No Budget for Off the Shelf Software?

I was reading a question today on StackOverFlow that was asking for advice on how to build a load-testing program for a website. At the end of the question is the following parenthetical remark (preempting the obvious answers pointing the questioner at any number of applications available for purchase that do exactly what they need):

We have a budget for programmer time but no budget for buying software, so it wouldn’t matter how money we’d save to buy a COTS product.

This strikes me as a pretty stupid corporate policy that in the end will result in the company spending more than they need to in order to reinvent the wheel. What is they would save 1,000 programmer hours by spending $1,000 on one piece of software. It is not too far fetched. In today’s programming world, the most capable development teams are those that know how and when to leverage expertise from outside of their immediate circle (and outside of the company payroll, when necessary). I realize that from an accounting perspective, one could claim that payroll is a fixed, budgeted cost, and since the developers have to be paid anyway, why shouldn’t they do everything in house? But every hour spent on developing something in-house that could be bought elsewhere for less money than the cost of the salaries being spent is another hour that the company could have used to use its employees for increasing its own revenues and profitability. Oh well, their loss.

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One Response to No Budget for Off the Shelf Software?

  1. Chris Mahan says:

    Well, that would make sense _if_ the IT department was able to account for loss of developer time, as well as opportunity cost.

    Unfortunately, these two are very hard to quantify, so the only reliable metric budget-slaves have is the expenses. These translate very simply in payroll + other. Since it’s very hard to reduce payroll, managers are pressured to reduce the “other” category. And that simply means that software (and hardware to some extent) purchases are more often than not cut out of existence.

    This doesn’t occur at companies that understand that IT capabilities are a competitive asset; only at companies where IT is a cost center–which is most of them, I believe.

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