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I work in Germany in the private sector, medium size: 2000-5000 employees. I work in an IT Department.

Short Version:

  • Boss asked to buy software for team, that i built on my own time
  • I didn't build it with any intention to sell it to my Company and it is not written for the specific Needs of my company
  • I responded that I feel honored but have concerns regarding compliance
  • We have a team which deals with compliance

Possible solution:

  • A friend mentioned that its not a regulatory issue, but only company internal, so a subjective view that can be decided internally
  • potential issue could be that Budget is used for private gain without benefit for the company
    • we could show an overview of potential software on the market and show why mine is better for the company to the compliance team

Question:

Does anyone have additional ideas for the section "Possible solution" or (optimally) was in a similar situation?

Background:

For some Tasks we use software we buy from external firms. It is not my focus of work, but I saw that a colleague is using a software that is pretty expensive and seemed not really well written. I was curious if it is really badly written and if one can do better. So I worked for around 3/4 year in my private time and built a tool myself.

Last week my boss told me about a bottleneck/problem they have with the software and that they struggle for weeks to reach the desired results. I told him I could have a look and showed him a way how to reach the desired results a few hours later. He was impressed and I showed him how I came up with the solution (including my tool).

Next meeting he asked me if he can buy the tool somehow. I said, I feel really honored, but I am not sure, because of potential compliance issues.

  • 4
    Does your company have a legal department? Maybe you and/or your boss ought to talk to them. – nick012000 Sep 26 at 22:51
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    What exactly is the issue you are trying to solve? Do you want to sell the software, but you're unsure if it is alright to do so? Are you looking for general advice on whether to sell or not? – TheSoundDefense Sep 26 at 23:01
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    Fair Point, thank you. I am open to sell, but would like to better understand the risks and drawbacks. Its more important to me to fulfill compliance rules than making Money, also i dont want to do sthg in the "Grey area" which can later be used against me. --> "Do you want to sell the software, but you're unsure if it is alright to do so?" Yes. "Are you looking for general advice on whether to sell or not?" In case you have thoughts About that, i am also interested of Course! – ThanksGuys Sep 26 at 23:06
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    The biggest issue I would think is who is responsible for maintaining the software that you have developed once it is purchased. You could go for a licensing model, one time purchase, etc etc. But as the developer of said software, any issues or feature improvements will probably make its way back to you. Then you have to figure out when would be appropriate to work on said software. – Shadowzee Sep 27 at 0:44
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    Is your boss proposing buying paying to use your software, or paying to purchase the rights to the software? The latter would be much simpler, so you would not be responsible for maintaining it, and the software could continue to be developed on company time. – David K Sep 27 at 12:19
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Here are some potential issues you can think of:

  1. Is the ownership of the software clear? Can the manager / company claim at a later date that the tool was developed with company resources etc, and so the company is anyway the rightful owner of it? From your description, it doesn't look like the manager is coming from this direction, but Legal/Finance definitely can.

  2. What are the numbers involved? Are they significantly larger than your annual pay, or a fraction of it? Is it a significant amount for the company? Depending on how large or small the numbers are, this will attract different kind of attention from others involved in the whole process.

  3. Is there a precedent within your company where someone did it before? It is much easier to overcome internal inertia when there is an example for a similar situation for the other folks to follow.

  4. What are the post-sale expectation once you sell the software? As pointed in comments, think if the company expect you to work on issues in it, on your own time later, or it is being sold as is.

  • It might be useful if you would also provide some possible answers / examples to your questions. It is not obvious for the untrained eye what you mean... E.g., what does "post-sales expectation" mean? I happen to understand, but OP asked his question for a reason. – virolino Sep 27 at 13:21
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Does anyone have additional ideas for the section "Possible solution" or (optimally) was in a similar Situation?

Yes. You REALLY need a written contract for this type of thing. Any details that need to be worked out: payments, support, access to source code, bug fixing, liability, rights to distribute, IP, etc. need to be written down and agreed on by both parties. Than the contract needs to be reviewed by the company's HR team and legal teams to make sure it's fully in compliance with any policy or legal requirement. Depending on the complexity and the amount of money involved, you can consider having your own lawyer look it over.

It if's all good, then you can sign and everyone just does what's written in the contract.

It is VERY important to work through all contingencies & potential conflicts BEFORE agreeing to something like this. It's easy to make reasonable rules when you are all still friends, it's a lot harder to do this in a conflict situation.

  • +1 for how important such a written contract is. Some important points: Are they buying a license to use the software, or will the software & source code essentially become their property? Is the software provided as-is or will they expect you to fix any bugs? How quickly will they expect bugs/security vulnerabilities to be fixed? Are you expected to fix bugs in your software on company time? If yes, does it remain solely your software? – fgysin reinstate Monica Oct 2 at 12:59
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On top of the previous answer, please consider that this smells of "Conflict of Interest" which is probably why you're (correctly) pointing it as a potential compliance issue.

Since you'll be acting as a supplier to your employer and the person with the decision-making power has what can be considered a close relationship with you, this situation can be interpreted as a conflict of interest because of the following factors:

  • You're directly benefitting from a company decision to invest in efficiency
  • Your boss' decision to buy your software might be interpreted as favoritism
  • Your boss buying your software - especially if there were no "due diligence" or a neutral party involved - might be interpreted as collusion

Depending on the company and how active and strict the controls are, this can get very ugly very quickly (I come from Latin America, which is regarded as a hotspot for fraud, so bear with my paranoia a little). As a suggestion, I'd advise the following:

  • Standard COI countermeasure: disclose it as soon as possible to a neutral party so it gets documented and the appropriate measures are taken. Usually the chain is your manager, then more specialized functions like HR, Legal or Finance, and then a specialized Compliance team (if you have it)
  • If you have a Purchases, Procurement or similar department in your company, advise your manager to get them involved as soon as possible. It is their job to find the best possible supplier and do due diligence on why that's the best possible supplier including payment conditions and technical review of the code by a neutral party.

Pretty Wikipedia Link for further reading on conflict of interest.

  • Your boss buying your software or Your boss' decision to buy your software: neither of these are true in a company of that size. The decisions are made by specialized departments, according to some established processes. Things can get nasty if handled improperly, but the boss buys nothing and decides nothing. – virolino Sep 27 at 13:24

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