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Overview:

* When hiring a company specialized in software development, a question may arise: should I choose custom software or off-the-shelf software?

* Both models have advantages. However, for greater long-term growth, software customization is usually the better choice.

* Learn more below and see which option best fits your company’s current moment.

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There are many types of custom software and off-the-shelf software in the world—just as there are many types of companies.

Saying one is better than the other without understanding each business context is a waste of time, since the differences between each option align with different business objectives.

To avoid frustration in the selection process, the recommendation is to rely on the help of a specialized company for a deeper consultancy on the characteristics of each product.

That way, the risks of ending up with a final software that doesn’t please the company—or the audience—can drop significantly.

So, before reading this or any other article about the topic, remember: there is no universally “better” or “worse” option.

Choosing between custom software and off-the-shelf software depends much more on your goal than on the format itself.

What to consider when choosing custom software or off-the-shelf software

One of the main characteristics you should think about before choosing a custom or off-the-shelf model for your company is whether the business works with a fixed scope or an open scope when developing and improving new systems.

The software provider will generally use both models—fixed scope and open scope—because demand will dictate which one makes more sense.

There are research and innovation projects, for example, where it’s impossible to estimate the timeline (since technologies are new and uncertain, requiring many tests and iterations), as well as projects surrounded by complex or unpredictable details.

Choosing a scope before running a Proof of Concept for this type of project can be a major strategic mistake.

The battle between open scope and fixed scope

Most companies prefer to work with fixed-scope software, and there’s a special reason for that: predictability.

At X-Apps, when we work with mobile and web technologies, software development time can be estimated more accurately, because each project has technical documentation, allowing us to know how long each feature takes to build.

In these cases, the work is more about construction, without research or trial-and-error, because we’ve delivered the product dozens of times—and we know how to handle it.

Fixed scope has its pros and cons, but the biggest win for the end client is having a very accurate estimate of how much the project will cost and how long it will take to deliver.

In open scope, that kind of estimate is impossible.

For that reason, many companies only develop fixed-scope projects and leave research and innovation to specific departments created for that purpose.

And when the software consultancy provider is strong, all those departments can be supported thoroughly.

In both fixed and open scope, it’s common to work with weekly deliveries, well-defined priorities, and functional demonstrations at each stage.

Pricing for both models also doesn’t vary that much, changing mainly the contracting format for open versus fixed scope.

Final negotiations take into account business culture, strategies, and different visions of how the project should be done.

What are the advantages of choosing custom software?

1. Faster implementation

Choosing custom software comes with several advantages and benefits.

A very common doubt when choosing between custom software and off-the-shelf software is about implementation time.

However, it’s fairly simple to understand.

So-called off-the-shelf software usually requires a longer implementation time, mainly because it comes with many functions that can confuse professionals at the time of use.

Because of that, more specific training is often required for each feature, and that can delay your company’s gains.

Since this can compromise team productivity, custom software is easier and more suitable in many scenarios.

In that case, the project is divided into stages and executed through an implementation roadmap.

At first, an MVP is developed to meet the most important demands for your company; later, more functionalities are added.

Because of that, the adaptation time is used better.

2. Custom software is designed to meet your needs

Another interesting advantage is how well it can meet your company’s needs.

When you look for a company specialized in software development, a series of diagnostics about your idea are performed so the provider can better understand what you need from the software.

From there, it becomes possible to identify which features are priorities for an MVP of your idea within the proposed timeline.

In addition, this is when the project scope is defined and the budget is built.

Because this is a more detailed and specific development process, the product is fully oriented to meet your market needs, increasing your results and improving your company’s organization right after implementation.

3. Custom software = better cost-benefit

When choosing between custom and off-the-shelf software, it’s important to consider the cost-benefit of each.

For many of the reasons described above—such as addressing your needs and shorter implementation time—choosing custom software ensures better cost-benefit for your company.

But why?

This type of solution may have a value that seems high at first, but in the long run it ensures greater savings of your business resources.

That happens because new updates are always in progress and can be added to the initial project, whether to fix issues or to add new features when needed.

That way, unlike off-the-shelf software, the system can keep up with the company’s growth—whether through launching new products or facing increased demand, especially when the number of customers grows.

So, what’s the verdict?

Today, many companies don’t want to contract open scope and, because of that, fixed scope is more common.

Still, both present a strong set of similar advantages—and, again, each company’s goals need to be considered before deciding between custom and off-the-shelf software.

At X-Apps, we can mention the example of Suzano Papéis e Celulose, a company that created an internal committee to discuss every software need that emerges across teams.

For each new demand, they research off-the-shelf solutions and also ask us for timelines and costs to build custom software from scratch.

In this client’s case, the second option usually wins, offering far more flexibility than what we call “shelf software”.

However, when the need is more basic, off-the-shelf is precisely what best fits the possibility of generating results for the customer.

Want to know what would be the best option for your business?

Talk to us! We know everything about custom software and we want to help you make the best—and most profitable—choice for your company.