The price of software

The price of software, what elements could help understand it. How to make an informed decision?
The price of software, what elements could help understand it. How to make an informed decision?

A mandatory evolution? At what cost? It is difficult for a non-specialist decision maker to see the forest for the trees. How is one to make an informed decision? Software is often seen as an all-purpose tool. Yet, isn't the problem of organizing a company's activities a human one in its core?

The need for software

Implementing software in a company, big or small, is usually done for several reasons. One of the primary reasons is, as you might imagine, to secure a certain economic advantage. Usually, the goal is to save time on performing repetitive tasks. And thus, this economic advantage quickly becomes a competitive advantage. Imagine spending only 2 to 3 hours on customer outreach each week instead of the habitual 8 to 10 hours that your competitor puts into the same task.

And yet, although we often forget about it, software is just a tool. A tool that should be easily replaceable. What is important when implementing software is to clearly define how it is integrated into the company's processes. Sometimes, these processes are implemented together with the software itself. In that case, it is often an outside consultant who is in charge of training the members of the team. For a small organization, this kind of service is quite expensive. What can be even more detrimental than the pure cost is that approaching software implementation in this way does not necessarily correspond to the company’s existing way of operating. And yet, the way a company operates is often one of the main competitive advantages of such a small business. It is its source of pride, its very spirit that came into being together with the founding of the company. It is where the company’s most loyal customers find themselves, and it is what is at stake here. The unique way a company operates has been evolving and continues to evolve over time together with the company itself. The new software that is supposed to provide a competitive advantage must therefore be designed to not take over or replace the established ways of how a company operates, but itself be replaceable. It must be able to follow the natural flow of the company’s evolution, to change its own way of functioning, and, to make it easy for its users to take out all the data if they choose to migrate to another software.

A resilient organization is generally characterized by its ability to evolve. This ability rests on the proper identification of defined processes. It is these processes that can and should evolve in a thoughtful and concerted way to truly serve the interests of the company and its people, instead of hotheadedly following any and all fads.

A mandatory evolution?

Implementing software in a company is often seen as an imperative, a sort of obligatory rite of passage imposed by the standards of our modern society, a mandatory step in the development of the company.

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A mandatory evolution?

However, software is only a tool and not a way of working. Thus, the overall development strategy of the business leader of any company must go well beyond simple software. Why implement a change (that might even encounter quite a bit of pushback because we all are creatures of habit and find change difficult to deal with at times) if the company’s procedures run smoothly? On the other hand, if certain points of tension have been identified, why not work on these precise points? For example, two of the problems often mentioned are the tediousness of data entry and the complexity of manual processing of management information. Internal needs are often simple needs of finding a better way of organizing data, information, etc. Thus, the currently established practice of dealing with data entry in a certain way can be just an inefficient way of working which in its turn shows a need for evolution.

Questions ...

In any case, why deprive yourself of powerful tools? Why not adopt a tool that can be adapted as closely as possible to the current way of working, yet would enable to eliminate the boring and tedious manual work? Why necessarily question the organization of the company? With or without software, the best strategy is often to adopt a system (be it a software system or not) that enables implementing gradual changes and adjustments in the way the business operates.

Granted, modern tools can be efficient. But at what cost does this efficiency come? The price differs from one offer to another in quite a drastic manner. Some software is free while others can amount to tens of thousands of euros of annual investment (if not more!). It is difficult for a non-specialist decision maker to see the forest for the trees, not to mention to understand what has a direct influence on the price of a given software. How is one to make an informed decision?

Software is often seen as an all-purpose tool. Yet, isn't the problem of organizing a company's activities a human one in its core?

The price of software

For each category of business activity, there exists a software, and there are as many forms, shapes, and sizes of such software (metaphorically speaking), as there are respective markets. The factors influencing software prices are surely endless, but let’s consider a few prominent ones.

Closed vs. Open

One of the biggest divides in the software world is that of free software versus proprietary software. Proprietary software is usually developed by a commercial company that does not publish the source code of said software. Source code is the program code that instructs the computer to execute certain calculations that make up the operations of the computer. Free software provides access to the source code of the software. This allows a company that depends on such software to secure its access to that software and to possibly modify some of its parts to fit its needs. However, these modifications require high-level computer programming skills.

