Implementing an Industrial IoT platform: Make, Buy, or Hybrid?

Machine builders that want to implement an Industrial IoT (IIoT) platform face an important decision: whether to make a custom solution, buy an off-the-shelf IIoT platform, or opt for a hybrid approach that combines both. There are a few things to consider for you as a machine builder to make the best choice for your business.

It’s not that easy to make a decision: being a smaller machine builder does not automatically mean you should buy a solution, just as larger machine builders do not necessarily always want to choose for “Make”. It depends on several factors. The 6 most important ones to take into account are listed below:

• Customization
• Time-to-market
• Technical expertise
• Investment
• Security risks
• Scalability
  
  

The Make or Buy Challenge: Considerations

The Make, Buy and Hybrid approach each have their own set of pros and cons. Below we briefly list the differences between the approaches per key factor:

Customization

• Make: Maximum customization ensuring the Industrial IoT platform perfectly fits your needs.
• Buy: The platform comes with predefined capabilities and configurations, limiting customization options.
• Hybrid: The platform has a foundation to build on so it can be tailored to your needs with additional features and integrations. 

Time to market

• Make: Time-consuming since you need to take care of the design, development, testing, deployment, and maintenance of the platform.
• Buy: Can be deployed quickly since they are pre-built and tested.
• Hybrid: Can reduce time-to-market compared to building from scratch, depending on the desired level of customization

Technical expertise

• Make: Requires extensive technical expertise in software development, data analytics, cybersecurity and hardware integration. A skilled team or reliable partner is a must.
• Buy: Less in-house expertise is needed as the platform vendor provides ongoing support and updates.
• Hybrid: Although the base platform is provided by a vendor, customization and integration still require skilled workers to some degree. 

Investment

• Make: Requires significant upfront and ongoing investments, including hiring skilled employees, purchasing equipment and developing software.
• Buy: Lower initial costs, but ongoing expenses for licensing, support, and maintenance.
• Hybrid: The cost depends on the level of customization and support provided by the vendor, allowing for a good financial trade-off.

Security risks

• Make: May face significant cybersecurity challenges, so proper expertise is required. Robust security measures and continuous updates to protect against threats are crucial.
• Buy: The vendor handles security, but reliance on their protocols can be risky. It’s important to evaluate their security track record and response capabilities.
• Hybrid: Involves shared security responsibilities. Vendors secure the platform, while you manage data security and access controls. 

Scalability

• Make: Can scale with business growth if built on a robust architecture. However, maintaining reliability and availability requires ongoing investment.
• Buy: Designed for scalability, but a fixed architecture might limit flexibility.
• Hybrid: Customizations can scale alongside vendor updates. Growth can be handled efficiently, ensuring long-term viability.
  
  

Paper: Make vs Buy vs Hybrid

Each approach offers its own advantages and comes with challenges. By carefully assessing the 6 factors mentioned above, machine builders can choose the best approach for implementing their Industrial IoT platform.

Our paper “Make, Buy or Hybrid? 6 things to consider for machine builders implementing an Industrial IoT platform” gives you a detailed comparison of the 3 approaches mapped onto each of the 6 factors mentioned above.

It also includes several use cases from the machine building industry, and a set of questions to answer for yourself that can help you make a more balanced decision whether to choose the Buy, Make or Hybrid approach to implementing an Industrial IoT platform .