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Apr 15 2019

Commercial Off-The-Shelf (COTS) Software vs Custom Software: Which one do you need?

Running a business nowadays normally poses a constant dilemma to owners: whether to buy or build software for an enterprise.

The question of going for Commercial Off-The-Shelf (COTS) products vs Custom Software has been a continuous struggle for both growing businesses and small start-ups alike. Not all business processes can be definitive and ramifications cannot be fully foreseen nor predicted that’s why it can be challenging for organizations to decide which path to take.

With the ultimate goal in mind of boosting efficiency with the least cost, let’s weigh both options and figure out which one best fits your business requirements.


COTS Products: Pros and Cons

COTS products are market-ready, packaged software solutions meant for the use of the general public.

The biggest advantage of this software solution is the low upfront costs. Budget is a primary consideration of all businesses which make COTS systems an obvious route for many, especially for start-ups and those working on a tight budget. Plus, COTS software vendors normally offer free trial before purchase.

Another huge benefit of a COTS product is its quick implementation. They are easily accessible and are immediately ready for use usually requiring no design work.

Most COTS products with their generic setup already address most business process support systems. Moreover, if there is a large user base, it may offer an online community which adds up to a strong customer support.

However, COTS products fall short on some important factors.

Since these tools are designed with the mass market in mind, some do not adequately address specific functions. It offers limited solutions where niche business processes might not be met, therefore requiring users to work around the system to be able to achieve their objectives.

Also, unwanted features can come in a COTS package which you may never use but still pay for.

Since you cannot own the rights to a COTS system, there are risks that you have no control over which may jeopardize business processes.

There could also be weaker security for off-the-shelf software with the program being widely available and the source code more prone to being hacked.

Upgradability, enhancements, and additional plugins in COTS packages can also end up to be more expensive, if at all possible, to accommodate your future needs.


Custom Software: Pros and Cons

Custom or bespoke software solutions are specifically developed for a particular organization or business with functions tailored to their unique requirements. It can be mapped and integrated to your existing systems and be as simple and straightforward as you need it to be.

These tools are used to fulfill special and additional features that may or may not be available in COTS products.

Custom software is designed to increase efficiency and optimize performance towards your business goals. A proper bespoke system should be able to completely support your existing business structure while ready to support future needs. With this, you have complete control over scale, function, and modifications.

Bespoke software also allows for competitive edge since you can have unique solutions that cater to very specific concerns in the market which may not be currently addressed.

Along with all these great benefits, custom software comes with a few drawbacks.

Custom software amounts to a higher upfront cost simply because development of the software requires more resources. It involves a team of developers to be able to fully come up with a complete and effective system.

It typically takes longer to build factoring in the time needed to design, setup and implement which may be a downside for organizations who are after immediate solutions.


Which one do you really need?

It all depends on your business requirements and your long-term goals. Observe your current business processes and evaluate what specific matters you want to improve on. Consider potential growth internally as well as industry dynamics before deciding.

The 80/20 rule is a guideline used by many organizations in the “build vs buy” software dilemma. According to a LinkedIn article, a product should satisfy at least 80% of your requirements otherwise it falls short on your business needs. However, even if you find a solution that solves 80% of your needs, you may still need to work on the remaining 20% especially when that 20% makes all the difference.

Simply put, if your requirements are generic enough, COTS solutions may be your best bet. With all the new program releases and upgrades available, you will definitely find something that can help.

However, if you’re in the industry that requires specialized business processes to effectively operate, and if you want to do something “revolutionary,” custom software is the way to go!


Let’s talk about how our customized business solutions can help you stay on top of the game.