Build vs Buy Evaluation

Compare building, buying, and doing nothing on total cost, time to value, risk, and reversibility, ending in a defensible recommendation.

Evaluate whether to build this, buy it, or do neither.

The capability we need and the problem it solves: [WHAT AND WHY]
Who needs it and how often they would use it: [USERS + FREQUENCY]
What we do today instead: [THE CURRENT WORKAROUND AND WHAT IT COSTS]
Build option: [WHO WOULD BUILD IT, THEIR OTHER COMMITMENTS, ROUGH SCOPE]
Buy options: [VENDORS, PRICING, WHAT THEY COVER, WHAT THEY DO NOT]
Constraints: [SECURITY, COMPLIANCE, DATA RESIDENCY, PROCUREMENT TIME, EXISTING CONTRACTS]
How core this is to what we sell: [ON THE PATH OF OUR DIFFERENTIATION, OR SUPPORTING]

Produce:

1. **Options table** covering build, buy each named vendor, and do nothing. Columns: time to first value, cost year one, cost year three, ongoing owner and their load, what we control, what we depend on, and how hard it is to reverse.

2. **Total cost of ownership** for each option over three years, with the arithmetic shown. Include the costs that get left out: maintenance and on-call for build, integration and migration for buy, admin and renewals for both, and the cost of the workaround for doing nothing. Mark every estimate as ESTIMATE.

3. **Time to value**, honestly. For build, include the time to a version people will actually use, not a first demo. For buy, include procurement, security review, and integration.

4. **Risk comparison**: for each option, the two or three most likely ways it goes wrong here, given my constraints and my team.

5. **The strategic question**: does this capability sit on the path of what we differentiate on? Building something that is not core spends the scarcest thing we have on something a customer will never notice, while buying something that is core rents out our advantage.

6. **Reversibility**: what it costs to change our mind in 12 months under each option. Prefer the reversible option when the cases are close, and say when they are close.

7. **Recommendation**: one option, the two facts it depends on most, and what would change it.

Rules: use only my numbers, and where a number is needed and missing, name it as a required input instead of assuming one. Do not let the fact that we could build it settle whether we should.

How to use

Build estimates are wrong in a predictable direction: engineers estimate the first working version and the real cost is the years of maintenance nobody assigns an owner to. Forcing an ongoing-owner column surfaces that before the decision rather than after. The reversibility criterion is the tiebreaker to use when the numbers are close, which they usually are, since a cheap wrong decision you can undo beats an expensive right one you cannot.

Originated fromStan SedberryUpdated
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