The Hidden Costs of Building Features In-House

So you’ve finally done it. You’ve decided to take the plunge and address that missing set of features your product has needed for months. You know which features I’m talking about, the ones your customers and sales team have been clamouring for but also the ones that are a lot more complicated than you have time for right now. Being the savvy product manager you are, you’ve chosen not to go with that pricey OEM vendor recommended by your CTO and have instead told your executive team that you can build the same features for a fraction of the price by using just two junior developers. Sounds like a big win, right? But is it really?

The truth is that there are a lot of hidden costs that easily can be overlooked and rarely get considered in situations like these. Let’s look at a few.

On the surface, yes, you probably can get those new developers coding away and produce a MVP of the features in question for less than the cost of a one-year OEM license, but then what? Will the new functionality you’ve built be nearly as robust as the OEM vendor who “does this for a living?” Not likely. Plus, your new functionality is only one of many features that your product offers and is not your company’s focus, nor passion.

By contrast, the features offered by the OEM vendor ARE their focus and their core competency, which means your two developers, even if they’re spectacular coders, will have a hard time competing with the OEM team that probably includes dozens of seasoned veterans that have been working on the same problems for years. As time goes on, your MVP will only fall farther behind the competition, and your future enhancements won’t be providing that “wow factor” your customers and sales team expect.

There’s also the issue of scale. While your team of two is busy serving one customer, you, the OEM vendor has many customers. That means their team is receiving hundreds more feature requests than you, squashing hundreds more bugs than you and has countless more opportunities to improve than you. As technology evolves and changes, the dedicated OEM team has the resources to shift directions, change frameworks and rewrite their code as needed, something your team won’t have the luxury of doing.

So while building your own solutions may look like a better option in the beginning, partnering with the right OEM will always win out over the long run. Both teams can stay focused on their core competencies and are far stronger working together than competing against each other.