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Closed software vs. Open software

The main advantage of proprietary software is that it comes with a direct link to the software creator whose main goal is to provide a good service (to drive good sales) and to ensure the ease of use of his software. Such software are often integrated into a global ecosystem that offers additional support and training services. The sustainability of proprietary software is directly dependent on the profitability of the software. A software company that sells its software at a loss is posing a risk not only to its own survival but to all of its customers as well. The main drawback of proprietary software is, therefore, the direct dependence of the end-user on the commercial strategy of the software provider. The latter can decide to remove the software from the market altogether at any time, leaving the user without any updates or maintenance. Moreover, the customer looses the ability to access the ecosystem that had time to develop and grow around this software.

The advantage of free software is mainly its technical durability. The user of free software will always have access to the source code of said software and can modify it or have it modified by a professional. The free software movement was born out of an ideal of information sharing and cooperation. The programmers realized rather quickly that sharing their software code saved them and their colleagues a lot of unnecessary work. Indeed, the main chunk of the cost of software falls on the phase of its initial development. Once released each further copy of the already existing software costs next to nothing.

By the 1950s, most software development was happening in universities. Knowledge exchange has established itself as an important widespread practice. Free software was starting to attract increasing attention to itself not least due to another, rather important, advantage - its price. The open and free-of-charge access to the source code of free software that can be reused and modified to the user’s heart’s content has driven the software prices down (making some software completely free, thanks to the enormous contributions of a multitude of volunteers). Yet, although some software can be accessed easily and free-of-charge, others require professional expertise and in-depth knowledge (i.e. compilation, configuration, etc.) - both of which are anything but free.

The degree of the ease of use of free software is, in general, its main drawback. Open-source projects are often launched by enthusiasts looking to create software corresponding primarily to their own needs rather than the needs of a wider audience. Some projects resonate with a number of people, becoming subsequently extremely collaborative and receiving contributions from several thousand volunteers. And although having high numbers of contributors can be considered a stroke of luck for the project both in terms of diversity of ideas and points of view, it can sometimes result in a lack of coherence within different parts of the final software.

At this moment in time, Simitless is proprietary software. As of writing this article, this platform is the work of a single creator. Remaining in full control of the source code during the initial phase of software creation gives me the opportunity to retain the project’s agility. This is something that I would not have been able to do had I chosen to open source Simitless straight away. An open-source project is open at its core, meaning that its internal functionalities can be changed at any time by any willing contributor. And, since these changes are not necessarily formally documented when they are introduced, it is difficult to maintain the project’s continuity. Yet, continuity is extremely important for open source projects, as it is vital to provide new contributors with certain compatibility between the different versions of the different software modules to be able to work on the project further.

Human vs. Machine

Automation consists in having machines do the work that has hitherto been done by humans. The more complex and sophisticated the software, the more time it took its creators to implement the information processing instructions that define its functionalities. (Sometimes these instructions are so complex that one needs to create an altogether separate software first in order to define these instructions. This is the basis of Artificial Intelligence. For reference, I define “intelligence” here as "faculty of knowing, of understanding".)

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Human vs. Machine

The cost of running machines, or, in our case, software, is generally relatively low. The actual cost comes from the difficulty of creating them and the complexity of their design. Simply put, there are typically two approaches:

  • An IT professional thinks about all possible scenarios for a specific situation and formalizes the problem. Then they go on to develop the software that addresses this problem: a software solution. The downside of this approach is its lack of flexibility, as not every user has the exact same problem they are trying to solve. On the other hand, a huge advantage of this approach is that all the investment has been made in the initial phase of the development, keeping the price that each additional user has to pay for the software low. Thus, the license for existing software can be as low as a few dozen of euros/dollars.
  • An IT professional creates a set of tools that reduce the complexity of a single type of problem. A consultant working with said professional then spends time with each potential customer to set up the software, configure all the modules (tools), possibly add custom modules, to finally train the end-users to manipulate the software correctly. In a perfect world where communication between the customer and the consultant goes without a hitch and the tools are sufficiently flexible, this approach ensures the creation of the perfect software that completely meets the user's needs. On one hand, it is a clear advantage. On the other hand, it comes with a corresponding price tag. This type of service costs anywhere between €20,000 and €100,000 for a rather simple and small scale software solution for small businesses.

