Alright folks, buckle up, because today we’re diving into a question that is sure to cause some conversation and is always talked about in ERP implementations: Do you buy an ISV solution, or do you build it yourself? If you’re part of the Dynamics 365 family, this is no small decision. It’s right up there with “should we customize or keep it standard?” and if you’ve been in the game for a while, you know how that one usually goes…
So grab a cup of coffee (or something stronger, depending on how many “We can’t customize” meetings you’ve had this month) and let’s walk through the ultimate decision-making process for buying vs. building.
With this detailed analysis, you’re armed to make an informed decision. Remember: whether you buy or build, the key is to balance cost, time, and strategic alignment. As DynamicsDad would say, “Measure twice, implement once!”
Step 1: Let’s Talk Cash Flow (Because Dad Knows the Value of a Dollar)
Cost Matters, But It’s Not Everything
When deciding between buying or building, understanding the full financial implications is essential—not just the upfront cost, but the long-term commitment.
1. Buying an ISV Solution
Initial Costs: ISV solutions come with licensing fees, which can vary depending on the complexity and the size of your organization. Some ISVs operate on a per-user licensing model, which scales up with your company’s growth, potentially leading to higher recurring costs.
Ongoing Costs: Don’t overlook annual maintenance contracts, support fees, and upgrade costs. These can add up, especially if your ISV vendor frequently updates their solution.
Budget Predictability: ISV solutions provide a predictable cost structure, which is ideal for organizations with tight budgets or limited flexibility.
2. Building In-House
Development Costs: You’ll need to factor in the salaries of your developers, the tools and licenses they require, and the potential training if they’re new to the D365 development environment.
Opportunity Costs: Every hour spent on building a custom solution is time taken away from other projects. You may also need to backfill other roles to avoid disruptions in ongoing operations.
Hidden Costs: Consider the cost of debugging, testing, and ensuring compliance with industry standards. Internal builds often have unanticipated expenses.
3. Hiring Consultants
Consultancy Fees: Consultants bring expertise but at a premium. Hourly rates can range from hundreds to thousands of dollars, depending on their level of expertise and the scope of the project.
Efficiency vs. Cost: While consultants may expedite the project timeline, they often require detailed specifications, which can increase the total cost if your requirements aren’t well-documented.
Contractual Obligations: Ensure clarity on post-implementation support—consultants may charge additional fees for future changes or fixes.
Step 2: Think About Time (Because Dad Knows Time Is Precious)
Do You Need This ASAP, or Can You Take Your Time?
The timeline for implementation can make or break your decision, especially if you’re trying to stay competitive in your industry.
1. Buying an ISV Solution
Fast Deployment: Most ISV solutions are plug-and-play, with minimal customization required to get started. If you’re in a hurry to meet compliance deadlines or go live, this is the fastest route.
Implementation Support: Many ISV vendors offer onboarding assistance, which can reduce the time it takes for your team to get up to speed.
2. Building In-House
Development Time: Even a small custom solution can take weeks to months to design, develop, and test. Larger, more complex builds could stretch over a year.
Iterative Cycles: Internal teams often adopt an iterative approach, which is great for refining the solution but can prolong the timeline if priorities shift mid-project.
3. Hiring Consultants
Accelerated Development: Consultants typically follow proven methodologies that can speed up development, but their effectiveness depends on the clarity of your requirements and the availability of your stakeholders.
Knowledge Transfer: Post-implementation knowledge transfer sessions can extend the project timeline, as your internal team needs to learn how to maintain the solution.
Step 3: Assess Your Resources (Or, Is Your Team Ready to Tackle This?)
Do You Have the Right Tools in the Toolbox?
Your team’s capacity and expertise directly impact whether building in-house is even feasible.
1. Technical Skills
ISV Solution: Minimal technical expertise is required to deploy most ISV solutions. However, integration with existing systems might require some know-how.
Building In-House: A strong understanding of D365’s architecture, X++, and related technologies is essential. If your team lacks experience, this option can quickly become overwhelming.
Hiring Consultants: Consultants bring specialized expertise, but you’ll need an internal team that understands the organization’s processes well enough to provide clear guidance.
2. Resource Availability
In-House: If your team is already juggling other projects, dedicating time to building a custom solution may not be realistic. Burnout is a real risk.
Consultants: While consultants fill skill and capacity gaps, managing their work requires effort from your internal team. Ensure you have someone to act as a project liaison.
