Build vs. Buy Software: Optimize IT Spend for Cost Savings and Agility

In this blog, we’ll explore how making the right build vs. buy software decision can help optimize IT spend, balancing cost savings with quality, speed and talent sourcing to stay agile and maintain a competitive advantage.

In brief:

• Before deciding to build vs. buy software, audit your existing tech stack. You’re likely wasting 40 percent of your software budget on unused or duplicate tools.
• The total cost of ownership trumps the sticker price. Whilebuilding may cost more upfront, buying may involve hidden long-term expenses.
• If you have strong internal development capabilities or affordable external partners, building can deliver better ROI. However, without the right skills, you’ll face project delays, scope creep, and team burnout that erode cost advantages.
• AI and low-code tools are changing the game. These platforms can slash custom development costs but have scalability and customization limitations.
• Buying gets you to market faster with vendor support, while building gives you control over your roadmap and competitive differentiation.

Economic pressures are reshaping the way organizations think about their IT budgets. Rising inflation — averaging about 5.9 percent globally — means that even anticipated increases in IT spending are often just keeping pace with rising costs. On top of that, global IT spending growth forecasts for 2025 have been slashed by half, from roughly 10 percent down to about five percent, driven by rising tech prices and supply chain disruptions.

In this climate, the classic question becomes urgent: Should you build custom software in-house or buy off-the-shelf solutions? Advances in AI, no-code and low-code tools have lowered the barriers to building, but they’ve also introduced new complexities.

This decision isn’t simply technical — it’s strategic. It impacts how you allocate budget, source talent, and maintain flexibility in a fast-paced market. In this article, you’ll learn how to evaluate the build vs. buy dilemma through the lens of cost control, digital acceleration, and long-term value.

The Build vs. Buy Software Dilemma

At its core, the decision comes down to whether you develop a custom software solution tailored to your organization or invest in a ready-made product that promises faster deployment and ongoing support.

Building offers full control over architecture, integrations, and your roadmap but requires more time, skilled talent, and long-term upkeep. Buying speeds up implementation and includes vendor support, though it may limit flexibility and customization as your needs grow. These trade-offs frame the key considerations below:

Cost

Upfront pricing can be misleading. Building may have higher initial development costs, but buying often comes with long-term licensing fees, integration challenges, or hidden costs tied to vendor support and usage limits.

“When you have a general sense of budget at the start of a project, it helps guide what is feasible,” says Mike Murphy, Energy and Utilities Lead at Centric Consulting. “It is important to remember the total cost of ownership (TCO) when it comes to the build vs. buy question.” Consider both the TCO and the opportunity cost — what else could your team be working on if you’re dedicating resources to a custom build?

Quality

Off-the-shelf solutions often come with built-in quality assurance, regular updates, and user-tested interfaces, but they’re designed for the masses. If your workflows are highly specialized, building may help you achieve a higher-quality fit, assuming you have the right development standards and governance in place.

Speed

Time-to-value matters, especially when the business is under pressure. Buying typically accelerates deployment. However, building with no-code or low-code platforms is changing the equation, making custom development significantly faster than it used to be, especially for internal tools or dashboards.

Flexibility

Will the software adapt as your needs change? With a purchased product, you’re tied to the vendor’s roadmap. With a build, you own the roadmap, but you also own the upkeep. If flexibility and futureproofing are top concerns, this tradeoff becomes central to your decision.

Ultimately, there’s no one-size-fits-all answer. But by framing the build vs. buy decision through the lens of your business strategy and IT capacity, you’ll be better equipped to make a choice that supports both cost optimization and long-term agility. That said, before you commit to building or buying something new, it’s worth asking: Are you getting the full value from the tools you already have?

Maximizing Value From Existing Tools

Before you build or buy something new, evaluate your current tech stack. One of the fastest ways to optimize IT spend is to identify and eliminate duplicate tools and unused licenses.

According to Productiv, the average SaaS portfolio includes around 342 applications, but 40 percent go unused or have overlapping functionality. That’s a significant chunk of your budget tied up in tools that aren’t delivering value. If you haven’t audited your licenses recently, you may be overspending.

Start by asking:

• Are there multiple tools serving the same purpose across different departments?
• Are all license tiers actively used, or are some users overprovisioned?
• Are legacy tools still being paid for even though new ones have replaced them?

Common overlaps often occur between large enterprise platforms like Microsoft 365 and Salesforce, especially when departments onboard their tools without centralized governance. For example, your marketing team may use a third-party analytics tool while your CRM platform already includes similar capabilities, leading to redundant spend and fragmented data.

Regular assessments of your existing software portfolio can help you reclaim budget without sacrificing functionality. You can then reinvest those savings into higher-impact initiatives — whether funding a new build, upgrading a critical tool, or increasing agility across your tech stack.

