Build vs. buy is a deceptively complex decision. The instinct to build custom software is strong in engineering-led organizations; the instinct to buy packaged software is strong in organizations with limited engineering capacity. Both instincts lead to mistakes when applied indiscriminately.
When to Buy
The case for buying is strongest when the capability is not a source of competitive differentiation, when mature vendor solutions exist that meet 80%+ of requirements, when implementation timelines matter more than perfect fit, and when ongoing innovation in the capability is best delivered by a vendor with economies of scale. HR systems, accounting software, and collaboration tools are almost always better bought than built.
When to Build
Custom development is justified when the capability is a source of competitive differentiation (competitors shouldn't have access to the same tool), when the specific requirements are genuinely unique (no vendor solution fits), when the long-term cost of vendor licensing exceeds build costs, or when integration requirements make vendor solutions impractical.