Fast growing companies rely on enterprise software to optimize their business operations. It’s no surprise that the enterprise software market is valued at a whopping $396 million USD.
But the problem?
Many of these off-the-shelf enterprise solutions don’t meet the mark. They lack flexibility. They’re often either bloated with dated code or too lightweight to actually meet the practical demands of a growing business.
Because of this, many businesses opt to create custom enterprise software rather than utilize existing software systems.
To help you get started with your own custom enterprise software development project, we’ve included our best 7 tips for success below.
What is custom enterprise software development?
Custom enterprise software development is the process of creating custom software solutions specifically for a business or organization. This can include anything from enterprise resource planning (ERP) systems to customer relationship management (CRM) systems.
The main goal of building custom enterprise software solutions is to help businesses run more efficiently and effectively by delivering tools to meet their specific business needs.
Organizations typically turn to developing custom enterprise software when they are unable to find an off-the-shelf software that suits their internal business demands. In some cases, businesses may opt to customize an existing software to better meet their needs rather than building custom software from scratch.
Developing a custom enterprise application can be a complex and costly undertaking. Businesses must carefully consider their needs and objectives before embarking on a custom software development project. They should also take time to select a reputable and experienced enterprise software development company to support their project.
The benefits of custom enterprise software
While the investment in custom software can be significant, businesses can see a significant long term return on investment (ROI) compared to purchasing pre-packaged software.
Every organization will have a unique business case for custom software. However, a few benefits we’ve seen businesses enjoy with an investment in custom software include:
- Increased workflow efficiencies thanks to software being optimized to meet specific business needs.
- Direct integration with other software tools in an organization’s tech stack, which can help to improve efficiency of business processes and reduce the overhead of maintaining 3rd party integration tools.
- Dedicated support from enterprise software developers who designed and built the application themselves.
- Extensibility and future-proofing against changes to business needs and business growth.
Common types of enterprise software (with real examples)
If you’re considering an investment in enterprise software development, you likely already have in mind what type of software you’re interested in building. However, below you’ll find examples of real custom enterprise software to help you crystalize your own vision.
Enterprise resource planning (ERP)
An ERP system is a software solution that integrates some or all of the core processes and functions of a company, such as supply chain, accounting, inventory management, and sales, onto a single platform. It acts as the “single source of truth” to ensure data integrity across the business.
There are many ERP software solutions on the market such as Oracle NetSuite and SAP Business One. However, because an ERP system is often central to a business's operations, it’s not uncommon for both mid and large-size businesses to turn to custom ERP development to better meet the specific business needs and operational requirements.
Example Custom Solution:
Stratify Solutions, a US-based tech consulting company, needed a contract management lifecycle software solution to streamline contract workflows to manage contracts, like: contract creation, contract renewal, contract negotiation, contract language reviews, and approval process.
Off-the-shelf ERP software solutions are often designed to manage many workflows, not just contract management. So, if the Stratify Solutions had opted to use an off-the-shelf ERP software, they would have ended up with a very bloated tool that would still require significant customization or workarounds to be usable. For these reasons, a custom ERP system was a better fit.
Customer relationships management (CRM)
A CRM system manages a company’s relationships and interactions with all customers and potential customers. CRM systems can help marketing and sales organizations track sales leads and lead interactions, manage customer accounts, and provide customer support.
Salesforce is often seen as the industry standard CRM, but many other lower cost tools are available for growing businesses such as Hubspot, Zoho, and Pipedrive.
Example Custom Solution:
Inviso AS is a Norwegian real estate digital marketing agency delivering services for property brokers. They set out to build a custom suite of tools supporting their collaborations with B2B customers, suppliers and third-parties.
The CRM is used for gathering, placing and managing orders, processing large amounts of visual material, in-house resource and supplier booking and task assignment management, quality assurance, and customer preferences management. This custom CRM was a practical long-term investment for Inviso as it matches their businesses needs perfectly.
Supply chain management (SCM)
An SCM system is a software application that helps organizations manage and control the flow of supply chain work across the enterprise. An SCM can help businesses more effectively manage supply chain operations such as supplier sourcing, production planning, inventory planning, product and supplies transportation, and demand planning.
Common SCM tools include SAP SCM, Oracle SCM, and Logility. While one or more of these products may suit a business's needs, sometimes a custom SCM is needed.
Example Custom Solution:
SourceRooms is an e-sourcing service that supports the execution of tender-based sourcing processes. It was built to help optimize the supplier selection process by providing a way to view and compare all vendor-related artifacts in one location.
