John Doe

Workplace Writing 1

Touchstone 2.2

August 4th, 2023

Custom Software vs. Third-Party for Payroll

Due to a change in how our company is handling employee compensation, our

department must consider options for moving payroll to an automated system. Currently, two

implementation methods are being considered: designing in-house custom, or contracting with a

third party such as Gusto who will provide the necessary software. As the company weighs this

decision, several areas of importance become clear, particularly cost effectiveness, system

integration, security, and start-up time.

When examining the cost-effectiveness of creating custom, in-house software versus

purchasing a third-party software, our department must consider its budget and long-term goals.

Custom in-house software can be tailored to our organization's unique requirements, which can

lead to quicker productivity. However, when it comes to relying on in-house software, there are

many cost factors to consider, such as the cost of designing the software. One study (Ustinov,

2023) found that, "43% of IT projects exceed their initial budgets, 49% are late, and 14% fail

altogether" (para. 4). The department needs to be mindful that not only is there a significant risk

of going over budget, there is also a risk of failure altogether. In short, there is considerable

uncertainty when creating an IT project.

On the other hand, third-party software provides exact fees and maintenance costs

upfront so that companies understand just how much they are investing into the new system.

When thinking about cost-effectiveness, buying from a third party gives the department the
privilege of being able to tailor the budget around fees that they are already expecting rather than

taking into consideration the many extra fees that come with creating custom software. For

example, Gusto offers up-front flexible pricing for companies. Gusto has plans that start from

$40 a month, plus $6 per person. Prices go up depending upon what plan a company chooses, but

costs are clear and predictable (Gusto, 2023). Clearly, the startup costs of using third-party

software would be significantly lower, but in-house solution may save money in the long run.

The costs ae not the only consideration, however; system integration is equally important.

System Integration is another crucial factor when deciding what software will be the most

beneficial for the department. When it comes to custom in-house software, system integration

will be a seamless process due to how easy it is to adapt the custom system to the department's

existing systems and structure. Since the department is the one that made the software, the

integration process should be more comfortable for the employees as well, since the product’s

design ethos will follow that of existing in-house products. There should be little difficulty for

the department to adapt to the software that they created for themselves.

In contrast, if the department were to buy third-party software such as Gusto, then they

would have to adapt their system to that software instead, only using other financial software that

is compatible with the third-party product. In other words, there is less flexibility regarding

system integration since we would be limited to products that are compatible with the third-party

payroll software that we adopt. Fortunately, however, the list of compatible software for Gusto is

quite long, including, “QuickBooks, Xero, Aplos, ZipBooks, Autobooks, and FreshBooks, plus

other types of software like Expensify, Hubstaff, Clover, Homebase and more” (Gusto, 2023). If

we design an in-house platform, it would likely not be feasible to create this much compatibility,
and so our surrounding software options may become more limited. This may become a problem

as technology advances and products and computer compatibility evolve.

Another concern related to the evolution and advancement of technology over time is that

of security. This is a concern whether the department chooses a custom in-house or third-party

software; however, the potential advantages and disadvantages are different for each. With

custom in-house software, the main concern is whether the department can create strong enough

security within the software to keep up with ever-evolving cyber attacks. As the years go by,

hacking and cyber attacks have become more advanced, making it even harder to protect

sensitive data. The department must ensure they are ready to safeguard employees' vulnerable

information at all times with a tried and tested system that can handle new cyber threats. In

comparison, using third-party software requires the department to rely on external software to

protect employee information. The department must be willing to trust a completely separate

third party with sensitive employee information. The department can be put at risk if there is a

cyber attack on the third-party software. According to the U.S. Chamber of Commerce (Barton,

2023), "Because hackers and online criminals know that third-party apps handle such valuable

information, they often target these apps" (para. 9). Given the limited return on investment,

hackers may be less likely to spend the time and energy to hack into a custom in-house system,

provided that our security is reasonably robust and up to date. Both options come with their own

set of concerns over security and data privacy. It is up to the department to make a research-

based decision for which one to choose while also taking into consideration the start-up time for

both.

