Should we build this or buy it?

Questions CTOs ask

How do you decide whether to build or buy software?

The build vs. buy decision hinges on four factors: strategic differentiation (does this capability provide competitive advantage), total cost of ownership (build costs including ongoing maintenance vs. vendor fees over 3-5 years), time-to-market (can you afford the development timeline), and organizational capability (do you have the expertise to build and maintain it). Build when the capability is core to your competitive advantage; buy when it is commoditized and well-served by existing vendors.

What is the total cost of ownership for build vs buy?

TCO for building includes initial development (engineering salaries, opportunity cost), ongoing maintenance (typically 15-20% of build cost annually), infrastructure, security patching, and feature development. TCO for buying includes license fees, integration costs, customization, training, and vendor lock-in risk. Build TCO is routinely underestimated because maintenance, on-call burden, documentation and the cost of keeping the solution current over its whole lifespan are left out of the comparison — and those costs land every year, while the build cost lands once.