Custom Enterprise Software: Costs, Tips, and What To Keep In Mind

In today's rapidly evolving business landscape, custom enterprise software stands tall, reshaping operations. Discover why businesses worldwide are embracing tailored solutions, ensuring efficient processes and pioneering innovations. Explore the comprehensive guide now.

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Companies around the world rely on enterprise software to streamline their operations. Programs like Microsoft Office and Skype have become so integral to daily workflows that most businesses use them without sparing a second thought.

Today, the same innovation that has given us these useful tools has spawned a massive industry. In 2022 alone, the IT sector spent $783 billion worldwide on research into new enterprise software development.

Why has the enterprise software market turned into the fastest-growing segment in IT?

More businesses than ever are beginning to realize that expensive off-the-shelf software doesn’t necessarily suit their needs. After all, generic software comes with functions that they may never use. To streamline resources, organizations are focusing their attention on custom enterprise software development to streamline resources.

Custom enterprise software refers to a tailor-made or bespoke system that an organization can put in place to streamline its processes. It can benefit various departments and fulfill many functionalities, from finance to customer relationship management, to human resources.

Developing custom enterprise software is, however, not an easy task. A lot of careful planning, design, and programming go into creating a unique, long-term, highly functional solution.

In this comprehensive guide, we examine the various considerations that must be made to design custom enterprise software—including costs, benefits, and examples. It has all the information you need to begin this exciting journey.

What Is Custom Enterprise Software Development?

Custom enterprise software development is the process of creating a unique platform that caters to one organization’s needs. This custom solution reduces reliance on one-size-fits-all solutions, which can be expensive and redundant.

Custom software can be tailored to match any business requirements or integrate with pre-existing tech infrastructure. It can also be scaled to address specific pain points and provide targeted solutions to recurring problems. Enterprises use it to streamline resource planning, customer relations, or supply chain issues.

The process of custom enterprise software development sometimes falls to in-house teams. However, given the complexity of such projects, more and more companies prefer to outsource such development to experienced third-party providers.

Software development teams are tasked with application customization, modernization, and maintenance. These aim to meet ever-changing user and market demands.

Custom enterprise software development will help businesses run more efficiently by empowering them with tools especially designed for their needs.

Why Do Businesses Implement Custom ERP?

One of the primary use cases of custom enterprise software is resource planning. An Enterprise Resource Planning system, or ERP, is a specific type of software that provides an overview of all daily operations across various departments, such as sales, marketing, production, and human resources.

The main goal of an ERP system is to collate data from various operations into a single database. This increases productivity, eliminates data duplication, and provides a much-needed layer of data integrity.

Customized ERP can help with the following:

  • Reduce costs: An ERP system can automate repetitive processes—related to payroll or invoice distribution, for instance—freeing up time for other, more complex tasks.
  • Increase productivity: With a centralized database, employees require less training, as they need to learn on just one platform instead of many different applications.
  • Improve customer service: Lack of communication between various departments can lead to poor customer service. With an ERP system in place, the organization has all the data it needs to put the customer front and center.
  • Access data: Optimized ERP software makes data from every department—from inventory, to merchandise, to shipments—readily available across the board.
  • Improve scalability: With the right ERP software developer, business owners can add new features as operations grow. Regardless of new clientele, markets, divisions, or products, existing features can easily be upgraded and scaled accordingly.

There is no one perfect ERP system for every company, as each one has unique goals and needs.

At the end of the day, whether looking to streamline workflow, comply with regulatory requirements, or improve supply chain management, organizations can greatly benefit from having a specialized system in place.

The Benefits of Custom Enterprise Software

Why would a company need to build its own custom enterprise software? Especially considering there are dozens of off-the-shelf enterprise software solutions with proven track records.

The main difference between custom software and a generic counterpart is that it offers company-specific solutions. It meets only the needs of the business that developed it, while general software is designed for a mass audience.

Customized software includes only necessary functions, while its generic counterparts come with dozens of features meant to cover many bases, most of which will not be used throughout its lifespan.

Let’s look at some of the benefits custom enterprise software can provide in more detail:

An Exclusive Solution

The most significant advantage of a customized software solution is that the company owns the entire system. This means it is in charge of all maintenance and upgrades and won’t have to wait for an application’s publisher to update or improve the software.