Human resources management (HRM)
An HRM system is used to manage employee data and automate HR-related processes. HRM systems typically store data such as employee contact information, job history, and performance reviews. These systems can help HR managers with a variety of things from remaining compliant with tax laws and tracking accrued time-off to automating performance review cycles.
The HRM software category is quite varied. Some HRM tools like PeopleStreme lean more into payroll management. Others like monday.com aid in building out and automating HR processes and workflows.
A custom HRM solution might be the right fit for businesses that don’t want to mix and match various systems to meet the unique needs of their business.
Example Custom Solution:
Humly, a Swedish-born company, has built a custom web application designed to help students find part time jobs and help universities fill temporary job vacancies. This two-way platform helps to manage both school and student data to provide a practical employment solution that meets the needs of both parties.
Customizing an existing HRM system wouldn’t have been a great fit, as the specific industry and application of Studientvikarie’s solution is not typically supported by pre-packaged HRM systems.
Business Intelligence (BI)
A BI system typically consists of a data warehouse (storage), data mining and visualization and a robust reporting and analytics platform. A BI system can help organizations make better decisions, improve operational efficiency, and gain a competitive edge by providing access to data sets from across the organization in one place.
Popular BI systems include Power BI, Tableau, and QuickSight. Typically these solutions will require advanced data engineering skill sets to properly set up and manage along with some level of customization work to ensure proper integration with all necessary data sets.
Alternatively, some organizations choose to build their own custom BI system or dashboards to manage their data and BI analysis needs.
Example Custom Solution:
TD Reply GmbH is a Berlin-based company that designed and built a custom BI system that provides a suite of data-driven services that enable business leaders to understand cause and effects, trace business drivers, and keep track of your competitors moves.
Enterprise custom software development - 7 tips for success
Often developing a fully-custom or even heavily customized enterprise software solution is outside of the capabilities of in-house development teams. It is for this reason that organizations typically seek the help of a dedicated team of expert software developers to create custom software for them.
As you embark on your own development journey, embrace these 7 tips for maximum success.
Define long-term business goals
Developing custom enterprise-level software solutions is time consuming and costly - there’s no doubt about that. It’s an undertaking that should clearly and specifically align to your long-term business goals, not simply solve a short-term problem.
As you begin to outline your business case for custom software, you should identify:
- The long-term goals of the business. Depending on the scope of the potential software project, these goals might be for a specific team (ex. Social Media Marketing Team), an organization (ex. Marketing) or the overall company.
- The specific goals that the enterprise tool would help achieve. Take time to highlight which overall long-term business goals will be met by the help of the software.
- Specific and measurable goals for the custom software. You should carefully weigh these against existing software solutions in the market.
- The timeframe for achieving the goals. The custom software will take time to architect, develop and launch. Consider this timeline as you map it to the timeline of meeting the overall business goals.
Choose a vendor that knows your industry
Anyone that has been through the process of developing a custom solution will tell you that your business partners matter. Take the time to carefully select a development team that is familiar with your industry and understands its nuances.
There are a few specific things we recommend you consider when evaluating software vendors:
- Reputation and track record. Use sites like Clutch to vet potential vendors by reading about past clients’ experiences with them.
- Ability to meet your specific needs. During early conversations with the vendors, ensure their technical competencies, project management skills, and track record prove they are a good fit for your project.
- Pricing. Of course pricing is a critical decision-making point. Take care to read the terms carefully and understand exactly what is and is not included in the vendor’s proposal.
- Customer service and support. Make sure the level of support you require during and after the software development project can be met by the vendor.
Once you have considered all of these factors, you should be able to narrow down your choices and select the best software vendor for your custom software development project.
Plan to optimize business processes
Before undertaking enterprise application development, make sure that it will meaningfully help to optimize internal business processes.
To help you gain clarity on the specific business processes that a new software solution can help to optimize you should:
- Interview users of the current software tools to understand all of your unique business processes that are being handled by these tools. This can help you to understand what real people like and don’t like about the software and how they’re actually using the tools.
- Pull usage reports for existing software tools to understand the processes that are being done in the current tools. This can help you to see not only what needs to be replicated in some ways in the new tool but also where there may be room for optimization.
- Inspect off-the-shelf products before building a custom software solution. Make note of things you like and things that are missing or things that wouldn’t work for your specific business infrastructure.
Embrace proactive change management
Introducing a new enterprise software tool can be challenging. Employees may have years or even decades of experience working with the old tool. Change resistance is natural.
A company should embrace proactive change management for new software tools by:
- Involving key users in the decision making process. Asking for input from real users, not just management levels will not only help to ensure you’re building the right tool, but also start to establish buy-in very early.
