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Build or Buy?

Exploring the age-old software question

Exploring the age-old software question

Do you buy or build your software? This is a question that seems simple, but the answer will determine your shop’s philosophy. It can also have a major impact on your profit and productivity, as well as flexibility to changing market conditions.

Building vs. Buying Your Software

Indulge me in reciting a very short history of software development. Once upon a time when computing was very expensive (“isn’t that now?” asks the CFO), most companies couldn’t justify the expenditure for hardware, software and data-processing staff. Companies that needed computing used service bureau (timeshare) services and paid a regular cost for computing services. As companies realized the need for greater control (usually over costs, but sometimes over quality or functionality), they turned to internal resources. Companies had data-processing departments that developed, tested and maintained programs and systems. Eventually, software-development organizations saw the potential for profit in creating software for end-user companies. The software-development organizations did the same tasks as internal data-processing departments, and made their software offerings available to multiple customers. Today, we’re seeing a return to the service bureau or timeshare concept, but now use the term Software as a Service (SaaS) or potentially cloud computing. It’s interesting to see (as a long-time information-systems veteran) that what is old is new again, and the industry continues its cycle of contraction and expansion of computing resources.

We can now choose between three different computing models:

  • Build our software and maintain our computing resources in house
  • Acquire software (and perhaps hardware) from a development company
  • Use the service bureau (SaaS) concept

Most companies probably use a combination of all three, but usually one technique is primary. Let’s look closer—in reverse order.

Use Saas

SaaS is probably the least commonly used technique in IBM i shops for a few reasons:

  • While the technique is the oldest in the computing arena, it had fallen out of favor with many organizations due to the lack of control
  • Many i shops don’t have the infrastructure to use Web services or cloud computing to access resources outside of the organization
  • SaaS isn’t in the mindset of many i shops. Centralized processing on an i system is the norm—the distributed-computing concept is more in the wheelhouse of shops using smaller, single-purpose systems such as Windows, Linux or UNIX systems.

I see this technique being adopted by more and more i shops, but it will probably take an expansion in the number of services offered to enable SaaS companies to penetrate the i market. We are however seeing adoption of SaaS in non-core applications such as CRM and utilities such as shipping (FedEx/UPS) integration, address verification and credit-card processing.

It’s Your Turn. Are you using SaaS? Any plans to implement this computing technique?

Michael Ryan is a technical editor with IBM Systems Magazine. Michael can be reached at michael@ryantechnology.com.


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