What are the most significant  advantages and disadvantages of open-source database management software relative to proprietary products?

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Stephen Holliday | College Teacher | (Level 1) Distinguished Educator

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As your question implies, software for data management, as well as other applications, can usually be purchased "off-the-shelf" from a vendor or developed in-house.  Both have distinct advantages and disadvantages, and the choice depends on several factors unique to the business itself.

The great advantage to off-the-self software is its economics.  First, another company, presumably one that specializes in software development, bears the expense of development and, in many cases, will use its expertise and time to customize software for a particular customer's application.  Second, the company that needs the software saves the time and expense of dedicating part of an IT group, and the involvement of a business group within the company, to develop such software.  In cases of proprietary software, the development almost always requires both technical expertise--software developers--and some level of involvement of the end users of the software, a business group that would normally spend its time making money for the company.  Given the focus on holding expenses to the minimum these days, a copy that decides to develop proprietary software must be absolutely certain that off-the-shelf software is not available.  Ten or twenty years ago, that was often the case; today, it is not.

The chief disadvantage to off-the-shelf software is that it may not be capable of being customized so that it manages the kind of data that needs to be collected and distributed within a company.  Many financial-sector companies, for example, require nuanced levels of data management that may be too industry-specific for generic software.  Often, however, that generic software can be modified with a customized module that successfully adapts the generic capabilities to the company's specific needs.  Again, even ten years ago, scalable and customizable software did not exist in the varieties it does today.   Today, most software vendors involve the customer at every level of discussion so that, if the software can be modified, it will reflect the customer's primary goals for the software.

Proprietary software, on the other hand, because it is based on an intimate knowledge of the data a company needs in order to function optimally, is often the best choice because it reflects exactly, not generically, the data the company needs to compete effectively.  Rather than collecting one thousand data points, fifty percent of which is not germane to the company's primary goal, it collects the two hundred data point that the business groups actually use on a daily basis to carry out the business goals.  Proprietary software, in other words, significantly reduces the "noise," that is, data that gets looked at because it's there, but has no real relevance to the business at hand.  But, as I pointed out above, proprietary software is very cost-intensive because it requires dedicated people on the IT side, as well as the involvement of the end users to make sure the software collects the appropriate data and disltributes that data in usable form.

The decision about whether to purchase off-the-shelf or develop proprietary software always comes down to a cost-benefit analysis, and that analysis is dependent upon a range of factors specific to a company's business.  In general, however, in most manufacturing and service sectors, customized software from third-party vendors is the cost-effective for most companies.  

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