Roll Your Own Future

Maryfran Johnson   Today’s Top Stories    or  Other Software Stories  

Why SaaS is Vital to Email and Web Security Reduce Cost and Increase Efficiency with Grid Computing Oracle Database 11g Internet Seminar Web Security SaaS: The Next Generation of Web Security Delivering on the Promise of ELearning Rapid E-Learning: Maturing Technology Brings Balance and Possibilities Sign up to receive Security Resource Alerts

August 09, 2004 (Computerworld) -- Now here's a real classic on the comeback trail: developing your own applications. Sounds so retro, doesn't it? The kind of thing start-ups do when the CEO doubles as the chief product engineer and surrounds himself with a cabal of MIT grads writing code. So what's going on when large pharmaceutical companies, insurers, hotel chains, health care providers and online powerhouses like travel firm Orbitz are found, in this day and age, productively rolling their own?
Computerworld reporter Gary H. Anthes answered that question last week in his cover story about the many sensible, cost-saving and even surprising reasons why companies build their own applications rather than buying into more packaged software ["Roll Your Own," QuickLink 47884]. What he uncovered flies in the face of conventional wisdom that buying is better than building -- a belief assiduously promoted by software vendors of all sizes.
And no wonder. The lifeblood of so many software companies increasingly flows directly from their maintenance and support fees, which have risen to nosebleed levels of 18% to 25% annually to offset the economic drag of lower sales in recent years.
Take Oracle as Exhibit A. When the database maker posted its financial results in mid-June, the single biggest factor cited as offsetting its slow-moving application sales was rapidly growing revenue from those fat fees for software maintenance. That revenue is increasing nearly twice as fast as new license revenue, CEO Larry Ellison said.
But it's not just the high cost of applications and their hefty annual fees that are driving development of homegrown applications. Ranking high as reasons for this approach are dissatisfaction with complacent vendors that don't respond quickly enough to user needs, and dismay over software suites overloaded with features and fiendish complexity. At Reinsurance Group of America, for example, a $35 million global enterprise administration system that was developed in-house not only fueled a competitive leap past the company's rivals but also was vastly preferable to the nightmare alternative of integrating more than a half-dozen commercial packages to provide similar capabilities.
Yet the greatest reason of all to roll your own is the ability to tailor IT to your business, to control the fate of applications too vital to trust to outside developers. It's about enabling (may Nicholas Carr forgive us here) a competitive edge that really does matter.
At Reliant Pharmaceuticals, for example, CIO Ron Calderone wisely heeded user resistance to complicated sales force automation tools and built a relatively simple system using speech recognition technology for the field agents. A packaged SFA system would have cost $4 million to $6 million, Calderone reckoned, but he delivered just what his business comrades needed for about 15% of that.
"Simple and inexpensive" are often the magic words associated with the best in-house application projects. We're hearing that mantra more often these days, particularly as open-source software carves inroads at the enterprise level. As Orbitz CTO Chris Hjelm put it in our story, "We are largely an open-source shop, so when we think about buying software, there's a general aversion to it."
The "buy vs. build" debate will no doubt go on forever. But the combination of open-source software with sophisticated development tools and standardized Web services is dramatically changing the face of that argument. When companies go looking for technical creativity, innovation and a competitive edge, they won't be buying that off anybody's shelf but their own.
Maryfran Johnson is editor in chief of Computerworld. You can contact her at maryfran_johnson@computerworld.com.

Print this Story

Send Us Feedback

E-mail this Story

Digg this Story

Slashdot this Story

"Apple yesterday dropped the price of the 64Gb MacBook Air by a whopping $500 ($400 less for the SSD and..." Read more... "It's a cheaper IT Blogwatch: in which Apple cuts the price of the top-end MacBook Air. Not to mention dan..." Read more... Read more Software posts or See all Blogs

Microsoft promises four patches next week Google gives away home-cooked Web application security scanner Expect iPhone, Fourth of July scams, security firm says More top stories...

Microsoft trumpets security additions in upcoming IE8 Apple cuts price of high-end SSD MacBook Air by $500 Ultrathin showdown: Apple MacBook Air vs. Lenovo ThinkPad X300 vs. Toshiba Portege R500