Of course, reclaiming budget is only one part of the equation. When you decide to build or buy software, your next challenge is figuring out whether you have the talent to execute — and whether building in-house is truly the more cost-effective path. Let’s take a closer look at how talent sourcing can shape the financial impact of your decision.

The Hidden Costs of Capability Gaps

Your talent pool is one of the biggest cost drivers in the build vs. buy decision.

At first glance, buying software might appear cheaper — no development cycle, instant access to features, and vendor support. However, if you have a strong internal development team or access to cost-effective external partners, sending a team to build in-house may yield long-term savings. Especially when customization, integration, or owning your product roadmap is vital.

On the flip side, lacking the right talent and overloading your team can drive hidden costs, including delayed timelines, scope creep, and burnout, leading to team turnover. Unfortunately, hiring isn’t getting any easier: IDC projects that by 2026, more than 90 percent of organizations worldwide will experience IT skills shortages, resulting in an estimated $5.5 trillion in losses from slowed product delivery, lost competitive power, and missed revenue.

That means your talent strategy isn’t a footnote. It’s a core cost driver in the build vs. buy decision. Here’s how to think about it:

• Do you have the engineering, DevOps or platform skills to build well and sustain that build long-term?
• Is your team already at capacity, or would a new build cause disruptions across other critical work?
• Can you recruit or contract the right talent efficiently, without paying a premium that erodes cost advantages?

When talent is strong and available, building may offer more control and long-term savings. Otherwise, buying may help you move faster and reduce risk.

That said, your talent pool is only part of the equation. The rapid evolution of AI and low-code/no-code platforms is also changing what’s possible — and what’s practical. In the next section, we’ll explore how these tools reshape the build vs. buy software landscape and what you need to know to make informed, future-ready decisions.

Emerging Tools Reshaping the Build vs. Buy Equation

Thanks to no-code and low-code development tools like Microsoft Power Platform and Power Apps, and Salesforce Lightning Platform, “Suddenly, business processes were easier to create for the non-technical business user,” says Larry English, our CEO and Co-Founder.

These platforms continue to shift how organizations approach custom software development, often making the build path faster and more flexible. These tools can accelerate development timelines, reduce dependency on high-cost talent, and provide flexibility in how organizations create and adapt solutions. But they also come with constraints you must consider carefully before moving forward.

AI-assisted development can accelerate coding and testing, while low-code tools empower teams to launch applications quickly. For example, AI-enabled Minimal Viable Products (MVPs), or AI tools that reduce time, cost, and technical expertise needed to create functional software prototypes, can cost as little as $5,500 — a fraction of traditional custom builds.

Still, these tools come with trade-offs: scalability limitations, reduced customization, and hidden infrastructure costs like third-party APIs or cloud computing. They may suit internal tools or prototypes but fall short for core business platforms.

When evaluating whether these tools are right for your organization, consider the following:

• Time to value: Will AI or low-code tools help you launch faster than buying an off-the-shelf solution?
• Long-term viability: Can the solution scale with your business, or will you eventually need to rebuild?
• Resource alignment: Do you have the right mix of internal talent and support to maintain what you’ve built?

In some cases, these technologies can make the build path more attractive, particularly for lightweight internal tools or rapidly evolving business needs. In others, their limitations may reinforce the case for buying a mature product that meets enterprise requirements out of the box.

The key is knowing how to evaluate those trade-offs in the context of your organization’s broader goals. In the next section, we’ll explore how to balance cost savings with business needs and how to determine when building or buying will deliver the greatest long-term value for your team.

How to Make the Right Decision

There’s no one-size-fits-all answer to the build vs. buy question. The best choice depends on how well each option aligns with your IT strategic plan, including your business goals, budget and internal capabilities.

If speed to market is a priority and the functionality already exists, buying may be the faster, lower-risk option. But if the solution needs to be tightly integrated with your systems, or is central to your competitive edge, building could offer more long-term value.

Before you make a decision, consider:

• Your business priorities: Is this a short-term fix or a long-term strategic investment?
• TCO: Including licensing, maintenance, infrastructure and support.
• Team capacity: Do you have the right talent and time to support a custom build?

In some cases, a hybrid approach — buying a core platform and building custom components— can balance speed, control and cost-efficiency.

Conclusion: Build Smarter, Buy Wisely

The build vs. buy decision isn’t only about software. It’s about shaping your organization’s future with intention. Every IT investment you make should support your goals, stretch your resources, and position your team for what’s next.

By carefully evaluating costs, internal capabilities, and the evolving technology landscape, you can make decisions that protect your budget and enhance your agility and competitiveness. Whether you build, buy, or blend the two, the key is ensuring your approach aligns with what your business truly needs today and tomorrow.

We understand the pivotal role of IT in driving business value. We can work closely with leadership and IT teams to align technology with business strategy and help you discover the ROI that cutting-edge technologies can offer. Let’s Talk