Checklist: Building vs Buying Software Solutions Across The Banking Industry
Leading financial institutions debate whether it is better to build or buy software in order to meet a particular business problem that they face. However, it’s important to weigh up both the advantages and disadvantages of doing both when it comes to deciding what will be the most cost-effective solution and what will deliver the most value for the bank.
Building software has often won the argument, but given the enormous challenges that banks currently face to meet the needs of their clients, the tide is turning.
How to decide whether to build or buy software
Running a build-vs-buy analysis starts by understanding your own requirements as well as the conditions that the software product has to meet. Try to write down every feature you think your product needs and then rank them. Furthermore, consider these main questions:
- Is the problem or challenge you face unique and can no existing software address the issue?
- Or is it a common problem and can existing software be customised to meet your needs?
- Can a third-party solution meet more than 80% of the requirements you need?
If there is existing technology that meets your needs, you can usually save a lot of money when buying software as opposed to building it. If the decision isn’t that straightforward, consider these 5 important points.
And don’t forget to stick to what your bank does best – banking. Often banks don’t need to reinvent the wheel, instead, they can simply work with FinTechs to deploy the most cost-effective and best-built solutions faster.