Open Source Software: Calculating Economics and Sourcing Strategic Considerations
In this article, we highlight a number of areas that should be included in sourcing strategy considerations if open source software is being considered as an alternative to traditional proprietary software. Including the components that make up the overall economy, scenarios for open source, and necessary management activities.
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Many organizations and companies have experienced a significant increase in their software costs in recent years. This is due, among other things, to a number of changes in suppliers’ market strategies, where new licensing paradigms, delivery methods, changed user terms and conditions and continued consolidation in the software market have created the basis for significant price increases. As a result, we are now seeing software customers – large and small – considering alternatives to their current software portfolios. Among these, the use of open source software (OSS) is an option that we see being explored.
The interest in OSS is mainly due to the potential to reduce the company’s total costs, but also because it can lead to greater freedom and control over a number of technical and strategic aspects of the company’s IT support.
As with all other sourcing strategy decisions, it is important to involve all relevant stakeholders in the decision-making process regarding the use of OSS. This involvement includes, among other things, making everyone aware of the financial, business and organizational consequences of investing in the use of open source software as an alternative to proprietary software.
As input to this, in this article we will provide answers to a number of questions that are important to answer in this context.
