Know the hidden costs behind whether your build or buy.
The cost of building or buying technology
Should you build or buy, and when?
Dave: I imagine that in amongst this audit, in amongst this review of systems, there’s probably not just purchased tech, but maybe built in-house tech as well. Is that fair?
Anne: Oh, gosh. Good question. You know, I guess this is kind of run the build versus buy and I’m a big fan of technology. I don’t think you have to purchase everything. I mean Salesforce is a really powerful platform. You can build a lot there. My teams have built things that we couldn’t find something that existed.
I guess, I’m going to take your question a little bit differently because what I find is most Rev Ops teams are significantly under-resourced right? And you never want to be scaling your Rev Ops team to the point of you’re scaling your go-to-market, like the ratio does matter.
And personally for me, if it’s a heavy build, I don’t know if I’m gonna really build it. And the reason for that is there are so many other things that my team, my systems architect, my devs need to focus on to run the business versus investing them in a product development lifecycle.
I’m like, I have to not just think about well, yeah, it’s free because we’re building it in-house. No, it’s not free. It’s not free because we’re paying that Dev to have let’s call it $250 to $300 an hour, probably grossed up, maybe more. And then in addition to that, if he or she is working on that, what are they not doing to run the business? So there is an opportunity cost related.
Now, again, it depends on the size of the problem. I think if it’s lately, if it’s understood, we just need to build an MVP and a proof of concept to determine if it’s worthwhile to invest that all. I’m happy to do that.
Dave: I like that approach because so many times we see that people think, our dev team can build this and they can, anyone can build anything. As long as you put enough time and effort to effort.
It really becomes a question. Can you sustain that time and effort to get to where you would have been if you had bought it or is it we’ll get to MVP and we’ll get to something later but really that doesn’t usually happen because more priorities come up.
Want to learn more?
Ready to hear more from Anne Pao, including how to sell to your CFO?
You can listen to her in-depth interview in Episode 14 of the Revenue Optimists series. We’ll see you there.