How big your industry is often tells you if you should go off-the-shelf, or in-house.
Across most industries, software has an essential role in how we run our businesses. Management systems are the prevalent solution. But even across common industries, everyone tends to run different businesses in their own way. With the final result tending to be a reflection of the business’s competitive edge, and its quirks.
This is a key decisions that can determine whether your system is an edge or a drawback, so we’ll go through what you should keep in mind when deciding how to choose the management system for your business in your industry.
How digitally niche is your industry?
Off-the-shelf software usually comes about when the core principles of managing a part of your business become a digital standard. The best example of this is sales pipeline software (Nowadays it’s known as a CRM). When deal pipelines became an integral part of every sales team during the rise of the web era, the idea of a digital sales pipeline became almost a necessity. The particular steps of every pipeline are up to leadership and the business, but the core idea of a sale following a pipeline that ultimately ends in “Closed Won” or “Closed Lost”, is reflected across almost every CRM system available today.
This brings us to one of our key points: In bigger industries, you’ll more likely want to go with off-the-shelf software. We’ve worked with plenty of P&C insurance agencies that want to reinvent the wheel and build a custom CRM from the ground up, but usually find themselves wasting development time on recreating features that are already on major platforms.
The fact of the matter is, most systems can accompany most sales pipelines that insurance agencies operate on. Insurance is a massive industry that, although it has a reputation for outdated technology, is actually relatively digitized and has been since the 1990s! This has led to very robust solutions that either stayed in the past or developed as time went on.
The developed systems evolved to not only solve the core problem but remain highly customizable – allowing leadership to tweak it around business operations, without building it from scratch. This is why when we work with insurance agencies, we build their AMS and CRM systems off available solutions like Zoho and Salesforce. Only when an agency has a very particular risk portfolio is it worth building a system from the ground up. This does beg the question, when does the “niche” category apply?
What does niche even mean?
“Niche” is obviously subjective in describing how technologically advanced industries are, but in this article we define it as an industry that has several off-the-shelf options, with either:
A. One or many clear industry-leading solutions that are only accepted due to its name recognition, while also being the subject of frequent complaints and underwhelming reviews.
B. Various solutions that solve some problems that businesses in this industry face, but not an affordable, comprehensive solution.
One industry where we’ve seen these two criteria met is the golf and club industry. In helping one of our partners find a solid golf course management system, we researched the top solutions available in the market, and found them either slightly outdated, unaffordable, and/or bloated.
The companies that sell the comprehensive solution have either outdated UI’s or underdeveloped features in other modules for a higher price; and the companies that offer partial solutions often have to be integrated with other services at an additional cost.
Touching back on one of the main reasons off-the-shelf software comes about: the core principles of running a business in the industry are digitally solved. In golf, this is solved with the online teesheet to book tee times; great! However, in contrast to the major players in the insurance industry, most options are not highly customizable. Leading businesses to adjust around the software rather than the software around it.
What does that mean for us?
For some of our clients, we recommend off-the-shelf options that have customization options and tailor it to their needs; and for other clients, we work hand in hand to build a system that works for their business. Now custom vs off-the-shelf isn’t the be all end all! Next week we’ll discuss a mix of the two: hybrid solutions.