Generally speaking, when a company needs a new system or solution, they usually have to choose between an off-the-shelf solution (COTS) or building something themselves. And there are pros and cons to both. Out-of-the-box will probably offer most of the functionality you need, but if you need anything tweaked, you are totally dependent on the supplier – and this is going to cost you. The beauty of custom-built is that you can build something that’s totally bespoke and you can make any adjustments you want – but you will need the skilled resources within your company to enable you to do this and to maintain it. And in terms of cost, this will be punchy.
Somewhere in between
And it often ends up being a choice between two strategies that are less than ideal. Lots of companies have ended up buying a standard solution but then – under pressure from their business users – made changes to the solution so it suits everyone. But the upshot is that it turns out to be a very costly, one of its kind solution that can’t be maintained or upgraded. So everyone loses out.
The expensive alternative
On the other hand, a lot of companies think they might be able to avoid this by setting up their own IT function and just building a custom solution themselves. But is this the answer? It might seem doable at the start, but as time goes and the solution evolves and changes, it can become problematic. The solution grows to become unmanageable, with an IT function that is too large and uses expensive external contractors. The TCO – total cost of ownership – will be much higher than originally budgeted. At this point, organisations usually default back to standard packages, only to realise that different business functions have built their own custom solutions.
Build and Buy with low code
Keep the core clean
Low-code – or model-driven, as I like to call it – is a positive step in the right direction. It can be a happy medium between the extremes of the COTS and custom-built approaches.
Nowadays, lots of standard off-the-shelf software packages already offer a form of low-code or no-code options within or on top of their platform. With the ethos of keeping the core clean, everything that is not standard can be adapted using low code.
It also possible to completely build and compose your new solution using low code. Using modern low-code application development platforms – like Mendix –everything that would ordinarily be programmed in traditional programming language can be visually modelled using WYSIWYG tooling.
This has the advantage, apart from that it is much faster and easier, that the fundamental technical and IT matters are governed by the platform and that the developer, or business analyst, can focus on the functionality and usability of the solution. This means the boundaries between ‘build vs buy’ are blurring, resulting in hybrid solutions with standard ‘core’ modules supplemented with low-code custom components.
What’s next? Low-code-built adaptable solutions
Low code means it becomes easier – and much less technical – to develop customised, digital solutions yourself. Low-code platforms are bridging the gap between standard off the shelf solutions and custom built. But it still doesn’t offer the full functionality or the on-tap expertise of off-the-shelf solutions – this might be data models, smart algorithms or business processes. But the evolution is coming – companies like Mendix are increasingly focusing on ready-to-use adaptable solutions, from kick-start templates or functional components, to complete vertical industry solutions.
The HumbleBee solution, which is a full low-code solution for the insurance industry, is a good example. Mendix and Valcon have worked together to create an end-to-end solution for digital insurance that consists of different modules and components that Valcon has been developing for different insurance companies over the past decade.
One of HumbleBee’s core components is Dynamic Case Management (DCM) and Business Rule Management (BRM) functionality that Valcon has developed in Mendix. It enables insurers to set up flexible quoting, underwriting and claims processes which they can tailor for different insurance lines. So DCM and BRM are standard in modern BPM platforms nowadays, but not in an out-of-the-box, low-code platform like Mendix. So using Humblebee, insurers get the best of both worlds, the out-of-the-box functionality of an off-the-shelf solution and the flexibility and adaptability of a low-code custom solution. For insurers, this adaptability is essential for them to integrate the solution into their existing IT architecture and gear it towards their own products and services.
Adaptive solutions – next era
Adaptive solutions bring together the benefits of build and buy. Out-of-the-box functionality is available and configurable by the business without them having to have development skills. Any adaptations that are specific to the company’s processes or products can be added or customised easily using the underlying low-code technology.
Do you want to talk about low-code solutions? Please reach out to [email protected]