Why Enterprises Choose Custom Software Over SaaS

The rapid evolution of technology has made it increasingly dependent upon the implementation of software programs to help manage day-to-day operations and improve customer satisfaction while gaining a competitive advantage in today’s marketplace. The main reason for this shift from SaaS type offerings to custom developed software by larger enterprise businesses is the fact that SaaS type products are restricted to a certain point and eventually become outdated.

The purpose of this article is to discuss the reasons why enterprises choose to develop custom software as opposed to using standard pre-packaged SaaS software solutions and how developing customized software will provide long-term business value.

1. Specifically Designed for Your Business Needs

SaaS (Software as a Service) solutions are available to many companies simultaneously. Many companies have the same type needs, thus SaaS companies can design products to fulfill that need across multiple companies. Since businesses are not all the same, have unique business processes, and have different volume of transactions per day/week, etc., they require custom software.

Custom software will align with:

• Workflow Processes (how things get done internally)
• Industry Regulations
• Organizational Structure (how the company is structured, i.e., CEO, COO, etc.)
• Proprietary Business Logic and Automation Needs (the processes that dictate business operations)

By creating custom software that works with the company’s workflow, businesses will see increased efficiency due to fewer workarounds, increased productivity, etc.

2. Limitless Growth Potential with Scalability.

The common constraining elements of SaaS Tools include:

• User Limitations
• Limited Features
• API Limitation
• Pricing Tiers that increase exponentially.

As a company grows, these limitations become increasingly costly, and will become a hindrance to the company’s growth.

Custom-form developed software has been designed for future growth as follows:

• Unlimited growth potential
• Modular architecture for future growth
• Performance Optimized for the future
• Available to deploy on cloud, hybrid or on-premise architectures

A custom developed solution grows with the company’s growth, as opposed to against it.

The final result is a long-term growth oriented software that has no surprises for costs or barriers to growth through technology.

3. Greater Control Over Security and Compliance

Security is one of the biggest reasons enterprises move away from generic SaaS platforms.

With SaaS, companies depend on third-party security policies, infrastructure decisions, and compliance standards. For industries like healthcare, finance, manufacturing, and government, this often isn’t enough.

Custom software provides:

• Full control over data storage
• Advanced encryption methods
• Custom authentication systems
• Industry-specific compliance (HIPAA, GDPR, SOC 2, ISO, etc.)
• Internal access control and audit trails

Result: Stronger data protection, reduced risk, and easier regulatory compliance.

4. Easy Links to Important Systems

Most companies do not just use one kind of software. Rather, these major corporations use an assortment of different software packages to run their business each and every day.

• ERP
• CRM
• Accounting
• Supply Chain Management Systems
• Old Technologies (usually PC-based)
• Data Warehouse Technologies

Most Software as a Service products have limited connectivity, or need to be connected via middleware that usually costs quite a bit. However, custom software has been built to work directly with a large organization’s already existing software and hardware. Therefore it can provide:

• Instant Data Sharing
• Single Dashboards
• Automated Workflows
• Less Duplicate Data

Result: All of a company’s software and hardware systems are connected as one complete system rather than remaining as stand-alone systems.

5. Long-Term Cost Efficiency

While SaaS seems to be cheaper initially, the long-term costs of using SaaS can increase because:

• Per-User Pricing
• Price Tiered by Features
• Customization Fees
• Integration Costs
• Data Overage Fees

Customer Developed Software requires an initial investment but provides several advantages for the enterprise including:

• No Recurring License Fee(s)
• The Business owns its own platform
• Ability to Enhance Features Without Fear of Vendor Lock In.
• Reduced Dependency on Multiple Tools.

Over a period, Custom Development usually Provide Greater Value and Higher Capability than Supporting Multiple SaaS Subscriptions.

Which provides better ROI with predictable long-term costs.

6. Competitive Advantage Through Innovation

Through innovation, a business can achieve a competitive advantage. For example: while SaaS platforms provide the same features to each customer (including those of their competitors), custom software allows businesses to do many things:

• Design their own proprietary workflow.
• Create a unique digital product
• Automate process in the Niche area
• Integrate AI and analytics based on their company’s data
• Adapt quickly to the marketplace.

As a result, custom software creates a Technology-based difference over competitors, not merely operational support.

Custom Software then becomes an asset to the business and not just a utility.

7. Ownership of Full Software and Vendor Independence

With SaaS (Software as a Service), a business is subject to any of the following from their Vendors:

• Vendor Pricing Changes
• Vendor Discontinuation of the Product
• Vendor Forced Updates
• Vendor Removal of Features
• Vendor Limitations of the Platform

When utilizing custom software, a business owns:

• All of the Intellectual Property Rights associated with the software
• Complete Control over the Update Schedule of the Software
• Complete Authority over the Software Roadmap
• Avoidance of Vendor Forced Migrations of the Software
• Complete Freedom in Hosting the Custom Software on Any Platform

As a Result: Strategic Independence and Long-Term Stability.

8. Performance and Reliability

SaaS is a shared platform many companies share a SaaS platform. As such, the Performance of a SaaS Business may fluctuate based on the load the systems are experiencing and the prioritization of the infrastructure that runs the SaaS platform.

Custom Enterprise Software is engineered to handle:

• High Volumes of Transactions
• Very Large Amounts of Data Processed
• Specific Workloads Pertaining to Certain Industries
• Optimized Response Time(s)
• Business Critical Uptime

As a Result: Higher Speed, Greater Reliability and Improved User Experience.

Conclusion

For Start-ups and Smaller Teams, SaaS is still an excellent option because of its ability to be implemented quickly. However, as a business continues to grow, they require much more flexibility, control, integration and strategic value than what SaaS can provide.

Custom Software will allow a Business to:

• Foundation of their Business Operating Model
• Enhance their Security and Compliance Position
• Innovate Ahead of Competitors
• Scale Their Business to New Heights
• Control Their Digital Future.

For a Business that is Focused on Long-Term Growth and Digital Transformation, investing in Custom Software is not an expense; it is a Competitive Investment opportunity.
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