In the high-stakes world of financial services, technology decisions aren’t just strategic—they’re existential. Whether managing risk, delivering digital-first client experiences, or modernizing legacy infrastructure, financial institutions are constantly faced with a fundamental question: should we build custom software, buy an off-the-shelf solution, or create a mix of both?
Analysts from Gartner recently introduced a model that challenges the traditional build vs. buy debate. Instead of choosing one over the other, they recommend a blended strategy—particularly impactful in the finance sector: “Buy where you can, build where it differentiates, and integrate everything for speed, scale, and compliance.” Download the full Gartner Build vs. Buy report to explore the full framework and insights from Gartner analysts.
Why This Matters in Financial Services
The pressure on banks, insurers, asset managers, and financial technology companies has never been greater. Institutions must navigate evolving regulatory frameworks, rising customer expectations, cybersecurity threats, and growing competition—from both traditional players and digital disruptors.
The problem? Relying solely on commercial solutions may sacrifice agility, while over-investing in custom development can drain resources and delay time-to-market. In finance, where precision, compliance, and scalability are critical, the middle path—blending—often offers the best of both worlds.
Buy, Build, and Blend Model from Gartner
The Gartner model offers a practical, risk-aware framework for financial institutions looking to modernize their application strategy:
- Buy what you can: Off-the-shelf platforms are ideal for standardized processes such as general ledger, HR/payroll, KYC onboarding, or regulatory reporting. These functions are mature, heavily regulated, and better handled through proven, industry-compliant platforms. Gartner estimates that 60–75% of enterprise needs in financial services can be met through commercial software.
- Build what you must: Competitive advantage in finance often lies in proprietary trading models, personalized wealth management portals, or custom underwriting engines. These capabilities warrant in-house or co-developed solutions using low-code, pro-code, or AI frameworks. This should represent around 10–15% of your application landscape.
- Blend for cohesion and compliance: Integration is not optional—especially in a sector governed by strict audit trails, data privacy laws (like GDPR and CCPA), and real-time reporting. Gartner recommends allocating another 10–15% of effort to “blending”—integrating systems and ensuring data consistency, workflow continuity, and auditability across the organization.
Why Blending is a Strategic Imperative
In financial services, integration isn’t just a technical concern—it’s a business enabler. A seamless tech stack allows institutions to:
- Provide real-time financial insights across asset classes and business units
- Automate regulatory compliance reporting with traceable data flows
- Deliver hyper-personalized customer experiences in digital banking
- Enable AI-driven fraud detection and decision automation
Blending commercial and custom solutions ensures that institutions can innovate without losing operational control or risking compliance gaps.
One Simple Principle
To guide enterprise technology decisions without overcomplicating governance, Gartner recommends a deceptively simple yet powerful rule:
“Buy what you can. Build what you must. Blend both to deliver value.”
It’s an approach that resonates with many financial CIOs, who are under pressure to modernize infrastructure without disrupting service or breaching compliance mandates. In this industry, innovation must be smart, secure, and strategically timed.
Final Thoughts: In Finance, Flexibility Wins
The financial services sector is entering a new era—one defined by API ecosystems, embedded finance, real-time settlements, and customer-first digital platforms. The institutions that will lead are those that can act with flexibility: adopting proven tools when possible, developing differentiating tech when needed, and integrating everything to move fast without breaking things.
In the end, it’s not just about building or buying systems. It’s about architecting a technology foundation that’s agile enough to adapt, compliant enough to scale, and powerful enough to lead.
Download the full Gartner report “Build vs. Buy Strategy: Top Principles for Enterprise Applications” here.
