It’s no secret we are currently experiencing an economic downturn. With mass tech layoffs and a recession looming, a lot of companies are apprehensively thinking about their next steps.
Recently VentureBeat posed the question every tech leader is asking themselves: is it time to buy or build?
Tech companies can use an economic downturn to make the best decisions to grow their companies, as explained by Kevin Gordon, VP of AI technologies, at AI imaging company NexOptic.
Companies spend 10 times more within the first few years and then begin to save money. With that plan of action, they end up having less control over the functionality of the solution.
“The benefits of ‘buy’ are that you’ll see faster, if not immediate, changes to your stack,” explains Kevin Gordon. “You avoid a design phase. It can be installed and running in five minutes, and there’s already a support team in place. But, the drawback is you don’t own the ‘build,’”
Determining whether to buy or build is tricky. Although buying tends to be the preferred choice when facing an economic downturn, Gordon recommends not to solely make their decisions based on costs.
Instead, it should be made based on ROI objectives. When viewing the project, ask yourself: is this something required to our main business? Does this impact our customer’s needs? If yes, then every decision to build should be directed towards it.
Gordon does present a third option for companies to take advantage of, though. By going open source, companies can use the data and applications by modifying them to best suit their needs and align with their project goals.
“Some come with certain license agreements, but with the right groundwork, your company may just find the perfect tool to modernize your tech stack by leveraging these high-quality solutions at a fraction of the cost,” Gordon says.
Whether companies pursue building or buying (or, with Gordon’s suggestion, going open source), it’s important to always keep your ROI objective in mind. This will help your company to invest in projects and programs with a shorter runway to business results.
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