Buy Vs Build - 2347 Words

Management of information resources
Buy Versus Build
MGMT 4331 Paper 02

Lyndsay Eddy

Table of Contents
Introduction………………………………………………………………………….. 2
The Five Decisions.………………………………………………………………….. 2
What does Buy Versus Build Mean………………...……………………………….. 4
What is the Best Option……………………………………………………………… 7
According to Carr…………………………………………………………………….. 7
The Ranking………………………………………………………………………….. 8
Conclusion...………………………………………………………………………….. 9
References...………………………………………………………………………….. 11

Introduction In the land of CIO’s, there are a series of important decisions that have to be made. However, all of their decisions boil down to buy versus build. The answer to this question is dependent on the IT team available, the organization or company needs, and the budget. This decision is unique for each organization due to the fact that their needs are different than other company’s and organizations. CIO’s need to have good analytical skills in order to weigh the pros and cons of any decision to better serve the needs of the company or organization and their workers. There is currently a trend going on according to Jason Ferrara, “an increasing number of CIO’s are opting to buy instead of build” (Ferrara, 2014). Pearl Zhu explains the reason behind the increase of buying is that building, “from scratch seems a little tough for most organization[s] as no one wants to redesign the wheel, even the vendors themselves rarely build their commercial solutions from total scratch” (Zhu, 2014).
The Five Decisions In order to better understand the buy versus build dilemma, one first needs to know all the decisions a CIO has to make. A CIO has two topics of interest: infrastructure and application. ” IT infrastructure consists of all components that somehow play a role in overall IT and IT-enabled operations. Infrastructure can be used for internal business operations, developing customer IT, or business solutions" (Janssen). Basically infrastructure consists of hardware, software, network, and meatware. Each component is defined below :( the list below comes from Janssen)
Hardware- Servers, computers, data centers, switches, hubs and routers, etc.
Software-Enterprise resource planning (ERP), customer relationship management (CRM), productivity applications and more.
Network- Network enablement, Internet connectivity, firewall and security.
Meatware- Human users, such as network administrators (NA), developers, designers and generic end users with access to any IT appliance or service are also part of an IT infrastructure, specifically with the advent of user-centric IT service development.
Within the two topics, a CIO has to adequately answer five questions per topic: maintain, acquire, decommission, upgrade and use.
Maintain means to fix the bugs or keep the system running. Whether it is a problem in the infrastructure or an application, the CIO has to decide is it worth keeping it running. For example, when windows 8.1 operating system (OS) came out, Windows decided to no longer support Windows XP OS. The CIO would then need to decide to upgrade the OS or maintain Windows XP themselves.
Acquire means to reuse, buy or build. Consider the Windows OS example. If the CIO decides to maintain Windows XP OS themselves, they can decide to reuse by integrating their own custom add-ons. The CIO can also decide to build an OS. If the CIO has the IT team to build an OS and the financial stability to build an OS, than whom better knows the needs of the business than employees of the company? If the CIO decides to go ahead and buy a new OS, then they will have to research and determine which OS fits the needs of the company.
Decommission means to take out of service. Since the Windows OS example fits all the decisions so well, let’s continue to use it. If the CIO decides to no longer maintain Windows XP OS, and to buy a new OS like Windows 8.1 OS, then Windows XP OS needs to be taken out of service in order to switch over to Windows 8.1

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