A make or buy guide for corporate real estate professionals seeking out digital transformation opportunities.
As the real estate industry opens its eyes to the benefits of digital transformation, many organizations are looking to new technology solutions that can lighten the load of low-ROI activities like data wrangling and manual reporting.
Exploring new systems can be tricky, especially when you’re likely already jumping between various software platforms (Lease Admin, HRIS, and IWMS to name a few). How will you implement yet another software that doesn’t compete with your existing tech stack and provides speed to value?
Some organizations are choosing to build their own portfolio optimization solutions in-house, while others are outsourcing. Which option makes sense for your team? Keep reading and take our 2-minute quiz to help you weigh the pros and cons of this make or buy decision.
The most obvious consideration when implementing a new software solution is cost. Buying is more predictable, while you might end up with some unexpected costs if you build your own. Think of it like renting an apartment versus buying a house. When a pipe bursts, are you calling maintenance to take care of it for free, or are you hiring the plumber on your own dime?
What are the service provider’s monthly subscription costs?
Are there any discounts for up-front or annual payment?
Does the vendor charge any implementation or onboarding fees?
Are there any additional fees for features or customization that we need?
What’s the production cost in terms of salary for your team to spend their time on this project?
Will you need to hire any contractors to assist in building a custom software? How much will you pay them?
What’s the fixed cost? In other words – what building blocks do you need to put together the infrastructure for this solution?
What’s the opportunity cost of spending your time and resources on this project?
Once you get your own data in the system, how much will it cost to bring in real-time market data?
Speed to Solution
How long will it take for your team to gain value from this solution when you’re buying? What about building your own? In your decision making process, consider your team’s timeline and any associated goals that can be achieved through the implementation of this solution.
Are there any potential bottlenecks that could arise as you try to build a business case for this new spend?
How long will the onboard process take?
Is there any heavy lifting required on your end to onboard?
How long will it take for you to derive value from this solution?
How long will it take your team to perform preliminary research?
Will it be a lengthy process to get this project approved?
How long will it take to build the tool?
How much time will you set aside for testing before it goes live?
How long will it take for you to derive value from the solution?
Who has the competitive advantage here? Do you need someone who knows your organization inside and out to build this solution, or do you need someone who knows this solution inside and out to get to know your organization?
How much do you value the expertise associated with an outside supplier?
Will a purchased solution and associated support ensure and advise on best practices for use and optimization?
What are your team’s strengths and experience levels with this endeavor?
Does anyone on your team specialize in real estate data and analytics?
Does anyone on your team have proven experience building this type of solution?
Are you confident that your team has enough subject matter expertise to provide a quality, dependable product?
Is your team’s time best spent on this project?
Are we able to enrich our own data with the market data and other external data we need to make informed decisions?
Once you implement your new software, what will it take to keep things up and running? Again, this is much more predictable when buying. In this case, you’ll likely be provided some kind of timeline and clear expectations for the duration of the working relationship. Should you choose to build a custom solution, someone on your team will have to commit to ongoing maintenance.
Who will be your point(s) of contact with the provider?
How much time will your team spend communicating and solutioning with your provider?
How much time (if any) will be required of you to input data in the system on a continuing basis?
How much money and time will you have to spend on maintenance and upkeep of your own software?
Will you need a person or team dedicated to maintaining this solution?
Is the person on your team in charge of software maintenance a subject matter expert? Do they have experience maintaining and troubleshooting with a similar platform?
How much time will it take for your team to clean and validate your data before it enters the system?
Will this solution age well?
Will you have to perform major updates over the years to keep the tool viable?
Who will be fighting fires when problems arise?
Tech and Compatibility
How compatible will this solution be with your existing tech stack? Could the data and analytics you’re inputting here come directly from another system, or does it have to be translated first?
Does this third party software have APIs that allow for seamless integrations?
Is this tool compatible with the software solutions that are already in use?
Is access and visibility into code a factor in your decision?
Would your team be able to build a platform that’s compatible with your existing solutions?
Can your team build a platform that could consolidate existing solutions?
Determine whether this is something you want to show off or if it’s purely functional. Keep your end-user in mind when weighing the importance of design.
Is your outsourcing option user-friendly and easy to navigate?
Is this software something we would show to a prospect or client?
Is anyone on your “build” team familiar with UX/UI design?
Are we okay with a solution that prioritizes function over form?
Will our end-users be able to confidently navigate this solution?
What are your “have-to-have” features as opposed to your “nice-to-have” features? Who is best equipped to provide those “have-to-haves” for you?
Does the product offering we’re exploring have our “must-have” features?
Is this solution “out of the box” or is there room to customize it to fit our needs?
What are the benefits for us associated with the features offered?
Can you develop a solution that offers all of our must-have features and functionalities?
How much will you miss those “nice-to-have” features that you might have gotten from a purchased solution?
Now that you’ve considered each major component of this decision, it’s time to dive deeper in your analysis. Take our 2-minute quiz to get our recommendation for whether you should build or buy based on the factors listed above.
Posted on: March 25, 2021
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