This old laptop: Revitalizing an aging notebook on the cheap All it takes is a couple hours and about $125 to breathe new life into an old laptop. Here's how. Bill Gates moves on Is Microsoft's Golden Age over? What are Gates' most memorable quotes? Find out in Computerworld's complete coverage of the end of the Bill Gates era at Microsoft. Five things you should never tell your boss There are some things your CIO definitely doesn't want to hear. Also don't miss the flipside, Five things you should always tell your boss. Hands-On: Firefox 3 fixes what's broke and keeps what's right With its latest version, Mozilla's browser continues to raise the bar for what Web browsers should be. Windows Vista A to Z Reviews, analyses, how-tos, visual tours, hot issues and predictions about Microsoft's new OS. More Continuing Coverage After 9/11: Homeland SecurityAsk a Premier 100 IT LeaderBlackBerry Legal BattleData Security BreachesElectronic VotingFirefoxH-1B VisasHP's Boardroom ScandalHandheld DevicesHurricane Katrina AftermathMicrosoft Legal IssuesMicrosoft's VistaOpen SourceRFID TechnologySCO's Linux FightSarbanes-Oxley ActSpamVoice Over IPWi-FiWindows Meta File VulnerabilityWindows XP Service Pack 3 IT Careers 2010 Four years from now, the IT field will be a vastly different place. Will you be ready? More Special Reports Premier 100 IT Leaders 2007 Best in Class2006 Computerworld Horizon Awards2006 Premier 100 IT Leaders2006 Salary Survey2007 Best Places to Work in IT2007 IT Forecast2007 Premier 100 IT Leaders40 Years of ComputerworldASPs, Take TwoBest Places to Work in IT 2003Best Places to Work in IT 2004Best Places to Work in IT 2005Best Places to Work in IT 2006Business Intelligence Home RunsBusiness Intelligence: Smarter BIBusiness Intelligence: The Future of BICRM Goes VerticalCRM: Sober CRMCareer Planning Guide 2005Careers: IT Profession 2010Computerworld Horizon Awards 2005Data Management: Mining for GemsData Management: Taming Data ChaosDevelopment: Hard-Workin' Web SitesDevelopment: New Tools New ChoicesDevelopment: The New World of Application DevelopmentDevelopment: The Web Services TsunamiDevelopment: Web Services HurdlesDisaster Recovery: Preparing for the WorstE-commerce Grows UpE-mail/Groupware: Big DecisionsFaces of Mobile ITForecast 2006Global MobileHardware: Multiple Cores, Multiple ChallengesHardware: On-Demand Un-HypedHardware: The Shape of Things to ComeHorizon Awards: 10 Cool Cutting Edge TechnologiesIT Management: Guide to Managing VendorsIT Management: Navigating Global ITIT Management: Recovery AheadIT Management: The Future of ITIT Management: The Resourceful Project ManagerInnovative Technology Awards 2004Management: Reinventing ITMicrosoft in TransitionMobile/Wireless Leaders and LaggardsMobile/Wireless: The Untethered WorkerMobile/Wireless: Tiny Gadgets, Huge CostsNetwork Management: Taking ControlNetworking: Turbulence Ahead!Networking: VoIP Goes MainstreamOperating Systems: In the Slow LaneOperating Systems: Linux Goes GlobalOperating Systems: Should You Nix Unix?Outsourcing: Offshore Buyer's GuideOutsourcing: Outsourcing DangersPremier 100 IT Leaders 2004 Best in ClassPremier 100 IT Leaders 2005 Best in ClassROI: Do the Math!Salary Survey 2003Salary Survey 2004Salary Survey 2005Security Action PlanSecurity: Compliance HeadachesSecurity: Proactive SecuritySecurity: Risk and RewardSecurity: Tips From Security ProsSouped-up SecurityStorage: Battling ComplexityStorage: Cheap & Secure Data StoresStorage: Stretching Your Storage DollarsStorage: The Lean Storage MachineStorage: The New Rules of StorageStorage: The Ultimate Backup GuideSupply Chain: Missing LinksSupply Chain: RFID Reality CheckThe Business of SecurityWeb 2.0 SecurityWireless: Wireless At Work All Zones Application Performance Zone Business Continuity Zone Data Center Management Zone Enterprise-Class Security Zone The File Data Management Zone Grid Computing on Windows Zone Security Management Zone ITIL Best Practices Zone The SAS Zone Storage Virtualization Zone Business Intelligence and Analytics Zone See your link here

Computerworld Technology Briefing: An open-source path to optimal virtualization Download this Technology Briefing now! (Source: Novell/IBM/Intel) Virtualization is about a lot more than just lowering total cost of ownership. In fact users that have taken an open source path to virtualization have realized the additional, mission-critical benefit of markedly reduced IT complexity, as well as a more flexible infrastructure that is easier to change to meet shifting, often unpredictable business requirements. Download this executive briefing  Advance your BlackBerry(R) solution management know-how this July Advance your BlackBerry(R) solution management know-how this July BlackBerry Technical Seminar, register today! Go to the webcast  Rapid application development, rapid results Download this special report now! (Source: Intersystems) All too many businesses suffer from IT infrastructures that are a hodge-podge of disconnected databases and applications. What's needed is the ability rapidly develop connected applications under a unified service-oriented architecture. InterSystems Ensemble integration environment and Cache database are effective tools in answering this need, delivering a rapid ROI. Download this white paper  White Papers Read up on the latest ideas and technologies from companies that sell hardware, software and services. Deploying Virtualized NetWare on Linux Whitepaper Toward More Flexible, Next-Generation Collaboration Solutions Driving Business Success Through Workgroup Choice and Flexibility View more whitepapers

• Microsoft promises four patches next week
• Google gives away home-cooked Web application security scanner
• Expect iPhone, Fourth of July scams, security firm says
• More top stories 

Computerworld Technology Briefing: Meetings @ the Speed of Business For large organizations, Web conferencing gives a major boost to collaboration among far-flung offices. For smaller companies, experts say Web conferencing is no longer a luxury but a necessity for everything from webinars to customer presentations. But the real value lies in saving soft costs and in increases in productivity. Download this briefing

Creating Tiered Storage Architecture This paper shows how Brocade StorageX enables tiers of storage across Windows and NetApp storage to align storage practices with organizational objectives. Download this white paper now!

Best Places to Work in IT Where can you earn top dollar, get the best benefits, the latest IT and more? Find out in our 14th annual survey.