Business Core · Technology · Module
Build, buy or subscribe
Deciding, for each capability, whether to build it, license it or rent it as a service — and recording why, so the reasoning can be revisited.
The idea
How it works
The question has had three answers since software moved to subscription, and they differ less in price than in control. Building keeps control and the whole burden of upkeep; licensing shares it; subscribing hands most of it to the provider along with the pace of change. Transaction cost economics frames the choice: capabilities that are specific to the firm and hard to specify in a contract tend to be cheaper to hold inside.
Wardley adds the question of how evolved the capability is. Something still novel, and differentiating, is a candidate for building; something that has become a commodity seldom repays being built, however confident the team. Many regretted sourcing decisions are custom builds of commodities, or rented versions of the one thing that set the organisation apart. The contract that follows a decision to buy or subscribe sits with Partners under the agreement.
Working with it
In practice
- 01
Place the capability on its evolution
Novel, custom, product or commodity. The stage narrows the sensible options before any vendor is compared.
- 02
Count the whole cost over time
Integration, upkeep, security, training and exit belong in the comparison next to the price.
- 03
Price the exit before entering
How the data comes out, in what format, and how long a move would take. Lock-in accepted knowingly is a decision; discovered later, it is a constraint.
- 04
Write the reasoning down
A dated decision record lets the choice be reopened when the conditions it assumed have changed.
One level in
The components of build, buy or subscribe
A component is something that exists afterwards which did not exist before — a deliverable or a mechanism, not an intention.
Capability evolution map
The capabilities in question placed by how evolved and how differentiating each is, which frames what is worth building.
LearnSourcing decision record
The options considered, the whole-life cost of each, the choice made and the change in conditions that should reopen it.
LearnLock-in and exit assessment
What leaving would require — data, integrations, retraining, time — assessed before the commitment is made.
Learn
Build what differentiates, rent what has become commodity, and write down why. Conditions change, and the record is what allows the choice to change with them.
The other modules in technology
The technology estate
What systems the organisation runs, how they connect, and the few principles that decide what may be added to them.
LearnAI and automation
Where AI and automation are used, who remains accountable for what they do, how well they are shown to work, and what risk each use carries.
LearnSecurity
Protecting the estate as a capability: knowing what is worth attacking, holding a baseline of controls, managing who can get in, and being able to recover.
LearnTechnical debt and renewal
What the estate owes to decisions made earlier, which of those debts are worth repaying, and how ageing systems are replaced without stopping the business.
Learn