When is a Custom App The Right

Choice?

Refuse to Fail

Off The Shelf – The Default• OTS – Default solution for

business automation• Even when it is not as efficient

or focused as it should be• How many SMB’s start with

MS Office suite to manage their business• ”Graduating” to apps like

Salesforce or Zoho Office• How many continue with

these solutions long after they no longer “fit?”

Off The Shelf – The Default• What opportunities are

you missing? • What are the downsides,

risks and rewards in business software investment • Custom & OTS?

It Starts with a Simple Need…• We need to bring together items or costs for a sale• We grab Excel

• We need to share the punch list with our team• So we add a little detail and email a copy to each member

• We ask for an update on progress• Copies of the spreadsheet come back. Some have additional

columns for hours, status & issues. Some don’t• Eventually the chain of casual spreadsheets becomes a

process• Bound together with customer, job and version numbers

Our Process

It Starts with a Simple Need…• For a while – it works.

• We add and modify templates• Versions break into different types for different situations

• Then we wake up• We’re wasting a lot of time managing our services• Consolidated reports have to be manually generated from many versions

of sheets across several jobs• We want to change but…

• We have a process and it works (sorta…)• Our data is all over the place and not a simple, structured set

• Knowing what we do and what we need are two different things

Our Process

We Graduate to Market-Driven Solutions• Getting past the first

hurdle – • a bunch of ad-hoc

adaptions using an OTS office productivity apps to a SaaS or OTS app that is more of a fit is just one step of many

We Graduate to Market-Driven Solutions• Broad market apps have many

compromises to navigate• A process step may be critical for

one group but hard to add in ways that don’t confuse or burden the majority of users

• More choices and features may be good for some but feature bloat for others

• The feature that was advocated by a small, vocal group can end up being forgotten – rarely updated or maintained

We Graduate to Market-Driven Solutions• On the buyer side – selecting

the right application is a balancing act• Address critical (but not all your

needs)• Adapt to a big, we-do-it-all solution

that gives us an overwhelming set of choices and decisions at every turn

• We might select an app for a specific need – but when we do we’re often faced with integration issues. How do we pass data to other apps?

We Graduate to Market-Driven Solutions• If we select an app that we

need to adapt for consolidated reporting or that doesn’t quite fit our process…• We find ourselves using

workarounds – spreadsheets, handwritten notes, emails, etc.

• If we’re not careful, we end up right back where we started but with more confusion, process overhead and costs

We Graduate to Market-Driven Solutions• But – it doesn’t always end up

this way. • A standard OTS solution can be a

perfect fit for accounting & HR needs

• Companies handling inventory and shipping can find many alternatives, some specific to their industry or easily adaptable

• And there can be side benefits to adopting industry standard solutions – like recruiting. You could have a pool of proven, skilled users to select from…

So – How Do We Know? When is it time to consider a custom application?• All software is an investment at some level

• A widely used SaaS or packaged solution is an investment in a specific set of features, processes and data management• It may be a recognized expense for accounting purposes, but your business still

needs to adapt processes and procedures to match the assumptions in the app• Once you have implemented, you need to continue to invest in training,

refining processes and standards to maintain a fit with the application• Your data and integration possibilities are “locked” in the application solution,

even when you can extract and hold data locally• If the application addresses a lot of situations beyond your needs – you may be

paying for more value than you can justify over the long run• As your business and the market evolves over time – the application may or

may not continue to meet your needs. Your business changes and so does the market the application addresses…

So – How Do We Know? A checklist of considerations for your investment• If every application you

adopt is an investment, what are some of the key points to consider? • Long term vs short term• Beyond initial costs• Strategic fit & competitive

advantage

Market Solutions May Be Cheaper…• At least initially

• Often cited, but rarely examined over the lifetime of the solution

• What will the lifetime costs be considering licenses and seats (consider growth)?• There are often breaking points that

can push you into enterprise pricing and costs beyond your reach

• What are the costs of implementation, training, adaption, integration, and maintenance?

• What will be the cost to migrate to another solution if you need to?

You Can Buy & Use in the Same Day…• This is a lot less likely than it once was• Market-driven solutions conquer markets two ways

• Add features to capture more markets and “edge” cases• Become more focused and targeted to reach deeper into niche situations

(generally higher license costs)• Either path requires more from users

• More training and adaption to fit the application• Longer implementation projects and more effort to maintain internal adaption

without adding workarounds• If your driver for a selection is quick implementation & low training

costs – it may be a lost cause from the beginning. • Time from technical implementation to full production is generally longer than

you imagine

An Existing Solution May Meet the Majority of Your Needs• Certainly true in many

situations and for some business areas – this is enough to make the choice• Do you really want to try to

manage accounting or personnel issues across many jurisdictions and changes in regulations?