For Simitless, I chose to provide a set of very sophisticated tools that work and fit each other like clockwork. It's a bit of a hybrid approach. The thinking behind it is that by providing the tools, the documentation, and a substantial number of templates, a user would be able to set up custom software for their own use. As it is, the user becomes their own consultant. As a result, Simitless can offer very low prices compared to other custom software. The drawback is, of course, that considering the price Simitless simply cannot provide a personal consultant who would work with the customer/user to formalize their needs. Therefore, if the user feels that they need someone to help them structure their app properly, they should consider getting in touch with an independent consultant or a reseller who could assist them with defining their needs. The advantage for small businesses that make out the core of our customer base is that other than a little time, the cost of the initial investment is zero. For a freelancer or a micro-business, the choice between 2 hours and €10,000 investment is quite an easy one.

Software vs. Service

Software can be sold either as a product (similarly to material goods) or as a service. Legally, however, it is neither really one nor the other: when buying software, you are buying the right to use it (via a license agreement). Thus, this transaction depends mainly on the intellectual property laws.

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Software vs. Service

Let’s assume that software is a product on par with material goods. Once acquired, the software works autonomously, that is without any intervention of its creator. The user can, thus, use the software without any time limit and without having to pay extra. However, following the same logic, the user is likewise not entitled to any updates, maintenance, or assistance, without signing an additional contract for the aforementioned services.

Let’s try and give a definition of the concept of “service”. A service, short for "service provision" or “service delivery”, is a predefined set of actions that a contractor provides a customer with, in return for financial compensation. Thus, as per definition, the concept of service implies a certain work that a human must in general accomplish.

The world of software, as is often the case, is in this respect unlike any other. The concept of "Software as a Service" or SaaS is gaining more and more momentum. Indeed, although buying software might look like buying a product, modern functionalities that define the software (i.e. synchronization, communication, remote access, etc.) make software technically a different type of “product” that must provide its users with a communication infrastructure that needs to be maintained over time. Most often this infrastructure consists of a set of servers that must be hosted, maintained, secured, backed up, etc. This is why the majority of software vendors charge their users a monthly subscription fee that is set to cover infrastructure maintenance costs. More often than not, the price of the software itself is included (or hidden) directly in this periodic subscription for the sake of simplicity of the commercial offer.

Simitless has decided to adopt the SaaS model. The subscription includes access to the platform, hosted on a web server. Subscribing to the platform to get this access works similarly to accessing a website. However, this access comes with real-time synchronization between several users working with the same software. In addition to being able to create one or more custom-built software on the Simitless platform, the subscription provides secure access, backup systems, and collaboration tools specifically designed and adapted for working online - a technical choice in line with the spirit of the time.

Desktop vs. Cloud

Software installed on a desktop computer has long been the norm. Most Office Suites (Word, Excel, OpenOffice, etc.) follow this norm. However, nowadays we are increasingly confronted with software hosted on the internet (i.e. in the cloud).

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Desktop vs. Cloud

These new cloud-based systems have some drawbacks:

  • They cannot be accessed if there is no internet access;
  • They depend on the sustainability of a third party company;
  • They encounter performance issues if the internet connection is slow.

Yet, this new paradigm has many advantages:

  • Security: with the cloud-based software being permanently “online”, the systems are designed to be secure from their early development. Cloud-based software encounters neither virus nor ransom attacks problems, it is not at risk even if your computer gets stolen or your offices are set on fire. Data hosting centers have some of the most drastic security protocols (i.e. redundant power supplies, redundant internet accesses, automated fire protection, incremental backups on an external site, elevated anti-flood premises, anti-intrusion protection, internet firewall, retinal biometric security, 24/7 security and video surveillance, strictly controlled physical access, regular independent audits, certifications, etc.). The strength of your password is basically the main thing that poses a major threat to the security of your account.
  • Access from anywhere: Data that have been input into software installed on a desktop computer are usually accessible only on that particular computer. If anything happens to said computer, the data is as good as gone. Cloud-based software, on the other hand, can be accessed via any workstation as long as one has the correct login and password associated with it. What this means is that even in case of a major computer disaster, work can resume without further delay as all data of a given information system is readily accessible;
  • Same access, no matter the hardware: Cloud-based software can be accessed from any modern internet browser (Chrome, Edge, Firefox). You do not need to worry about the hardware you are using. It can be anything: a computer, a tablet, or a phone, running Windows, Mac, Linux, Android, iOS. Most modern computer platforms are compatible with any given cloud-based software. It is even possible to use said software on different platforms at the same time.
  • Backups: Data are permanently backed up. It is almost impossible to lose data stored in cloud-based software without some pretty monumental handling error.
  • Updates: Cloud-based software is constantly updated. The problems of maintenance, migration, or incompatible versions no longer apply to such software. Each time the software is accessed, the latest version is available on all workstations.

