Build Vs. Buy III - Steps to Analysis

One of the main reasons why you are doing this analysis is to map the business and/or technical requirements against the product(s) that you are trying to evaluate. The evaluation should be objective, but that is not always possible in every organization. As I have stated previously a good way of handling this is to use 3rd party analysis and compare the products based upon the functionality needed.

Here are the steps that are typically taken during the process of doing a Build Versus Buy analysis:

1. Do a detailed functional requirements analysis of the needs associated with the product. These are the business drivers for using this product. Make sure that these requirements can be related back directly to a group/individual that is responsible for the outlay of budget for the outcome of the decision.
2. Do a detailed non-functional requirements analysis of the needs associated with the product. These are sometimes called system requirements or technical requirements. These will need to incorporate issues such as technical infrastructure, support, and personnel.
3. Create a set of criteria in a spreadsheet that specifies the criteria for each of the vendors that you will be evaluating.
4. Create a set of weights that will be used for each criteria.
5. Have the weights and criteria approved by management and if possible publish internally within the organization so that everyone involved will feel empowered by understanding the criteria by which the evaluation will be performed.
6. Work with each Vendor to get the questions answered.
7. If questions can't be answered directly by Vendors, you may need to evaluate the product directly to get the questions answered.
8. As the person administering the build vs. buy exercise you should rate the product(s) and compute a score.
9. Deliver the answered questions (without your rating) to any other individuals who will have to rate the product.
10. Collate the ratings and deliver:

• A spreadsheet with all of the questions, weights, and ratings.
• A powerpoint presentation with explanation of the process and ratings.

Next time: Examples of a build vs. buy