Personalization Options

Custom software caters to the specific needs of an organization. It takes all unique challenges into account and is designed to deliver bespoke, exclusive benefits. These solutions will only include features and technologies that the company needs, no more and no less. This differentiates the organization from those who rely on off-the-shelf solutions.

Cost-Effectiveness

While developing custom enterprise software requires a significant initial investment, it doesn’t take long before organizations can see big returns. Mass-produced software, meanwhile, comes with recurring costs and license fees, which will add up over time.

With its targeted functionality, businesses can easily scale features and develop solutions based on what their budget allows. Generic software is much more difficult and expensive to scale—it often involves various hidden costs, often to cover features that may not even be used in the long run.

Higher Security Standards

Another issue with mass-produced open-source software is that they are much easier to hack. Cybercriminals are generally more aware of their vulnerabilities and can circumvent even the most robust security features.

In contrast, custom enterprise software is a closed-source project used only by a select group of internal staff. It is much less vulnerable to malicious third parties hunting systems they can exploit.

This is especially important in high-stakes sectors, such as finance or healthcare, where data protection and security standards are of utmost importance.

More Integration Options

When outsourcing enterprise software development, the team considers all pre-existing technological infrastructure. This helps create a system that integrates seamlessly with current business processes and ensures little to no interruptions for operations. Templated enterprise software, meanwhile, is limited by long-established API.

Smooth integration is crucial because the tools offered by custom systems go on to ensure the smooth functioning and efficacy of existing workflows. Custom software provides real-time visibility into operations allowing for personalized decision-making.

Increased Productivity

Relying on a singular closed-source system means employees don’t have to learn many different processes. When employees spend less time on daily operations and have easy access to all the data they need, they can manage multiple tasks, significantly increasing their productivity.
At the end of the day, all these points lead to higher customer satisfaction. According to a McKinsey study, 71% of consumers say that they expect customers to have personalized interactions. Up to 76% say they are willing to take their business elsewhere when they don’t get access to these bespoke solutions.

Common Types of Enterprise Software

Custom enterprise software is an umbrella term that encompasses many different processes and can impact several departments.

Large organizations that want to boost efficiency, ensure customer satisfaction and retention, and keep track of accounts and finances, may leverage multiple enterprise software options to achieve their goals.

Let’s take a closer look at some of the most common examples of such software:

Enterprise Resource Planning

An ERP system is central to business operations, as it integrates all the core functions of a company into a single platform.

These processes can be included:

  • Procurement
  • Accounting
  • Supply chains
  • Sales and marketing
  • Production
  • Project management

Customer Relationship Management

Typically used by marketing teams, CRM software tracks sales, deals (past and future), and all crucial client information. It is designed to help organizations make sense of large volumes of data and analyze insights about customer behavior.

CRM software also provides businesses with the tools they need to develop new strategies for attracting customers. Apart from its marketing benefits, a fully-integrated CRM can help different departments collaborate and deliver the best possible customer experience.

Human Resource Management

HRM software is designed for employee monitoring and management. It stores and tracks hiring and payroll information to help HR managers to stay on top of employee productivity, train new talent, and manage performance reviews.

Without custom enterprise software, businesses would need a number of individual systems to manage employees, which is a time-consuming and costly process.

Task Management

A robust and specialized task management system can make every manager’s life a lot easier. This type of custom enterprise software centralizes operations across departments, allowing for more effective collaboration and project management capabilities. It can help teams map out the scope of each project and ensure that all deadlines are met.

Supply Chain Management

Businesses rely on a well-oiled supply chain to ensure operations run smoothly. Custom supply chain management software can have several advantages in this regard. It stores information about supplies, manages relationships with suppliers and customers, and keeps stock of inventory.

By taking over such crucial aspects of the supply chain and minimizing human error, SCM software can do wonders for a business’s productivity.

Business Intelligence

Business Intelligence systems compile large sets of data from across a company’s departments, divisions, and subsidiaries into a singular analytics platform. This enables the visualization of data, which can be leveraged to improve decision-making and help the company stand out from the competition.

With a customized and central BI solution, organizations can pinpoint the areas that need improvement and which are excelling.

Knowledge Management

Businesses that rely on highly technical processes can leverage knowledge management software to share information with all employees. By creating a comprehensive knowledge base in one central location, and offering tools like live chat assistance and FAQs, employees can access all needed information with ease.

