Make vs Buy vs Partner: A Strategic Framework
Every technology capability decision is a make-buy-partner decision. Beyond the binary build-vs-buy choice, partnerships with vendors, technology companies, and specialist providers offer a third path — accessing external capability without full ownership or pure off-the-shelf adoption. A rigorous framework evaluates all three options systematically.
The Three Options
- Make (build internally): Develop the capability in-house. Full control, full customisation, full cost, full ownership of maintenance. Appropriate for core differentiating capabilities.
- Buy (commercial product): Purchase an existing product. Faster, lower initial cost, vendor-owned maintenance. Appropriate for commodity capabilities.
- Partner: White-label, OEM, API-based integration, joint venture, or strategic alliance. Access external capability without building or buying a standalone product. Good for capabilities that are important but not core.
Evaluation Framework
- Strategic differentiation: Does this capability differentiate us from competitors? Differentiating capabilities → build. Commodity capabilities → buy or partner.
- Speed of need: How quickly is the capability needed? Urgency favours buy or partner.
- Resource availability: Does the organisation have the engineering capacity and skills to build and maintain this?
- Market maturity: Are good solutions available to buy or partner with? Immature markets may require building.