Simitless has decided to go exclusively the cloud-based software route. One of its major advantages, among other things, is that it offers the users the option of real-time collaboration. Granted, in the unfortunate event of a brief loss of connection, the software would continue working although with limited functionalities. However, the normal use of the platform relies on your hardware being connected to the internet. To increase Simitless’ accessibility, the platform is fitted with PWA (Progressive Web App) technology. In addition to certifying a certain level of responsiveness and quality of use, this technology gives the user the option of installing a software shortcut on the desktop of their computer. Thus, the user can open the software directly in its own window, partially hiding the fact that there is an internet browser that acts as an interface between their computer and the software.

Form vs. Function

The form (looks) vs. function debate is not new. All existing products have had to deal with it to find the balance that was right for them. On the one hand, in order to be useful and usable, software must run smoothly. On the other hand, neglecting the design aspect of software can be just as detrimental as poorly coded software. If the software does not “catch the user’s eye”, the likelihood of it being adopted is rather low. A technically perfect execution poorly presented will be rejected by the market and will put a strain on the survival capacity of the company.

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Form vs. Function

Today's online software market is littered with graphically over-optimized products, looking very high-end but lacking in their functionalities. Focusing on an attractive design, but having only a few features on offer, enables a faster product launch, thus, a faster return on investment. Unfortunately, this is done to the detriment of the service provided to users, who often find themselves seduced by software less efficient, less flexible, and presenting major problems in terms of information portability. With information portability being one of the least profitable features, it is doomed to be one of the last features to be developed reliably, if at all, by the software creator.

Focusing on the function, therefore, provides greater value for the user but is more expensive to accomplish, while focusing on design gives an impression of accessibility and maybe even of value. However, if the latter is done to the detriment of the former, the user may end up with an empty shell. Only advantage - this empty shell can seem more fashionable for users and potentially... bring in more money to its creators than really well-thought-out software...

The goal of Simitless is to provide software that is easy to use, appealing to the eye but, above all, practical. When there was a choice to be made, Simitless always went for practicality, usefulness, and, first and foremost, flexibility, rather than focusing on a trendy presentation that adds nothing of value for the long-term use.

Fashion vs. Need

Similarly, the software market is subject to fads. This applies to the technologies adopted by developers as well as to software brands regularly coming in and out of fashion. For example, web messaging has appeared very early on in businesses. First, it was fashionable to use AOL, then MSN messenger, Yahoo messenger, then Skype, Slack, Discord… the list goes on and on hand in hand with fashion trends. Some brands have more success than others. Yet, the need remains the same - the need for written communication, faster and less formal than email, easy to use, and, above all, familiar. This is why each generation of employees finds the software of their elders outdated and prefers to use software that is familiar to them.

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Fashion vs. Need

Primarily, what a company needs is to be able to change its procedures and practices in a defined and controlled manner. Fashions can be helpful to draw attention to a new need that is being created within the company itself. However, they should in no way impose evolution. For example, many small scale businesses and freelancers do very well with a pen and a notebook to manage their accounts. Why change a system that works? The need to change, to evolve comes about only when the business’ practices fail to follow the needs of the business. If an employee or the business owner themselves has to spend several hours a week transferring data from a few loose pieces of paper into a spreadsheet to be able to actually manage their business, maybe it is a sign that their management practices need to change.

Simitless is not in the business to blindly follow arbitrary fashion trends. Doing so might mean that we are losing out on a big chunk of a potential market share that we could easily acquire but that is not what we are after. What matters to us most is building a lasting relationship with the users who need our service and want to use the software rather than Simitless being imposed on them by some subjective standards.

Custom vs. Off-the-shelf

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Custom vs. Off-the-shelf<

It would take a separate full-fledged article to flesh out the difference between off-the-shelf software and custom-made software. Failing the time, let me focus on the most essential points. Tailor-made software fully adapts to the needs of the user. Off-the-shelf software requires the user to adapt to it. This is why custom-made software typically costs over several tens of thousands of euros while off-the-shelf software can easily be purchased for a few hundred euros (or in the case of open-source software, even for free).

