How to Decide Whether to Build or Buy Artificial Intelligence Capabilities

How to Decide Whether to Build or Buy Artificial Intelligence Capabilities

Naveen Joshi 30/01/2023
How to Decide Whether to Build or Buy Artificial Intelligence Capabilities

Buying or building AI applications and capabilities requires a thorough understanding of the market and the internal operations of the organization.

The urgency to position oneself over competitors is widespread. Globally, all organizations are trying to be the dominant leader in their industry. One way CIOs can help their organization reach their goals of besting their competitors is through AI integration. The use of AI applications and their capabilities has long proven its benefits in all industries, growing its expected market size to $1394.30 billion by 2029. However, to utilize AI applications that can rival an organization’s competitors, the question that requires answering is whether to build or buy AI capabilities.

How to Decide Whether to Build or Buy AI Applications


There are certain factors that a leader should consider before deciding whether to build its organization’s AI applications and capabilities from the ground up or source it from a vendor.

1. Analyzing the Issue

An organization can face certain challenges in its operations, and to evade such challenges, it will first analyze the issue and figure out how AI can provide the solution. Sometimes. the key to such problems can lead to something unique and unrivaled by interpreting mountains of data to provide viable answers. To do so, the organization needs to decide whether the solution to the challenges will be done by building the AI capability or sourcing it from a well-established vendor that can help them decode the issue. Some companies may not have the finances to build an AI and can, therefore, buy it from a vendor.

2. Researching and Screening Vendors

Suppose an organization is thinking of buying the services of an AI vendor. In that case, they need to obtain a list by conducting market research to understand who offers the solution you require based on the capabilities required for current and future use cases. However, there is a possibility for the firm to face risk if it decides to procure the services of the only vendor providing the required AI applications. An organization needs to conduct due diligence to avoid being in the pitfall of risks that come with third-party AI providers.

3. Enhancing the Skill Strategy

An organization should carefully consider the skills they hire if looking to build AI applications. They can also create an opportunity for themselves to harness a mix between making and buying AI applications and reap the benefits. Firms should find ways to cut corners and minimize their technical debt. With the skills to build, improve and maintain the product, organizations can create an enhanced AI application and achieve success by addressing the advantages of a mixed strategy or building and buying its AI capabilities.

Final Thoughts

AI applications have the capability to provide organizations with a path to creating groundbreaking solutions for their organization and allow them to position themselves at the top of their industry. However, integrating such AI capabilities requires them to deeply understand its technical budget, workforce, time and other factors if building it from scratch or buying it. Even if an organization decides to avail of the services of a third-party AI vendor, it must be careful about the possibility of facing a vendor lock-in. Extensive questioning will let the CIOs make the correct decisions in creating well-rounded AI applications and capabilities.

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Naveen Joshi

Tech Expert

Naveen is the Founder and CEO of Allerin, a software solutions provider that delivers innovative and agile solutions that enable to automate, inspire and impress. He is a seasoned professional with more than 20 years of experience, with extensive experience in customizing open source products for cost optimizations of large scale IT deployment. He is currently working on Internet of Things solutions with Big Data Analytics. Naveen completed his programming qualifications in various Indian institutes.


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