requirements.

• Technical assistance and maintenance needs
  Evaluate the level of support and maintenance anticipated for the automation project or application. Determine if you have the internal resources and capabilities to provide ongoing support when the app is not performing as expected, or if you prefer to rely on external expertise for support. If the latter, assure that is is available to you.

• Other potential risks
  Consider other associated risks with each option, such as data security and privacy risks. It is also a good idea to evaluate whether there could be a vendor lock-in, or specialized or proprietary technology that may change or not be available for long-life-cycle apps or processes.

2. Pros and cons of buying business process automation solutions off-the-shelf

Advantages

• Faster implementation: Purchasing an off-the-shelf solution can be faster to implement, especially for relatively simple processes,  than developing custom applications. This can result in a faster return on investment. 

• Lower upfront costs: Off-the-shelf solutions are generally less expensive to purchase. Licensing fees are less than the cost of developing a custom, built-from-scratch solution.

• Access to new features following market trends: External software providers generally continue to improve their solutions by adding features, following industry trends, market trends, etc.

Disadvantages

• Limited customization: Off-the-shelf solutions are unlikely to fully meet specific needs and requirements, especially for complex workflows, or core processes that provide competitive differentiation. Because they can’t offer the same level of customization as bespoke solutions, their inflexibility can lead to inefficiencies or workarounds. This is also problematic when dealing with specific information system stacks. Limitations in terms of functionality or flexibility, may force organizations to adapt their processes to the solution, rather than the other way around.

• Integration challenges: Integrating an out-of-the-box solution into existing systems and applications can be complex and time-consuming. It may require additional effort and resources to ensure seamless integration and data flow between the various systems already used by the business.

• Vendor dependency: Off-the-shelf solutions may be dependent on the vendor for updates, support, and future development, which can limit their flexibility and control.

• Risk of obsolescence: Ready-to-use solutions can become obsolete as technology and business needs change. This may require the company to invest in a new solution.

• Limited scalability: Many off-the-shelf solutions may have scalability limitations and not be able to accommodate future growth.

When to buy: some examples of use cases for off-the-shelf solutions

• Use case 1: Ticketing software for customer support
  Ticketing software for customer support or a company's internal support can be handled efficiently using an off-the-shelf solution. Out-of-the-box tools come with ticketing workflows, knowledge bases, and customer communication features, making them easy to implement and use.

• Use case 2: Time tracking
  Purchased HR software is a cost-effective option for automated employee time tracking. These solutions often offer user-friendly interfaces and integration with payroll systems, which helps streamline the HR process without requiring significant customization.

• Use case 3: Expense management
  Expense management processes, such as reimbursement and approval of business expenses, can be efficiently managed using off-the-shelf expense management software. These solutions come with standardized workflows, receipt scanning capabilities, and expense policy enforcement, simplifying financial processes.

3. Pros and cons of developing custom business process automation applications

Advantages

• Customization: Developing a company-specific software solution ensures that it is tailored to specific requirements and processes and not the other way around. This is especially important when dealing with complex workflows and company-specific information systems, as it allows for greater adaptability and efficiency. Custom development also allows companies and organizations to prioritize the features and functionalities that are most important to the business.

• Flexibility: Custom applications allow changes and updates to be made as needs change and the competitive environment evolves, ensuring the solution remains relevant and effective over time.

• Competitive advantage: Developing a process-based automation solution or application can provide a competitive advantage through differentiation. Unique features and capabilities that are not available in off-the-shelf solutions can be included, and the solution can be designed to solve specific problems. Customization also supports process optimization, resulting in increased efficiency and productivity.

• Scalability: A customized solution can be designed to adapt to the growth of the organization and the evolution of its needs. Applications can be more easily expanded or modified to accommodate increasing workloads or changing business needs.

• Integration: Custom applications can be fully integrated with existing systems and processes. This means streamlined data flow, reduced manual data entry, and eliminates the need to process duplicate data.

• Better alignment with company culture and values: A tailored solution can be designed to reflect your organization's culture, values and vision. Better alignment drives user adoption and employee engagement, resulting in increased productivity and satisfaction.