Centralized knowledge systems also make it easier to provide effective customer solutions. Businesses can also use custom enterprise software tools to automate marketing, create internal learning management systems, manage their finances, and more.

Tips for Success When Looking for Software Solutions

Creating a customized system is a complex and time-consuming process that requires careful planning and deliberation. Organizations can take the following measures to ensure a smooth development process:

  • Outline all goals: It is crucial to define what the business wants to achieve by developing custom enterprise software.
  • Hire the right team: There is no lack of talent capable of creating robust software solutions. The best enterprise software company will have proven expertise and a good track record.
  • Have a well-defined roadmap: This can go a long way in ensuring that the software team will know exactly what to work with.
  • Define the audience: When creating custom software for internal use, consider the needs and expertise of team members.
  • Consider pre-existing tech infrastructure: Enterprise solutions software works best when designed to integrate with existing systems.
  • Estimate costs: Expenses for custom software extend past initial development and deployment. Long-term maintenance and operational costs must be considered as well.

The Cost of Software Development

Creating custom software is not cheap. But it is a worthy investment because the long-term benefits can be immense.

Enterprise software pricing depends on many factors, such as the size of the business, the nature of the software being developed, and the timeline of the project. A startup will require a much lower budget than an international corporation that will deploy enterprise software to thousands of employees.

Prices can range between $20,000 and $5,000,000, with the lower end of the spectrum taking much more time to develop and the higher end offering multiple cross-platform applications.

Some of the significant factors that influence software costs include the following:

  • Product size and scale
  • Complexity of software
  • Design complexity
  • Geographical location
  • UI/UX complexity
  • Infrastructure and connected APIs

The growing importance of custom enterprise software is reflected in its market size. Valued at $24.46 billion in 2021, the industry has a projected compound annual growth rate of 22.3% until 2030.

So what does the future of this industry hold in store? Let’s take a look at the latest trends.

Artificial Intelligence

In the last few years, artificial intelligence has demonstrated the potential to transform almost every industry, from healthcare, to retail and even marketing.

When creating custom enterprise software, AI can be leveraged for an even more personalized user experience. AI technologies can also boost testing accuracy and improve security systems by spotting abnormalities in the system.

Blockchain

Blockchain, currently associated mainly with cryptocurrency, has the potential to add an extra layer of security for technologies across industries.

Blockchain stores all information on a single, decentralized server. This eliminates the middleman, thus reducing operating costs. In 2023 and beyond, nearly all sectors are expected to include blockchain technology in custom enterprise software development.

Cloud Computing

Cloud-driven apps are included in the enterprise software development process for cost reduction, easy data access, and scalability. Along with other trends, cloud computing can help streamline software development and deployment.

Internet of Things

Globally, IoT application development is on the rise. When used with custom software, IoT technologies can optimize operations and provide a seamless user experience. With its ability to integrate data quickly and efficiently, it can enhance safety, monitor infrastructure, and provide a host of other benefits.

What To Consider Before Starting Development

Clearly, creating custom enterprise software can be an overwhelming process. The following steps can help ease the way:

  • Consider the user base: Which team members will be using the software? Which department stands to benefit most? What functions would be most useful to this department? These questions are crucial for a business to answer before the development process begins.
  • Accessibility and permissions: Before contacting a third-party developer, think about accessibility. Does the organization work with remote employees or a hybrid model? Which users should have access to the system? How robust should software permissions be?
  • Processes and functionality: One of the previously-stated benefits of custom software is that it can cater to a business’s highly specific needs. It is important to consider what functions are critical for efficient operations and prioritize them during development.
  • Existing infrastructure: How is business data stored? What systems are being used and must be integrated with the new custom software? The software developer must have all of this information to ensure a smooth process.

Challenges of Custom Software Development

Some of the most common challenges associated with software development include:

Changes in Requirements

Customizing enterprise software is a complex and time-consuming process, and it can be difficult to adjust to frequent changes in business requirements. Accommodating disparate visions of various stakeholders will extend the project timeline.

Security Considerations

While closed-source software is generally more secure than an off-the-shelf option, some security issues must still be ironed out during the development process, including:

  • Data security and privacy
  • Cookie storing data
  • Confidentiality information
  • User permissions

Integration Issues

Enterprise software development requires third-party programs to streamline operations. Ensuring that these applications can be integrated seamlessly into the system can be quite problematic and must undergo a number of design and development modifications.

