Build vs. Buy – the Pros and Cons for Association Data Analytics

Posted by Rob Miller on Oct 8, 2019 2:47:04 PM

Inefficient as it sounds today, it was not uncommon in the 1990’s to hear that an association was going to build their own Association Management System (AMS) rather than purchase an existing one.  When we heard that, we’d generally put a reminder in our sales tracking system to contact them again in 18 months. By then, most would have spent a lot of money, failed to achieve the goals established by the organization, and lost some or all the technical staff who were working on the project.  For those who persevered and were mildly successful, they were still challenged with retaining their key technical talent and keeping the system up to date. By the mid-2000s, you seldom heard of an association taking this approach.

Unfortunately, we are seeing the same cycle repeat itself again, this time with data analytics.  Some associations are trying to cobble together various technology tools, hire a data analyst, and attempt to build a series of data visualizations in hopes of supporting their organization’s needs. They don’t realize how much effort this requires – buying a general-purpose analytics tool such as Tableau or Microsoft BI and then taking on everything required to link it to all your different sources of member data, pull in the data and make it usable, then conceptualize and create data visualizations that meet the needs of all your different departments and initiatives, which is tantamount to building data analytics from scratch.  If that was a headache to read, think about how much of a headache it would be to actually do it - yikes! The build vs buy conundrum lives on.  

While the desire to create and implement a data analytics solution is commendable and a definite step in the right direction, building it on your own is time-consuming, difficult, and requires manpower to keep it running and useful. As a result, we are already seeing some of these associations that have attempted to build their own returning to us for help.  The same arguments against building your own AMS apply to data analytics:

  • Time to market – can you afford to wait?
  • Opportunity cost – what could those additional resources be focused on?
  • On-going maintenance & support investment – do you really have the skills and resources to provide on-going support?
  • Ease of Use – do you have the skills to build something that your organization will use and trust?
  • Losing critical technical staff – what happens when you lose critical staff?

A justifiable reason to build custom software is that no software developed by someone else could meet your needs.  As it relates to data analytics, that might have been true 3-4 years ago, but that is no longer true today. State-of-the-art tools like Nucleus now offer the best of both worlds – immediate value and flexibility to support future needs. Nucleus offers:

Immediate Value:

  • Pre-built integrations to the industry’s most popular technology solutions (your AMS, events software, email marketing, learning management systems, Google Analytics, etc.)
  • A comprehensive baseline of pre-built visualizations representing each major component of an association’s business (membership, marketing, conferences, certifications, government relations, etc.) 

Flexibility:

  • Pre-built data connectors for Tableau and Microsoft BI that enable IT staff to create one-off visualizations to work in conjunction with our baseline visualizations
  • A comprehensive application programming interface (API) for any and all other desired integrations

New clients typically derive tremendous benefit from starting with our extensive pre-built baseline of visualizations that have been co-developed with input of our current clients and member-industry thought leaders.  Seeing how others use data visualizations often saves time and sparks new ideas!

Nucleus has been built with the input of a great many associations to ensure that it embraces and delivers the best insights from the industry. It also includes the ability to embed analytics (read our member-facing analytics blog) so that your members can each be served personalized, individual analytics when they log into your site or use your mobile app.

Apart from the level of effort required to reproduce the thousands of hours that has gone into developing an association-specific data analytics platform like Nucleus, there is also a completely unrelated, yet critical, reason not to build your own data analytics solution (or any data solution these days) – the data privacy and security risks.  Associations manage a great deal of data on behalf of their members and they are trusted to protect it. There is a growing list of regulations, such as GDPR and the California Consumer Privacy Act (CCPA), with punitive penalties that will severely punish an organization for mishandling personal data. We certainly did not have the specialized security software skills at my prior association to guarantee that we could be good stewards of the data – especially given the fact that new privacy regulations are being considered by many other states and nations. This article lists 11 new state-level privacy and security laws.  Like most, we opted to select trusted partners for our AMS and e-marketing to support our operations and protect our data.  We made the same sensible decision for data analytics.

A tremendous advantage to implementing an industry-specific application, especially if it is a Software-as-a-Service solution, is that your organization continues to receive all the R&D investment that your vendor adds to the solution - often including great innovations requested (and sometimes funded) by other clients.  This cannot be understated as it relates to data analytics and the unique needs of associations. Benefitting from the ongoing innovations of an association-specific data analytics software company - and their entire community of users - is invaluable. If you go it alone and build your own solution, you are limited to internal ideas and resources.

We applaud you.  You are moving in the right direction. You understand that unlocking data insights about your members will allow you to better understand them, serve them, and make better business decisions.  But a decision to buy rather than build will put your organization on a successful and sustainable long-term data strategy. One that can grow and change as your business grows and changes.

Topics: Data Analytics

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