Wednesday, May 4, 2011

Eenie meenie miney mo - Packaged Apps Vs. Custom Apps

Today's question on the ebizQ Tech forum was about which one is better - packaged apps or custom developed ones? The question was inspired by Mike Gilpin's Forrester blog, Packaged Versus Custom Apps: The Debate Rages On, where he writes that it wasn't that long ago that packaged apps ruled the application delivery landscape and custom development was decidedly the second choice. He contends, however, that today, the decision is not so cut and dried, as firms struggle to find the right balance between the quick time-to-market of packages and the competitive distinction custom development can create.

The simple answer is neither is better. An enterprise needs both. The question is akin to asking "what's better - peanut butter or jelly?" How often have we heard of just a peanut butter or just a jelly sandwich. Definitely not as much as we hear about a "peanut butter and jelly" or "PBJ" sandwich. Similarly, it would be rare to find an organization that did not have both custom and packaged applications weaved together.

Make no mistake however that this by no means implies that both custom and packaged apps are the same. There are different reasons why a situation might warrant one over the other. For example, a core strategic business process most often requires a custom application in order to create and maintain maximum competitive advantage. Packaged apps typcially standardize "best practices". Since packaged apps can be bought and used by anyone, they (and therefore standardized best practices) rarely yield a true competitive advantage. But if a business process (such as billing your customers) is routine (i.e. is not the source of your competitive advantage) then by all means leveraging a packaged app and customizing it makes perfect sense.

The moral of the above is that one thing is rarely better than another in the absolute sense. It's the situation that might make one solution more appealing than the other.

* Originally posted in ebizQ's Tech forum on May 4, 2011.