Start-up times for both in-house software and third-party software can vary depending on

different factors and what the department requires. A custom in-house software will have to go
through initial building block stages that can take time depending on how fast the department's

IT team can work on it and how complex the software is. Since this is software made from

scratch, there are so many different factors that might need longer processing times than others

which can make the start-up time even longer. As technology consulting agency Soltech

describes (Tate, 2022), “On average, we see a software development timeline of 4-9 months. The

size and complexity of the project are the biggest factors in its overall duration” (para. 5).

Conveniently, the department can have control over their software and create or add any personal

changes to it, but at the same time, it can take longer to develop. In contrast, third-party software

comes pre-made, which cuts down significantly on start-up time. The department could integrate

this software without having to deal with the extended development process if it were self-made.

Although there must be a training period for any new software, this time would be negligible

compared to the time it would take to design the software in house.

When deciding which software to choose, the department must consider all the pros and

cons of each software. It is important to decide which software will meet all the department's

criteria and can be sustained long-term. The main concerns for the department are cost-

effectiveness, system integration, security, and start-up time. Considering all these factors should

be the first step in deciding which software to move forward with. It is also important to be

mindful that either software can only work as well as the employees and staff who use it.

Employees need to have patience and understanding when working with any new software, and

the department will require the full cooperation of the employees as we work through these

system structure changes.

Barton, R. (2023, June 8). How to Use Third-Party Apps Safely at Your Business. U.S. Chamber

of Commerce. Retrieved July 31, 2023.

https://www.uschamber.com/co/run/technology/using-third-party-apps-safely-at-your-

business

Gusto Pricing | Find the right plan for your business. (n.d.). Gusto. Retrieved August 4, 2023.

https://gusto.com/product/pricing

Tate, T. (n.d.). Custom Software Development Timeline | SOLTECH. SOLTECH, Inc. Retrieved

August 4, 2023. https://soltech.net/how-long-does-it-take-to-build-custom-software/

Ustinov, Nick. (2023, June 22). Building An In-House Solution Vs. Buying Software: Pros And

Cons To Consider Retrieved July 31, 2023.

https://www.forbes.com/sites/forbestechcouncil/2021/07/29/building-an-in-house-

solution-vs-buying-software-pros-and-cons-to-consider/?sh=f610b567dc52
 Reflection Responses

Did you use the point-by-point or block method to organize your body paragraphs? What
made you decide to organize your essay in this way? (3-4 sentences)

For my essay, I used the point-by-point method because it was easier for my topic. It made a
smoother transition for me to point out the pros and cons of each topic without repeatedly
summarizing everything. It also made it easier to point out different details about each topic
as well in order.

Consider the experience of writing in the informative mode. How was this different from
other writing assignments you have done? Did you find it difficult to refrain from providing
your opinion on the different methods you explored? (2-3 sentences)

Writing in the informative mode is a bit tricky because of how I have to write without bias,
which is naturally something that is hard to do if you are not used to it. I have written very
few informative essays so I was not used to not being able to voice my opinion. It is difficult
to refrain from providing my opinion because I have my own preferences. I think most
people have a natural biased tone in whatever they say or write, which is why informative
writing is so difficult.

How did you use technology throughout this process, both in writing your report and finding
sources? (2-3 sentences)

When writing this report I used technology in various ways. One way I used technology is
when I used Microsoft Word to check any simple spelling or grammar errors that I made on
the report. Another way I used technology was when I used various search engines to find
credible sources for the report.

Remember that the writing process is a recursive process, and your first draft of an essay is
rarely your last. Which part of the draft did you struggle with the most, and why? Since you
will be revising this Touchstone in the next unit, think about how you can improve the draft
once you continue the writing process with revision and editing. (3-4 sentences)

I struggled with the brainstorming and outlining part of the writing process the most. I am not
the most creative person, so coming up with a plan to match the provided scenario was hard
for me to do. I also struggled with outlining. For example, I knew I needed an introduction,
body paragraphs, and a conclusion, but it was hard to outline what I wanted to say in each
paragraph. To improve my draft for next time I will definitely read the report aloud to myself
multiple times to see if it makes sense when being read by someone else. I will also make
sure to run it through a spell checker.