Cheaper, you say? Cool, then off-the-shelf software it is! But is it really that much cheaper? How will implementing new software that might require reorganizing the processes and operations of your business impact your company? How much would you have to invest in training your employees to use this software? (And I am talking here about both monetary and temporal investment!) And then, if both you and your competitor use the same software and have assumed the same way of operating, managing, in short, doing business, what is your competitive advantage? (Apart from, of course, your foolproof genius and your one-of-a-kind character...)

Custom software is not a wasted investment in the future. It can evolve with your business. And yes, custom software is more expensive, but it gives you more flexibility, it is your exclusive ally that strengthens your operations and accelerates your activity.

Simitless is designed to be a platform for creating custom software. The concept of a platform for creating custom software may seem a little complicated at first glance, but let me assure you that it is not. Most of the off-the-shelf software, especially management software, use similar components. These "software bricks" are constantly re-created for each newly developed software. Yet, off-the-shelf software offers pre-assembled bricks that cannot be rearranged. Simitless, on the other hand, provides pre-existing "software bricks" and ready-made assembly diagrams, or templates. Although the platform might not support all the configurations, the possibilities to develop custom software to fit just your need are still limitless with Simitless. In other words, Simitless gives you an easy and risk-free access to the world of custom software.

Time vs. Money

It is best to have both. Yet, often these two elements stand in opposition to each other. One has to choose between sacrificing a little money to save time or sacrificing a little time to make money.

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Time vs. Money<

The goal of automation is often to spend a little more time and a little more money now to later save time over a longer period in order to save money on paying for the time. Still with me so far?

A freelancer charges their customers for the amount of time spent working on a task. The more a freelancer can accomplish within a certain span of time, the more he can charge. Setting up an automation system during their downtime would enable them to save the time usually spent on repetitive tasks later. But if the cost associated with setting up this automation system represents the equivalent of several thousand billable hours, how is one to go about it?

What I would advise is to start simple, approach the problem step by step. Automate first one task, then another, and, above all, stick as closely as possible to your existing methodology of managing your activities, if it works. Nothing prevents you from changing the way you run your activity, of course. Just keep in mind that the smallest adjustments are the easiest to control and integrate.

We designed Simitless’s pricing to be flexible to align with the value of the service provided by the software. We have committed ourselves to keep the prices as fair as possible to, on the one hand, be able to make a decent and independent living from our work without having to produce exorbitant margins intended for passive investors, and, on the other hand, to be affordable for small businesses. What is of paramount importance to us is a steady and natural evolution of the practices of our customers. We firmly believe that the proper implementation of software is supposed to save our users time and reduce such risks as data loss to the organization. Good software should cost less than what it would cost a company to operate without it.

A deep reflection

The decision to adopt an automation solution, or any other solution for that matter, must be an integral part of a long-term strategy for the evolution of the activity in question, considering its overall goals and objectives. Estimating the amount and the cost of work that is eliminated by adopting an automation solution is an important factor to take into account. This information should then be compared to the value the automation solution adds to the processes. Delegating repetitive tasks to an automation system can reduce the number of errors and lead to faster task completion (which, in its turn, reduces the production cycle time).

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Strategy, a deep reflection<

Simitless

With the Simitless platform at your disposal, you can now create for yourself (almost) custom software at off-the-shelf software prices.

Simitless software is:

  • a risk-free solution - you only pay when you use it, and we even give you a small quota of data you can input to test the platform for free;
  • an affordable solution - since our prices are based on your particular volume of data, files, and users, you only pay for what you estimate you need for your applications;
  • an adaptable solution - you can reduce or increase your quotas without prior notice, without confirmation, without difficulties at any time.

Simitless is a tailor-made solution for the price of off-the-shelf software. There are no surprises, no pulled-out-of-thin-air pricing. All our prices and as well as an instant cost calculator are readily available at https://pricing.simitless.com.

Illustration de satellite, logo de Simitless

Autonomy and Assistance

Simitless is also setting up a network of independent consultants. Soon you will be able to get in touch with a consultant in your area who could guide you in the design of the custom software to automate your business operations. That does not stop you from asking for assistance from our team directly via the platform, of course. I will give it my all to help you set up the software elements you require to build your software. After all, as I have already mentioned above, I really want Simitless to be of use to you.

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Autonomy and Assistance