The Build or Buy Decision - A practical guide from Numara Software

The Build or Buy Decision A practical guide from Numara Software Contents 1. Introduction 2 2. Considerations 3 The Right Help Desk Choice: Should I Build, Buy or Host? Important Considerations Involved in a Build, Buy or Hosting Decision? Costs, Benefits, Flexibility and Technical risks 3. The Build Decision 4 Misconceptions: Building on existing Lotus Notes, Microsoft Outlook and Excel Difficult to Develop Functions Fine-Tuning the Build Solution Hypothetical “Build” Case Study 4. The Buy Decision 6 What to Look for When Buying Helpdesk Software Key differentiators Vendor Value 5. Sample ROI Analysis 7 Build-VS.-Buy Using Numara Track-It! and Numara FootPrints Numara Track-It! ROI Numara FootPrints ROI 6. The Hosting Option 8 The Small to Medium-Sized Business (SMB) Individual Service and Support Departments (within large organizations) Service and Support Outsourcers and Consultants 7. Sample ROI Analysis 9 Hosting-VS.-Purchase Numara FootPrints ROI 8. Numara Software Solutions 9 The Bottom Line Conlusion 10 1. This white paper discusses some of the key considerations that must be carefully evaluated in order to determine the best approach for your organization. – Tony Thomas, Senior Product Manager, Numara Software Inc 1. Introduction IT planners are faced with a critical business challenge when Numara Software, Inc. (formerly Blue Ocean Software) is a it comes time to designing and optimizing a new help desk global provider of service desk management solutions for IT and infrastructure: build, buy or host? This is a question many support professionals who need to simplify and gain control over organizations must answer as their technological needs grow their increasingly complex environments. Recognized as experts and their business environment changes. Before help desk in the help desk industry, Numara Software has deployed its vendors brought reliable, cost-effective solutions to this space, fltagship products, Numara Track-It! and Numara FootPrints, at decision makers of the past had no choice but to commission over 50,000 customer sites worldwide-more than any other in-house or outsourced development teams to build---from help desk provider. gathering requirements to actually programming ---software themselves. This approach typically resulted in projects that If you decide to buy or host, Numara Software can assist with a overshot schedules or were over budgeted, resulting in poor suite of trusted solutions to make your help desk a return on investment (ROI). strategic business asset. This includes addressing critical IT and support functions, such as customer service desk, Today the story is different; there are more choices available. IT IT help desk, asset management, software patch and departments can develop their own help desk solution built on deployment, and network monitoring. widely available software platforms; they can select from a range of packaged solutions, or they can obtain help desk capabilities from a hosting service—an option that was not available until a few years ago. Along with these new choices come new planning challenges as the help desk is now more central to IT than ever before. This white paper discusses some of the key considerations that must be carefully evaluated in order to determine the best approach for your organization, particularly if you are replacing Tony Thomas a legacy help desk system. While there’s no one-size-fits- Senior Product Manager, Numara Software Inc all answer, this white paper will discuss the risks involved in developing (i.e., building) a help desk software solution from scratch vs. buying help desk software from a proven, established vendor. This white paper will also illustrate that hosting can be a viable option for organizations with limited help desk staff or for companies that either lack administrative resources or choose not to budget the upfront hardware costs of a purchased solution. 2. The Build or Buy Decision Individually, the four components — cost, benefit, flexibility, and risk — provide only one piece of the decision-support puzzle. Enterprises with specific needs should place different weights on different categories. – The Financial Impact of Packaged Applications, Forrester Research - July 2006 2. Considerations The Right Help Desk Choice: Should I Build, Buy or Host? Industry trends support the need to do a thorough assessment Important Considerations Involved in a when deciding to build, buy or host a help desk solution. Why? IT is now central to business. As Forrester Research analyst Build, Buy or Hosting Decision Thomas Mendel states in The IT Management Software Market Listed below are a more complete set of parameters to weigh in (Forrester Research, Mendel and Garbani, March 9, 2007): “IT is help desk decision: now a business tool, and IT applications are directly supporting all business process.” He further notes that IT management software, like help desk and service desk solutions, that bring Costs down costs and increase IT productivity will increase overall • Development Costs (internal or out-sourced) vs. business productivity. Conclusion: help desk solutions demand Purchase Costs - Can you develop a help desk at the same level of comprehensive analysis and planning more lower cost than a purchased solution? typically associated with traditional business purchases. • Internal Maintenance Costs vs Vendors’ Support Evaluating costs (development costs, purchasing and licenses’ Fees - Will you be able to maintain (bug fixes, costs, hosting costs. etc.) for a help desk solution can be enhancements, and tech support) your internal complex. Many organizations employ ROI analysis consultants help desk solution at a lower cost than paying to compare costs of different investment alternatives, mainly maintenance fees to a vendor? because the cost-differential requires a multi-dimensional • Consulting vs. Internal expertise - Have you approach. While cost, as it is used in ROI analysis, is still inventoried your technology expertise and important in making a purchasing decision, there are other calculated costs for purchasing consulting services approaches. in those areas where you lack in-house staff? For example, Forrester Research employs its Total Economic Impact™ (TEI) model rather than straight TCO in its analysis of • Internal Training vs. Vendors’ Classes - Do you software products. By quantifying factors other than cost, the TEI have the resources to provide continued training to model gives managers a more accurate gauge of a product’s new agents for your internally developed help desk ultimate payoffs: project? “Individually, the four components — cost, benefit, flexibility, Benefits and risk — provide only one piece of the decision-support puzzle. Enterprises with specific needs should place different • Automation – Does the in-house solution offer weights on different categories. For example, an increased automated help desk functions and speed up overall cost in a packaged application may be offset by a decrease time to resolution? in risk.