The cost of building software has significantly decreased, allowing more companies to create custom tools instead of relying on traditional SaaS solutions, which remain expensive and less tailored to specific needs. This shift is leading to a rise in shadow IT as employees bypass IT departments to build solutions quickly, highlighting the need for improved governance and oversight to manage security risks and ensure effective tool deployment.
The key insight for you is that the shift towards building custom software, fueled by AI-assisted development, is changing the dynamics of traditional SaaS procurement models. This presents an opportunity to consider deploying AI-driven custom solutions for internal tools, especially in areas like workflow automation and admin tools, where off-the-shelf options often fall short. However, the critical takeaway is to ensure that these developments occur within governed environments to manage security risks and maintain accountability, aligning with the broader trend of increasing AI regulation and safety concerns.