Step 4: Flexibility vs. Functionality (Swiss Army Knife or Sledgehammer?)
Flexibility and alignment with business needs are critical considerations.
1. ISV Solution
Pre-Built Functionality: ISV solutions often come with a suite of features designed for industry best practices. This can be a pro if your needs align, but a con if you need unique capabilities.
Customization Constraints: While some ISV solutions allow limited customization, it’s often restricted by the vendor’s roadmap.
2. Building In-House
Tailored Solution: Custom builds shine in situations where unique business processes need to be mirrored in the ERP. You get exactly what you want, but this requires thorough requirements gathering.
Future Proofing: Custom solutions can evolve with your business, provided you design them with scalability in mind.
3. Hiring Consultants
Best of Both Worlds: Consultants can build highly customized solutions that address specific pain points. However, miscommunication or unclear requirements can lead to functionality gaps.
Step 5: Support and Maintenance (Who’s On Call?)
The post-deployment phase is often the longest and most critical.
1. ISV Solution
Vendor Support: Most ISVs offer support contracts, but response times depend on your service level agreement. For urgent issues, you may be at the mercy of their schedule.
Upgrades: Updates and new features are handled by the vendor but might come at an additional cost.
2. Building In-House
Internal Support: Your team can troubleshoot issues faster since they built the solution. However, this creates ongoing workload pressure and requires retaining the right talent.
Maintenance Costs: Bug fixes, enhancements, and compatibility updates fall entirely on your team.
3. Hiring Consultants
Support Contracts: Many consultants offer ongoing support, but it can be expensive. Ensure the terms of the contract are clear about availability and scope.
Step 6: Consider the Future (Is This Solution Built to Grow?)
Growth and scalability should be part of your long-term strategy.
1. ISV Solution
Vendor Roadmap: Some ISV vendors proactively add features and scale solutions for growing businesses. However, this may involve upgrade fees.
Potential Limitations: If your organization grows beyond the ISV’s scope, you may have to replace the solution entirely.
2. Custom Build
Unlimited Scalability: A custom solution can be built with your growth trajectory in mind, making it adaptable as your business evolves.
Cost of Upgrades: While scalable, major updates require developer time, increasing costs.
Step 7: Integration (Family Drama in Your ERP?)
The solution’s ability to integrate seamlessly with D365 modules is critical.
1. ISV Solution
Plug-and-Play: Most ISV solutions are designed for D365 compatibility but might struggle with unique configurations.
Data Migration: Expect some effort in data mapping to ensure smooth integration.
2. Building In-House
Custom Fit: Internal builds can be designed to work seamlessly with existing systems, ensuring better integration and minimal disruption.
3. Hiring Consultants
Expert Integration: Consultants familiar with D365’s intricacies can ensure smooth integration, but only if you provide them with detailed system knowledge.
Step 8: Ownership and IP (Who Gets Custody of the Code?)
Ownership impacts future flexibility and independence.
1. ISV Solution
Vendor-Owned: You don’t own the code, which means you’re dependent on the vendor for updates and modifications.
2. Building In-House
Full Ownership: Your organization owns the intellectual property, giving you complete control.
3. Hiring Consultants
Contractual Terms: Ensure that your contract specifies IP ownership. Without this, consultants could retain the rights.
Step 9: Strategic Alignment (Is It a Match for Your Business?)
Does the solution align with your company’s long-term goals?
1. ISV Solution
Standard Practices: ISV solutions are great for aligning with industry standards but might not address niche needs.
Limited Innovation: You’re limited to the vendor’s innovation timeline.
2. Building In-House
Custom Alignment: Internal builds can reflect your strategic goals and give you a competitive advantage.
3. Hiring Consultants
Expert Guidance: Consultants can help align the solution with your strategy, but this requires clear communication and trust.
Final Words of Wisdom From DynamicsDad
Here’s the thing—choosing between buying an ISV solution or building your own custom feature is like deciding between buying a car off the lot or assembling one in your garage. Both have pros and cons, and neither is right or wrong. It’s all about what fits your budget, timeline, and long-term goals.
So next time you’re in a meeting, and someone says, “Shouldn’t we just buy this?”, or, “Can’t our team just build it?”, smile, because you’ll have all the dad wisdom you need to steer the conversation.
Catch you in the next blog,
DynamicsDad out.
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