• Security: You are in full control of security aspects and sensitive data can be handled with confidence, reducing the risk of potential breaches. You can also implement robust security protocols tailored to the specific needs of your organization.

• In-depth analytics and reporting: A custom application can collect and analyze data in a way that aligns with your business goals. Generate detailed and relevant reports to identify bottlenecks, track performance, and make data-driven decisions.

• Continuous improvement and updates: A solution developed by you allows continuous improvement and updating. Your team can react quickly to user feedback and changing needs, making necessary improvements faster.

• Long-term cost containment: While developing custom apps can require a large upfront investment, it often saves money in the long run, especially if your needs are very specific, because you won't be paying for features you don't need.

Disadvantages

• Higher initial costs: Development requires a significant initial investment in terms of time, money and resources for development, testing, deployment, support and ongoing maintenance. Upfront costs may be higher than purchasing an out-of-the-box application.

• Expertise: Designing a solution requires specialized knowledge and skills in automation and development technologies. It’s essential to have the necessary expertise in-house, or via an integrator partner. Assessing what technical skills are needed to develop customized applications is also a consideration, as proprietary or platform-specific technology on some types of development platforms may involve additional training costs and more time to learn.

• Time to market: Development takes time, which can delay the implementation of the solution and the achievement of ROI.

When to develop: use case examples

• Use case 1: Highly regulated industry business processes
  In industries where there are specific regulations, industry standards, and specific business requirements, processes may need to be highly specialized and out-of-the-box solutions may not be suitable. Developing custom process automation applications may be the best option as custom solutions can be tailored to these requirements.

• Use case 2: Cross-functional and complex workflows and processes
  When workflows involve multiple departments and complex interdependent processes, developing a custom solution can provide control that inflexible off-she-shelf solutions simply can’t handle. Complex applications with multiple sub-processes can integrate multiple independent systems and data sources to ensure smooth communication and flow of information throughout the organization.

• Use case 3: Unique business logic
  When a business or organization has unique, custom business logic and rules that set it apart from its competitors, a custom application is often the best option. Customized process applications help maintain competitive advantage and ensure that automation aligns with strategy and business model.

• Use case 4: Future scalability and adaptability
  For businesses with growth plans and evolving needs, a custom automation solution can be designed with scalability and adaptability in mind. Automation can be adjusted and expanded as needs change, without being limited by the constraints of an off-the-shelf product.

4. Build or buy a business process automation solution? In brief

The decision to develop or buy a business process automation solution should take into consideration at least the factors outlined above, according to business needs, budget and resources. 

Developing a solution allows more customization, flexibility, and control, but comes with higher upfront costs. Buying an off-the-shelf solution can be less expensive and faster to implement, but can have limitations in terms of adapting to very specific requirements and integration with existing systems.

For a company or organization with a IT stack that is generally standardized, with simple processes confined to one or two departments, buying an off-the-shelf solution may be the best solution. This can also be the quickest way to resolve specific issues at specific stages of your business lifecycle.

On the other hand, to automate complex processes and workflows within very specific information systems, it may be a better decision to develop custom applications.

Business process management platforms like Bonita, an open-source and extensible automation platform that gives development teams the power to meet the most demanding process automation use case, are worth considering when business processes are competitively differentiating, complex, wide ranging, have long life cycles, and require scalability. Extensible development platforms allow you to develop whatever you need, when you need it, and free you from limitations that off-the-shelf solutions cannot overcome.

Bonitasoft understands what business needs to be successful. We’ve built our BPM-based business process automation platform to accelerate business process application delivery for efficiency, continuous improvement, and innovation. Bonita’s flexibility and platform extensibility equips professional developers and DevOps teams with powerful tools to develop highly customized, fully integrated business applications faster. 

Here are 3 ways to learn more:

1. Build highly personalized, process-based applications today, for free, with our open source Bonita Community Edition.
2. See how you can reinvent your business processes with BPM.  Watch our on demand Bonita Platform Demo.
3. Interested in full project lifecycle support and services from development to operations? Try unlocking the power of Bonita Enterprise Edition.  Contact us to learn more.

Bonitasoft knows its business. This article was not created with the use of artificial language technology.