Custom software (also known as bespoke software or tailor-made software) is software that is specially developed for some specific organization or other user. As such, it can be contrasted with the use of software packages developed for the mass market, such as commercial off-the-shelf (COTS) software.
Advantages: Custom software will generally produce the most efficient system as it is can provide support for the specific needs of the business, which might not be available in an off-the-shelf solution and will provide greater efficiency or better customer service.
Given a suitable approach to development, such as DSDM, custom software will also produce the best or most well-targeted service improvement. Businesses can tailor the software to what their customers want instead of having to choose a package that caters for a generic market. For example one printing business may want software that responds in the shortest time, whereas another printing company may focus on producing the best results, as these two objectives often conflict an off-the-shelf package will normally sit somewhere in the middle whereas with custom software each business can focus on their target audience.
Although not always the most suitable for larger or more complex projects, a spreadsheet allows less technical staff at a business to modify the software directly and get results faster. Custom software can be even more flexible than spreadsheets as it is constructed by software professionals that can implement functionality for a wide range of business needs.
Disadvantages: The main disadvantages of custom software are development time and cost. With a spreadsheet or an off-the-shelf software package, a user can get benefits quickly. With custom software, a business needs to go through a Software development process that may take weeks, months, or with bigger projects, years. Bugs accidentally introduced by software developers, and thorough testing to iron out bugs, may impede the process and cause it to take longer than expected. However, spreadsheets and off-the-shelf software packages may also contain bugs, and moreover because they may be deployed at a business without formal testing, these bugs may slip through and cause business-critical errors.
Custom software is often several times the cost of the other two options, and will normally include an ongoing maintenance cost. This will often make custom software infeasible for smaller businesses. These higher costs can be insignificant in larger businesses where small efficiency increases can relate to large labour cost savings or where custom software offers a large efficiency boost.