The Limitations of Homegrown Billing Systems

Homegrown is great for some things…

A few years ago, I built a billing system. OK, I didn’t build it all by myself—I was part of the management team that owned the project. It was a memorable experience for all the wrong reasons, but that’s a story for another day. When the system went live, I owned it, along with two other home-grown legacy billing platforms. My team kept those systems running and up-to-date with current requirements for years, which was a lot more difficult than it might sound.

Should you grow your own?

Grow your own works great for some things. My next-door neighbor grows the world’s best avocados in her backyard. Green perfection in every bite. But that home-grown ‘perfection’ comes with limitations. It took years for that tree to produce its first fruit, and it only bears fruit for about four months a year. Want guacamole in November? Make a trip to Safeway.

The same was true with those home-grown billing systems. They were a nice fit for our business on day one, and they did some things better than what we could buy off the shelf at the time. But they came with limitations that created a burden for our business. Those limitations fell into four categories; time-to-market, agility, cost, and resources.

Slow Time-to-market

That system build project had an 18-month timeline. And then slip happened. Our 18-month project went live in month 39. That last statement might scream “lousy project management” to you, but the truth is that about half of these projects never go live at all. I could probably write a book, or at least a chapter or two about why (Oh wait, I already did).

If you’re thinking about building your own billing system it will take longer than you think, and you’ll end up reducing scope to ‘minimum viable product’ level to go live. And ‘minimum viable product’ will not satisfy your business for very long. Which leads to…

Lack of Agility

It pains me to admit how often changes to our home-grown billing systems became the long pole in the tent in going to market with new products. As new delivery and charging models were developed, we found ourselves in a constant scramble to keep up. We built those systems to be flexible, but we didn’t know what we didn’t know.

You might think you know what your business will need five years from now. But then an Uber comes along and flips everything sideways. In a business environment where change is constant and opportunities are often defined in terms of days or weeks, your business can’t wait months for system changes to support a new charging model. But it’s not just time…

High Cost

It’s expensive to re-invent the wheel. Expensive in real terms, but also expensive in terms of lost opportunity. Every day lost in getting to market with a new product is an opportunity you can’t get back. I lived through product managers revising revenue projections down (and blaming me), because I couldn’t support what they were trying to do in the timeframe they needed it. And unless you’re a billing system vendor, building a billing system is outside your core competency—way outside. Which leads to a fourth limitation that is often overlooked in build or buy decisions…

Resource Limitations

Programmers with domain knowledge in billing are hard to come by. You may view coding as a commodity skill, but when it comes to billing, that view will lead to epic failure. It was a big part of our 39-month timeline and contributed regularly to our agility issues. We learned the hard way that it took at least a year to replace a senior programming resource on our billing platforms and get them up to speed. And frankly, a lot of those resources would have been better used building our business. If you are Amazon or Google and have seemingly unlimited technology resources, it might make sense to build your own. For the rest of us, not so much.

Conclusion

Home-grown is great when it comes to fruit (yes, avocado is a fruit). But home-grown comes with limitations. When it comes to the billing software that sits in the middle of your monetization ecosystem, those limitations can be the difference between success and failure. With the number of low-cost, highly agile solutions available in today’s billing marketplace, home-grown isn’t worth the cost and risk for your business.

Are you going to be involved in implementing a billing system? Whether it’s home-grown or in the cloud, be sure to check out the 7 Deadly Sins of Billing System Deployment whitepaper first to avoid deployment damnation.