Buy vs build: The pendulum swings



special report So, your back-end systems are showing signs of age? Put down the chequebook; David Braue finds that when it comes to building business apps, many companies are putting themselves back in the driver's seat.


Contents
The pendulum returns
...and in this corner...
The vendors' response, and yours
The resurgence of "build"
Sidebar: Finding a healthy balance
Sidebar: Get vertical
Executive summary

By June -- if everything goes according to plan -- more than 10,000 Commonwealth Bank of Australia (CBA) employees will be running CommSee, the customer relationship management (CRM) system that is the linchpin of a AU$100 million systems transformation to revolutionise the bank's customer-facing operations.

Developed over several years and piloted last year at 43 Tasmanian branches serving 250,000 customers, the new system will be the culmination of hundreds of thousands of man-hours' work. Ultimately, the .NET-based system will have around 21,000 users in over 1000 locations, a scale made even more remarkable by the fact that CBA built the entire system itself from the ground up.

For such a major investment, and such a critical information system, the genesis of CommSee is a considerable break with tradition. In-house development used to be the only way for a company to get the applications it needed, but with a diversifying and maturing software market offering many rich off-the-shelf CRM systems, few companies can still muster the determination to build such a major system themselves.

There are other reasons for the flight from in-house development: particularly since Y2K remediation made the world collectively realise the potential consequences of poor development, risk-averse large organisations have shifted towards buying major systems from established vendors -- if only so CIOs might have someone else to drag into the swamp if things went pear-shaped.

Clearly, the CBA believes its team of more than 150 developers is up to the task of development, which has derailed both smaller and larger efforts in the past. And with the system having scaled past 30,000 users during stress testing last year, it's possible that the potentially career-ending decision by CEO David Murray could actually pay off as expected rather than going down in flames like so many projects before it.

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