eGain: Building Own Knowledge Management System Proves More Costly Than Buying

Hidden Costs of Building a Knowledge Management System Revealed

eGain Corporation has released an analysis comparing the costs associated with building an in-house knowledge management system (KMS) versus purchasing a commercial platform. The report concludes that internal build projects frequently become considerably more expensive than acquiring a ready-made solution, primarily due to unforeseen expenses.

Organizations opting to construct their own KMS often find themselves needing to rebuild the system. The initial build is for launch, followed by a second phase to adapt it for scalability, security, and regulatory compliance. These rework efforts necessitate substantial additional investment and resource allocation, diverting focus from core business objectives.

The analysis emphasizes that developing a proprietary system demands sustained engineering effort over many months, delaying the creation of features that drive business competitiveness. Furthermore, a five-year budget projection must account for the costs of security, AI capabilities, scalability, and integrations.

Build vs. Buy Cost Comparison (3–5 Year Horizon):

• Initial Development: High cost for in-house builds, lower for commercial acquisition.
• Security & Compliance: Ongoing internal burden for proprietary systems, vendor-managed for purchased solutions.
• AI Capabilities: Requires specialized talent for internal builds, continuously improved by vendors for commercial platforms.
• Scalability: Necessitates re-architecture for internal systems, elastic by design for commercial solutions.
• Integrations: Engineering overhead for proprietary builds, pre-built connectors for purchased options.

The report highlights a case study of a large U.S. bank that consolidated onto a single platform, significantly improving user support and deployment speed.