An Existing Solution May Meet the Majority of Your Needs• But – in other situations

• A solution that fits today might not scale or continue to evolve in the same direction as your business

• Most companies do not have enough influence to change the direction of a packaged solution

• Your size and business maturity are important issues to consider. • You may not fully understand your

needs. If that is a consideration, how much you invest now is a serious concern

Data Portability and Integration• May not be an issue now –

what about the future?• If you have one or two core apps

this may not be an issue• As your business scales and/or

you bring in additional apps• Moving data between apps may

be possible with APIs and webservices

• But – integration has a cost and if your apps are proprietary, they may require vendor professional services (with higher costs)

Data Portability and Integration• If you outgrow a solution

• If you need to move to another system, can your data move with you?

• If you can extract your data – what will it cost to transform it to the structure of the new application?

• There can be may (unpleasant) surprises in data migration between proprietary solutions• Data lock-in can be a nasty

animal to contend with

Reporting May Be Good Enough Initially• Can it continue to grow with you?• A commercial app will usually have a reasonable reporting

package for the app itself• As your business grows and you add additional applications

and systems – will it continue to meet your needs?• In most cases the integration & rationalization of data

between applications will require custom development or manual processes to extract useful reports• The larger and more complex a business becomes, the more

of a burden this will be

Custom Software is Often More Expensive Initially• And development isn’t an

end to your costs…• All software is an investment

- and not a one-time cost• Custom apps have a built in

advantage however• They address your needs

directly and generally require less adaption

• They can evolve over time to continue to meet your needs

Custom Software is Often More Expensive Initially• But – if you don’t budget for

maintenance, updates and evolutionary change• Custom apps will eventually

become restrictive and not cost-effective to retain

• All automation projects have a lifetime cost and need to continue to evolve with your business – without holding you back• ROI is always a consideration

Integration & Extensibility• Under your control in custom

applications• Seldom discussed but can be

a significant time and cost factor in custom apps• Key is deciding what is core and

necessary in your app• Do you need a custom

payment solution? • Or can you integrate an existing

service that can handle transactions transparently?

Integration & Extensibility• Integration with 3rd party

solutions can allow custom apps to only need to provide the proprietary glue, process and data to provide necessary functionality• Mapping, shipping & delivery,

supply chain management, etc. • Can greatly reduce initial

costs and flexibility – now and in the future

Unfair Advantage?• Every businessman wants one.• A custom app can embody your business value and

competitive advantage if it addresses your core processes and customer services

• Requires careful planning and thought – • A full scale development project to solve all your problems

isn’t a guaranteed success• Building functionality incrementally and gaining a better

understanding by leveraging feedback – using agile and lean methodologies – is a better way to insure custom app ROI and competitive advantage

A More Natural Fit? • A custom app can account

for your processes and assumptions – requiring less rethinking and realignment • But, it is also an

opportunity to streamline and rethink your assumptions instead of simply automating a process of tunnels and dead ends

A More Natural Fit? • And – assuming you cannot know

everything the day development commences... • Custom apps can (and should) be

extensible and flexible over time• Your customers need more reports,

direct access to inventory levels (etc.) – it is your software. The need can be addressed.

• And it is an opportunity to leave some “nice to have” features on the table• Allow users to try a more streamlined

version and learn what they really need.

Custom Software is an Important Opportunity• But it isn’t necessary for every situation• It can be an important business advantage

• But only if you address your core business value and avoid features better addressed by third parties or outside services

• Some will say you need in-house technical expertise to make the effort successful• But if you have a clear understanding of your business and market - a

technical development partner can help you avoid the distraction and time required to acquire and manage resources

• If you decide to move forward with a custom project• Use Agile & Lean methodologies – build incrementally and evolve• Understand software is an investment – but if done right – the ROI can be

quite high

We’d Like to Help• Scio provides end-to-end engineering

services• A collaborative partnership to ensure

your team is an integral part of solutions

• We’re flexible• From assessing your needs to

developing, implementing, maintaining solutions – we can offer as much or as little help as you need

• Our teams can work virtually or on your site – or a blend of the two

United StatesCorporate Offices

8920 Business Park Dr. Suite 250Austin, Texas 78759

Local: +1 (512) 538 0512Toll free: +1 (800) 642 6134Fax: +1 (831) 309 5803

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Las Cañadas 501, Int. 230Col. Tres MaríasMorelia, Mich. 58254

Tel 1: +52 (443) 310 9601Tel 2: +52 (555) 350 0585

Email: info@sciodev.com sciodev.com