Build vs. Buy – getting ahead

Technology Entrepreneurship Class

GIMPAMarch 2007

Technology business and the competitive edge

• Things you do which make you unique in the market place , allow your customers to keep coming back and makes it difficult for your competitors to copy you

Build or Buy is about the competitive edge

• What keeps you ahead of the pack ?

• Isolating the business from its supporting services?

• Identifying your competencies

What type of technology business are you ?

• High-Tech innovator creating new markets opportunities ( Rancard)

• Medium technology player providing support to existing industry (Standard Trust)

• Low tech mass market technology company( Areeba)

What type of market are you getting into?

• Mature market with dominant players• Mature market with new opportunities and

applications for technology• New market with few established players

Critical factors for business continuity ?

• Innovation• Market share• Distribution /channels / product

availability• Cost of shift• Products vs. platforms – WEB 2.0

Build when ?

• Building creates new opportunities for the business or strengthens a market position.

• Cost of building is not disruptive to market position.

• Building is necessary for survival.

Buy when ?

• It makes no sense to build.

• You don’t have the time to build.

• You don’t have the competency to build.

• Product area is not important to core of business.

Open source – the middle ground

• Leverage of best of breed.

• Deliver software as service.

• Provide customizations which enhance business value.

Build vs. Buy

Q & A