Oct 14

Do you really want to build your screening technology platform with an in-house software team?

Lalith

Many screening companies think that’s the way to go. However, here are some facts that you might like to consider before taking a decision.

Table 1 – In-house development effort & cost – an estimate

Activities

Effort (person-days)

Per-day cost Rs. (Blended cost)

Total costRs.(in Lakhs)

Software requirements definition

90

5,500

4.95

Functional & technical design

80

4,500

3.60

Development

300

2,000

6.00

Testing

120

1,200

0.96

Project management

100

3,000

3.00

Total (A)

 

 

18.51

 

Table 2 – In-house development – On-going maintenance and support cost

Term

Resource Types

Cost over 3 years Rs.

(in Lakhs)

3 Years 1 x  Project Manager @ Rs.8 lakhs pa

24.00

3 x Developers @ Rs. 2.5  lakhs pa each

22.50

2 – Testers @ Rs.2 lakhs pa each

12.00

Total (B)

58.50

  •                                  In 3 years, with a market-proven screening operations technology platform YOU SAVE
  • In-house development: One-time cost + maintenance/support cost = A+B  = Rs. 77.01 Lakhs
  • Checks-360 (approximate cost of enterprise edition)                                           = Rs. 54.00 Lakhs
  • SAVINGS                                                                                                                         = Rs. 23.01 Lakhs

That was the financial comparison. Next, it is important to ask yourself the following questions from a business perspective and answer them candidly if you are contemplating developing your technology platform in-house OR you have developed one and are continuing to maintain and manage the platform -

  • 1. The cream of talent in the software industry has always opted to work with software services companies rather than end-user companies. Therefore, will you be able to handle the demands of your clients to have in place a highly efficient, scalable and secure technology platform? Even if you find the talent, will you be able to hold on to them?
  • 2. A mature product, like Checks360, is developed taking in the good practices followed by various screening companies. Will your in-house team be able to deliver this breadth and depth of industry knowledge?
  • 3. As a business owner or senior manager of a background screening company, on what should your prime focus be? Should that focus be on building your business or should it be on managing a team of programmers and their needs?

The conclusion is very clear.  In this day and age of rapidly changing technology landscape, developing a platform in-house, is a costly distraction to your business focus. 

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