When Enterprises Should Build, Buy, or Partner for AI

Artificial intelligence (AI) is making it easier and cheaper to build custom software, but that doesn’t necessarily mean companies should start building everything themselves. In a recent ERP Today article, we explore how enterprises should approach the growing “build, buy or partner” decision for AI. The article argues that the choice is becoming less about upfront price and more about long-term costs, data control, integration, security and whether a capability provides something unique to the business.

So, when does building make sense? The strongest case is when AI depends on proprietary data, specialized business knowledge or a workflow that gives the company a competitive advantage. Generic capabilities, on the other hand, are often better candidates for an existing platform or vendor solution. But building isn’t automatically cheaper. AI coding tools can reduce development time, but companies still have to pay for infrastructure, model usage, security, integration, monitoring and ongoing maintenance. Those costs can add up over the lifetime of the system.

The article also points out that “buy” isn’t the only alternative to “build.” Companies can partner with vendors, build their unique workflows internally and use outside providers for the underlying AI models or infrastructure. For ERP (enterprise resource planning) leaders, that means the decision should be made workload by workload. Companies should consider how much customization and control they need, how sensitive their data is, what they can realistically maintain internally and how difficult it would be to switch vendors later.

AI is changing the economics of software, but building isn’t automatically better. The right approach depends on what makes the business unique and what it can realistically support over time.

 

For Full Article, Click Here