Software as a service (SaaS) or custom software?
A company that needs software faces a fundamental choice: whether to buy a subscription and use some available software as a service, or commission the creation of its custom application. Below we will try to define both solutions and describe the advantages and disadvantages of each.
Software as a service (SaaS)
Software as a service (SaaS) is ready-made, previously created and owned software that is made available to external users (e.g. companies) as a cloud service, usually available to the client via a web browser. You have to pay a subscription to access this service.
Advantages of SaaS
- Quick start. It is generally easy to hire such a service and start using it.
- Low initial cost. The first instalment of the subscription is usually not a high cost for the company. Sometimes there are also promotions for the initial period of using the service.
- Maintaining the server on which the service is based, continuity of the service offered, and backup - are the problems of its owner.
- The available features can sometimes be inspiring and show how a less experienced company should work.
- Sometimes you can adjust the scope of the rented service by selecting the appropriate option and subscription.
Disadvantages of SaaS
- The initially low cost of software as a service regularly adds up to a significant amount over time.
- SaaS is offered as “one size to fit all”. Therefore, it is impossible to adjust the service to the individual needs of each company.
- The lack of SaaS functionalities needed by a given company may involve the need to carry out some operations outside the service, or hire another service for some activities, which multiplies entities, wastes time and causes additional problems.
- Even if SaaS has the functionalities needed by a company, they are often implemented in a way that will force it to modify its operations, standards and habits.
- Many unnecessary software functionalities - services only make it difficult to use. For example, the users only need a few basic functions, but they have to search for them in the thicket of extensive menus.
- No possibility of integration with external systems, unless the service provider has provided it.
- Inability to create the reports needed by the company, unless the existing reports are suitable.
- No possibility of integration with a mobile application if the service provider has not created the appropriate API. Even if there is an API, it may be imperfect, truncated, or untested (we know such cases from our own experience) and creating a mobile app that works with the service will be difficult, if not impossible.
- The data entered by the company are kept on the servers of the service owners, so theoretically someone can have access to them. This is not a recommended option if your data are sensitive.
- The owners of the service can close it or change it at their discretion - which will be a serious problem for some customers.
Some of the above disadvantages also apply to ready-made “boxed” applications installed on client computers.
Custom software
Custom software (also known as bespoke software or tailor-made software) is custom-made software for a specific company or person, strictly tailored to its needs and requirements, or at least to the scope of the project set at the beginning.
Advantages of custom software
- The cost of creating bespoke software, within the agreed scope, is one-off.
- A custom application is "tailor-made" for a specific company. If the company's requirements are well thought out and specified, then an application created accordingly to them has a bigger chance to optimize the company's operations. We have case studies, where our clients’ operations were optimised by 50 - 120%.
- Tailor-made software reflects the way the company works and is adapted to it, and not vice versa. So it is more convenient than SaaS.
- A custom application contains only what its users need. It is clear and easy to use.
- Custom software can contain all the functionalities needed by the company in a given area. So there is no need to use other software.
- Custom software can be integrated with various external applications - immediately during its development, or later.
- All the reports needed by the company can be included in the software from the beginning or added later.
- It is easy to create software together with a custom mobile application. You can also modify it later and develop a mobile app for it.
- By ordering a custom solution, the customer becomes its 100% owner, and obtains source codes and the ability to modify the software according to their discretion.
- The owner of a dedicated application has full control over the data stored in it on their or a rented server.
- Certainty of maintaining the dedicated software as long as its owner needs it.
- You have your own branding in your own application.
Disadvantages of custom software
- The need to find the right company that develops bespoke software.
- Higher initial cost (needed to develop the dedicated software) than the cost of renting SaaS.
- Software development takes time, usually several months.
- It is required to involve the future owner of the custom application in the process of its creation, especially at the beginning of the project (specification of requirements) and at the end (testing, acceptance).
- Lack of good consideration and specifying your needs may result in the creation of an application that will be ineffective and imperfect.
- The need to maintain a server for the custom application (although renting it usually does not generate high costs), and data backup (often done by the owner of the rented server).
What is best for me?
If you are a new small business, have a limited budget, need a fairly standard application and there is a SaaS that includes the features you need – this is the option for you. An example can be online stores, where there are many standard solutions for rent.
However, if:
- Your needs or way of working are specific.
- You need unusual or extended functionalities of the application.
- You also need a mobile application
- Or you want to have full control over the application and the data stored in it
— then the best solution for you will be to order a “tailor-made” application.
By creating your own application, you have it more convenient, better suited to your needs, and you have your own branding in it.
What do you look and feel better in: tailor-made or rented clothes?
