Business decisions so often come down to a cost-benefit analysis: what will I get for what I spend, and when will I earn back what I am investing?

But there’s more to evaluating cost than simply ‘dollars in, dollars out.’

Consider the cost of making the wrong decision for the right reason.

You try and save a few dollars here, adapt an existing tool for a new use case there, and find a way to come in under budget for the year. You’ve saved the money that might have otherwise been spent on a new tool, saved the cost of having to train your team how to use new software, and business can continue as normal.

Until it doesn’t, of course.

The cost of failure

When things go wrong, you quickly realize that the true cost of software needs to include the costs of failure.

These are the bills that come due when your ‘just OK’ software tool fails, the costs that mount up when you miss an opportunity or waste time supporting out-of-date methods, and the price you pay when the policies and procedures you put in place to support a bootstrapped approach to compliance or regulation fall victim to human forgetfulness.

No one wants to feel like they’re overpaying for something and this sometimes makes it hard to commit to buying expensive software from the get-go. However, when options are assessed in terms of long-term quality and risk mitigation versus instead of just short-term accounting expenses it’s not unusual to find the more expensive option is actually more cost effective in the long run.

As my mother drilled into me when I furnished my first apartment, “buy well and buy once.”

The hidden expense of a cheap CRM

When it comes to essential business software there is one tool that is up there with the office suite and email client for its positive impact on productivity: the customer relationship manager, or CRM.

A good CRM fundamentally changes the way a company works and drives operational efficiency right across the organization. Adopting quality CRM software correlates strongly with increased efficiency, higher sales, and, indeed, profits. CRM tools empower customer-facing employees to have better interactions with clients thanks to better management of client data. CRMs provide the reporting and analysis businesses need to make more accurate and efficient decisions, while centralizing important information improves communication and alignment across departments and divisions.

Despite all the advantages that stem from these dedicated software solutions, however, some life science companies continue to persist with generic or consumer-grade solutions that aren’t tailored to the specific challenges of their industry. As a result, these companies often cobble together multiple tools and struggle to harmonize their activities and workflows.

What’s more, because their information is scattered across tools it becomes a serious challenge to provide a concise, unified overview of their activities. Companies can find themselves missing crucial CDA deadlines because their legal team’s software system isn’t fully integrated with another department’s partnering project.

The costs that flow from persisting with a cheap, bootstrapped, or consumer grade CRM can be enormous and quickly amount to more than the price of a dedicated life-science specific CRM subscription. While the sticker price of a dedicated life-science CRM might cause you to pause, it’s almost always a better investment in the long-term when the costs of failure of a cheaper generic solution are accounted for.

An in-house alternative?

For some life science companies the search for a industry-specific CRM takes them not to the marketplace but to their internal development teams.

After all, they reason, who knows our industry and needs as well as our own people, and aren’t we already paying the salaries of the developers, anyway?

Unfortunately, though, these efforts have some long-term costs that overwhelm any short-term savings made by keeping the software build in-house. The additional resources needed to modify a CRM on a regular basis can not always guarantee the results you hope for. The ongoing and over-customization is a hidden cost that many businesses do not account for. As Frederic Scaerou, a Senior Director at Ipsen, told Inpart, “Designing your own solution is really painful. What you think you need, isn’t necessarily what works in reality.”

Oftentimes these in-house alternatives fail to live up to expectations and after expending much effort and even more cash, companies turn to software vendors with experience in the industry and best-in-class CRM tools.

As Scaerou would say of our own solution, “Inpart’s platform comes with business development best practices built-in, making it easy to adopt and use. Inpart is truly designed for business developers, which is why so many biopharma companies use it."

Assessing all the costs of your software choices

Every business decision demands weighing the outcomes of alternatives and seeking out the greatest value for the investment made. When it comes to choosing the CRM for your life science company, however, it’s important to include the cost of failure. To fully assess the return on your investment, you must think ahead and account for the true costs of time, risk, and opportunity.