It’s a common question IT and business leaders struggle with: Should they buy a software package off the shelf or build their own? This question comes up when they’re tackling a variety of business problems, including contract management.
The idea of building your own contract lifecycle management software can seem attractive. It provides complete freedom and control to build a custom solution that will meet all of your company’s needs.
But there are some fundamental questions every business needs to ask before making the decision to build vs. buy a CLM solution.
1. Do you have time for software development?
Developing proprietary software requires a lot of time; one estimate ranges from four to nine months, depending on the complexity. That includes planning, scoping, engineering, integration, and testing. You also need to take into account many security and data protection regulatory requirements, which add additional steps to the development process.
Despite best efforts, software development projects often get sidetracked. Delays in software projects are common. According to research by the Standish Group, only 29% of software projects are completed on time, on budget, and with a satisfactory result.
So if you need a CLM solution quickly, the DIY approach may not be the best choice. Off-the shelf software can be quickly deployed, giving you the peace of mind of having an immediate solution that meets your needs. This gives your sales reps the tools they need to close deals faster. That’s especially critical in today’s world of B2B sales, where customers quickly lose patience with any delays.
2. Do you have the money?
To develop your own CLM, you’ll need to have the right software expertise, either in-house or by hiring outside consultants. The cost of that expertise adds up quickly. If you stay in-house, you’ll need to recruit, hire, and maintain a development team. Outsourcing has its own set of challenges, starting with finding a trustworthy partner that has experts with the right skills.
According to research by McKinsey and the University of Oxford, 45% of large IT projects run over budget, with software projects running the highest risk of cost and schedule overruns.
In addition to developments costs, there are maintenance costs. How much will it cost to keep up the custom solution over the years? You’ll need a dedicated support team to ensure your CLM software is up to date and working optimally so the contract process doesn’t slow down deals.
These costs are hard to predict. It’s much easier to calculate the total cost of ownership of a software subscription, which includes constant updates and maintenance.
3. The innovation factor
If you develop CLM software in-house, you’ll be working from a narrow scope, based on the expertise of your development team. A software vendor, on the other hand, incorporates best practices and innovations from the broader industry.
A third-party solution provides the benefit of an enormous amount of research and development, and continuous improvements driven by the experience of many users. An off-the-shelf CLM can help your business adopt more efficient business practices instead of simply meeting your current needs.
4. Are you building for the future?
If you’re building custom software in order to have a system that meets your specific requirements, it’s easy to focus on current needs. However, software that works for 100 users may not work so well for 500 users. It’s important to consider not just today’s needs, but what you may require in the future as your business grows.
The right commercial CLM automation solution helps you address your current requirements, but also can easily scale to meet future demands.
5. Do you need integration with other systems?
Your CLM system likely will need to integrate with other systems, such as configure, price, and quote (CPQ) software. Building those integrations adds time to the software development process, plus your team will need to maintain them. Off-the-shelf CLM can come with pre-built integrations into CPQ or back-end systems, which saves you time and money.
Find out more about how an automated CLM solution can help your business today and in years to come.