Lack of Architecture

To build a system that can scale, as well as process, store, and manage large amounts of data, it’s essential to have advanced architecture in place. Most businesses rely on systems that are not optimized for this workload. Organizations must invest in these technologies to ensure a seamless custom enterprise software solution.

Process of Custom Software Development

Custom enterprise software cannot be built in a day or even a week. There are several stages to development, each involving the opinions and expertise of various professionals.

During the process, teams must work with professional developers to get the most out of a custom system.

Here’s an example of what the general process looks like:

  • Step 1: The discovery stage, or establishing what the system must be designed to achieve.
  • Step 2: The planning stage, or inviting ideation from all stakeholders. Employees, managers, and all users on every level of the organization must be consulted to ensure the smooth deployment of the software.
  • Step 3: The design stage, or creating a roadmap to best implement the technology.
  • Step 4: The development stage, or building the actual system with complex coding and software architecture.
  • Step 5: The testing stage, or making sure all processes work as intended. End-users and developers alike must test the features at every stage of the process.
  • Step 6: The maintenance stage, or figuring out ways to scale the solution and ensure smooth deployment in the long term.

Where Can You Hire an Enterprise Software Development Team

Hiring the best software development team will determine how smooth the process will be. In between planning, design, and support and maintenance, there’s a lot at stake—hiring the wrong team can be devastating to a business’s budget and future operations.

The good news is that the right team doesn’t necessarily have to be internal. More organizations than ever are outsourcing their software development needs to highly experienced offshore teams.

How do they find the right partner? A good place to start would be:

  • Freelance platforms, such as LinkedIn, Upwork, and Toptal
  • Search engines, such as Google
  • Word-of-mouth recommendations through a strong network of professionals

Before hiring any team, due diligence is a must. It is crucial to create a list of potential companies and conduct extensive interviews with each of them. The right team to partner with will have relevant expertise and experience with developing and deploying software within the niche. They must also be passionate about their work, have a collaborative spirit, and be reliable and trustworthy throughout the project.

One of the most experienced software development companies, Appstrax, offers all of the above when creating a custom enterprise software solution. Originally from South Africa, the company has an innovative full-stack software development team that caters to clients in Europe, the US, Africa, and Australia.

Appstrax can build an app and help optimize internal processes. Businesses of all sizes and kinds stand to benefit from the services of such a professional and renowned team.

Reasons to Outsource Software Development Services

What can a professional team, such as Appstrax, offer that an in-house team can’t? Here are some factors to consider:

Reduce Costs

An in-house team may offer some benefits, such as ease of communication. But these advantages come with additional costs. In between hiring, onboarding, training, salaries, and benefits, the expenses for an internal software development team will quickly add up.

In contrast, outsourcing software development ensures highly-experienced professionals that will deliver the desired project.

Access a Larger Talent Pool

By outsourcing software development to an offshore team, businesses can access world-class talent regardless of geographic boundaries. An enterprise software company can help enterprises gain a competitive edge over others that are restricted to a limited pool of in-house hires.

Benefit From Experience and Expertise

Internal IT teams may struggle to meet targets and innovate within their areas of competence. Introducing a new challenge into their daily responsibilities—such as creating a custom enterprise software solution—could lead to a sub-par product.

A dedicated software team with years of experience will focus all resources on creating the best possible software solution.

Get It Done Faster

As mentioned earlier, custom enterprise software development takes time. And, as the saying goes, time is money. Developing high-quality internal software within a few weeks can provide organizations with a significant competitive advantage.

Outsourcing software solutions provides access to a dedicated team that works full-time to deliver the best possible product within the deadline.

Conclusion

The main distinction between custom enterprise software and off-the-shelf options is that it offers highly personalized functionalities for businesses. Apart from reducing costs and increasing employee productivity, custom software offers higher security standards and helps companies stand out from the competition.

Any business, regardless of the sector it operates in, can benefit from having such a system in place. Whether it’s for human resources, knowledge management, or supply chain processes, the right software can revolutionize an organization’s operations.

Appstrax has a dedicated and highly talented team that makes use of all the latest technology to create robust software solutions for various industries. Services include mobile app development, blockchain technology, UX/UI design, enterprise solutions, and more. This full-stack development team can turn cutting-edge ideas into reality.

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