- Defining the purpose and expected outcomes of the new enterprise software tool. This will help to ensure that the tools are properly utilized and that employees are aware of the changes that they will need to make in order to use the new tools effectively.
- Communicating the changes to all employees. This communication should include an explanation of the new tools, how they will be used, and what employees need to do in order to use them effectively.
- Training employees on how to use the new tools. After employees have been made aware of the changes, you need to roll out comprehensive training on how they should use it.
Build in software flexibility
One of the key value-adds of custom software is its flexibility and extensibility as business needs change. Building in software flexibility is important for enterprise software for 3 major reasons:
- To ensure the solution can be easily modified over time. This will allow for adaptability as the business grows, new products are developed, and as broader market and technology changes roll out.
- To reduce the overall cost of ownership. By avoiding the need for costly and time-consuming rewrites or replacements, overall cost of ownership will be lower.
- To improve the overall quality of the software. High-quality development teams will embrace modern development methodologies that prioritize delivering flexible, easy-to-understand software.
There are a number of ways to build in software flexibility such as through modular design or by using industry-standard software frameworks. An experienced development team will help make the right technical decisions that align with your long-term business goals.
Be prepared to iterate
Most software projects will require some level of iteration in order to achieve the desired outcome.
Iteration is important because it allows teams to quickly test and implement changes, which can help to improve the final product.
There are a few things that teams should keep in mind when preparing to iterate during a software project:
- Define what success looks like. Before starting a software project, it's important to have the project manager define what success looks like. This will help to keep the development team on track and avoid time spent implementing changes that don't actually improve the product.
- Make sure you have adequate communication channels established. Even if the development process is being outsourced, you should still be made aware of when and how the iterations will affect the end product.
- Be patient and trust the process. Understand that as your team and the development team learn more about what they are building, things may change. They may come up with better ways of doing things. That’s actually a value they provide! So, don’t be too scared if things change over time - it’s perfectly natural.
Don’t overlook testing
A thorough testing plan is a must for any enterprise software development project. Your development team should help to advise what types of testing will be necessary for your particular software development project.
A few things to consider when you’re conducting testing:
- All operational processes should be tested systematically. Bring in real users if needed to ensure all operations that are essential to the business are functional.
- All integrations should be thoroughly tested. Make sure the system is working with other systems or software used within your organization as you expect.
- The application should be tested on both desktop and mobile devices. Additionally, if the development included any mobile apps, those should be tested as well.
- The final software features should match what was defined in the requirements list. Things may have changed over the course of development, but the testing team should be checking the final software against the requirements list.
As you wrap up testing and move into a software hand-off phase, make sure all the relevant information is included in the technical documentation that the development team provides. This will help protect you in case you need to implement changes with developers outside of your original development team.
The cost of enterprise software development
The cost of custom enterprise software development can vary greatly depending on the size and complexity of the project. For example, a small project to customize an existing solution might only cost a few thousand dollars, while a large project to build a BI or ERP system from the ground up could cost millions.
In general, the up-front cost of enterprise software development is higher than simply subscribing to a cloud-based off-the-shelf software, but it can be worth it if the software is a perfect fit for your business.
There are a number of ways to help keep costs down when developing a custom enterprise tool:
- Make sure you’re really clear on your requirements and scope of work before you start development. There’s nothing more likely to wreak havoc on your budget than a requirements list that grows during the course of development. Take the time up front to properly scope out the work required and vet out the requirements list with all stakeholders.
- Use a tool such as Odoo or Amazon Quicksight. Platforms like Odoo and Quicksight are revolutionizing the enterprise software market by providing modern, cloud-based, modular solutions at a relatively low cost. These tools are potentially a great in-between option for small or mid-sized businesses who may not find a traditional enterprise solution fitting their needs but also might not have the budget for a fully custom solution.
- Outsource to Eastern Europe. Software development costs can be upwards of 70% cheaper in Eastern Europe compared to the United States, while still providing the same level of technical expertise and business acumen.
Conclusion
Developing custom enterprise software is a significant undertaking for any business. While the results may be alluring, the costs and sheer magnitude of such a project can be daunting. To maximize your project’s success, make use of the top 7 tips we shared in this article:
- Define long-term business goals.
- Choose a vendor that knows your industry.
- Plan to optimize business processes.
- Embrace proactive change management.
- Build in software flexibility.
- Be prepared to iterate.
- Don’t overlook testing.
With a clear focus and an experienced enterprise software development team, you’ll be off to a great start developing your own custom software solutions!