Choosing buy over build

Software Magazine, Sept, 1998 by Ann Harrison

Executives at Manalapan, N.J.-based MR&S, a $100 million integrator of custom computer products, took a close look at the numbers before selecting off-the-shelf, business-to-business electronic commerce software. "It is the classic build vs. buy tradeoff,' says Bill Santos, vice president of technology services at MR&S. Santos says the company's analysis concluded that they could get anywhere from 80% to 90% of the capabilities they need from a packaged application.

Santos says that companies should look carefully at the business case to support a decision to build homegrown applications. Extras like custom reporting may be appreciated by a small number of users, but Santos says his company found an acceptable replacement for their current system.

"From our perspective, all the major requirements were either in the product or could be integrated into the product and the last ten percent were nice to have, but not must-haves," he says. MR&S is using OrderManager, from SpaceWorks Inc. in Rockville, Md., to create a Web-based ordering system for such top clients as AT&T, Lucent Technologies, and General Motors. The product will connect to the MR&S back-end systems, giving customers the ability to view online catalogs, inventory, pricing, and account status while electronically tracking purchase orders.

According to MR&S President Mark Vicini, the company calculated that building a similar system in-house would have taken nine months and cost three quarters of a million dollars. "OrderManager will allow MR&S to achieve technical efficiencies in the extranet commerce arena within one-third of that timeframe at a significantly lower cost, which would be a tremendous boon to our business," says Vicini.

Santos adds that OrderManager is quickly becoming a new electronic commerce standard in the computer distribution channel. The fact that SpaceWorks already counts integrators such as Merisel and Pomeroy as customers made the product even more attractive to MR&S.

Electronic commerce, Santos says, is creating opportunities for mid-sized integrators like MR&S to develop custom catalogs and standard product configurations that ease the procurement process for big customers, as well as gain a competitive edge. "We believe it will distinguish us from companies our size that we compete with that aren't quite there yet," says Santos.

The MR&S OrderManager system was launched in April via extranet links from the company's existing Dataflo back-end system from San Diego-based DataWorks Inc. Santos says the implementation is moving swiftly. SpaceWorks says if their OrderManager product is not up and running in 60 days, it will provide a year's worth of free support or forgive the license fee, which starts at about $100,000.