For financial institutions navigating the complex world of regulatory compliance, the decision to buy or build a compliance solution is pivotal. As a provider of market-leading compliance solutions, b-next advocates for the “buy” option, offering a robust, out-of-the-box solution.
In this guide, we differentiate between several key considerations: cost, time, risk, complexity, and the ability to adapt to new regulations. Let’s explore why buying a compliance solution can be more advantageous compared to building one in-house.
Cost Considerations
| Buying a Compliance Solution |
Building a Compliance Solution |
- Predictable License Costs: When purchasing a compliance solution, clients benefit from predictable and clearly defined license fees. This allows for accurate budgeting and financial planning.
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- Unpredictable Costs: Building a solution in-house involves defining the scope and related costs through extensive workshops and specification phases, which can lead to significant cost uncertainties.
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- Predictable Professional Services Costs: Implementation tasks are pre-defined, leading to predictable and manageable professional services costs.
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- Unpredictable Professional Services Costs: Without pre-defined implementation tasks, the costs for professional services can escalate.
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- Lower Cost of Enhancements: b-next develops new functionalities that benefit all clients, sharing the development costs across multiple users, thus keeping individual client costs lower.
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- High Cost of Enhancements: New functionalities developed in-house require full funding, resulting in higher overall expenses.
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Time Considerations
| Buying a Compliance Solution |
Building a Compliance Solution |
- Short Time to Go-Live: With ready-to-use functionalities, clients can expect a significantly reduced time to deployment.
- Less Testing Time: Continuous vendor-side testing means clients spend less time on testing and more time utilizing the solution.
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- Unpredictable Time to Go-Live: In-house development often encounters numerous unknowns, making it difficult to predict rollout timelines.
- Long Testing Time: Functions must be tested from scratch across multiple cycles, prolonging the development process.
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Risk Considerations
| Buying a Compliance Solution |
Building a Compliance Solution |
- Reduced Risk of Project Failure: By implementing ready-to-use market-proven functionalities, clients minimize the risk of project failure.
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- Higher Risk of Project Failure: Defining all functional requirements from scratch increases the likelihood of overlooking critical elements.
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- Reduced Risk of Resource Unavailability: Buying a solution requires less involvement from internal business and IT resources, reducing the risk of resource bottlenecks.
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- Risk of Resource Unavailability: The involvement of business and IT resources is hard to plan, increasing the risk of delays.
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- Right Setting of Expectations: Clear functional and technical specifications are already available
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- Different Expectations: Misinterpretations and varying terminologies can lead to misaligned expectations.
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Complexity Considerations
| Buying a Compliance Solution |
Building a Compliance Solution |
- Reduced Complexity: Leveraging market-proven functionalities simplifies the implementation process.
- Less Dependencies: Data requirements are known from the start, reducing potential dependency issues.
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- High Complexity: Numerous unknown factors add to the complexity of developing an in-house solution.
- Unknown Dependencies: Undefined requirements and dependencies complicate the development process.
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Adapting to New Regulations
| Buying a Compliance Solution |
Building a Compliance Solution |
- Specialized Vendor Expertise: A specialized vendor continuously develops new functionalities to comply with emerging regulations, ensuring that clients stay compliant.
- Short Response Time: With subject matter experts working on new functions, vendors ensure quick adaptation to regulatory changes.
- Best Practices: Vendors incorporate feedback from a broad user community to build best practice functionalities, providing clients with superior solutions.
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- New Project Teams: Each new regulatory requirement necessitates forming a project team from scratch, slowing down the response time.
- Long Response Time: In-house teams face a steep learning curve before improvements can be effectively implemented.
- Lack of Best Practices: Developments are often based on individual opinions rather than established best practices, potentially leading to suboptimal solutions.
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The decision to buy versus build a compliance solution involves critical analysis of costs, timelines, risks, complexity, and regulatory adaptability. While building an in-house solution offers customization, the predictability, reduced risk, and rapid deployment associated with ready-to-use solutions make buying the more advantageous choice. By choosing to buy from b-next, clients can leverage proven functionalities, ensure compliance with evolving regulations, and optimize resource allocation, ultimately enhancing their operational efficiency and regulatory adherence.
Want to learn more? Contact us here: https://www.b-next.com/contact/