<p class='large'>Companies spend <a href='https://www.gartner.com/en/newsroom/press-releases/2021-10-20-gartner-forecasts-worldwide-it-spending-to-exceed-4-trillion-in-2022' target='_blank' rel='noopener noreferrer'>4.5 trillion dollars</a>—that’s trillion with a T—on IT each year, with internal tools taking up an increasing slice of the pie. Maybe that’s no surprise: businesses run on a lot of manual processes, and manual processes can often be made more efficient with the right internal tooling.</p>
In order to run faster and reduce the manual effort, many companies build things like admin panels, dashboards, and custom tools on top of their databases, SaaS tools, and CRMs. The way that building is done varies from company to company—and sometimes even team to team.
Over the last few years, we've been surveying engineers and operators to dig into the details of how they design, build, maintain, and evaluate the performance of their internal tools. This year, we surveyed over 2,200 people (more than half developers and engineering leaders)—and given the macroeconomic climate, we were especially interested in how their processes, priorities, or technologies have changed.
Let’s explore the state of internal tools in 2023—and how that state is evolving.
How are companies building their internal tools? What languages, libraries, and resources are the most widespread? Has anything major shifted? Largely, last year’s popular technologies seem just about as popular as ever.
React is extremely popular for building apps and SaaS products, so it makes sense that some teams streamline their stack(s): just over half of respondents that use custom-built internal tools also use React for those frontends. This is a slight dip from last year, which saw React at ~57%, but the popularity of other top web frameworks was fairly consistent. jQuery is up slightly from last year’s score (21% v. 25%); Angular (13%) and Vue.js (12%) were within 1% of 2022’s scores.
Given this was a Retool survey, it makes sense that Retool is well represented here: ~65% of respondents that use third-party platforms to build internal tools and business software use Retool. The next leading vendor was Zapier (36%) followed by Airtable (32%) and Google AppSheet (26%).
Some companies use extendable admin libraries to build internal tools (18%). Among them, Python-based Django admin (50%) was the most popular by a wide margin (and only marginally lower than last year’s 51%). Active admin (34%) and Rails admin (25%) are the runners-up.
Sometimes, you just need a known-known way to build and manage something without committing major dev resources. So it goes that almost half of respondents use spreadsheets to manage at least one internal process. Amongst respondents, Google Sheets reigned supreme for the internal tools use case (81% versus 49% for Excel).
Just like last year, Tableau led the pack at 39%. Microsoft Power BI crept up from 27 to 33%, and Google Data Studio—at 25% last year—hit 31%.
Notably, respondents were pretty satisfied (~75% or more) with most individual elements of their stacks. BI/visualization tools were the exception: nearly half of respondents don’t enjoy building with their current BI/visualization tools, and only half said they planned to keep building internal tools with them. Could it be due to the lack of workflow automation? Other technical constraints? We think so—but you tell us.
The data sources used for internal tools saw, perhaps, a little consolidation: internal databases stayed in first place (78%, down slightly from 82% in 2022), followed by internal APIs like REST and gRPC (56%, down from 63%), and third-party APIs (45%, up slightly from 44%). And getting a little more granular, there was a little moving and shaking amongst the top DBs and APIs, as you’ll see here...:
|Top internal databases used for internal tools||2022||2023|
|MS SQL Server|
Postgres remains the clear leader. But with companies increasingly investing in internal tools—and under extra pressure to do more with less, and sometimes in less time—its relative slowness with simple workflows may make it a little less appealing. Many other options—like Firebase, Elasticsearch, and Redshift—were within decimal points of last year’s numbers. One interesting call out: usage of the open-source MySQL database MariaDB doubled over last year (10%, up from 5%), with most growth concentrated among companies under 500 employees.
|Top third-party APIs used for internal tools||2022||2023|
This year, we also included AWS (31%) which was second only to GitHub. For other popular options, Twilio (19 versus 13%) and Airtable (19 versus 15%) dropped a bit while others like Google Ads, Facebook Ads, HubSpot, and Zendesk were within a couple percent of where they were last year.
How much engineering time can you dedicate to building internal tools? What’s the right balance between building from scratch and buying? Companies are keeping these questions in mind as they adapt to the current macroeconomic climate.
This is part of an ongoing trend—every year, the time spent on internal tools is going up. In previous years this was most noteworthy among larger companies. This year, companies of all sizes are spending more time on internal tools, from single-person shops to massive organizations with over 5,000 employees. The trend is especially true for companies in Data and Analytics, Consulting, Financial Services or Insurance, and Energy or Utilities sectors (all at 89–90%).
Across all company sizes surveyed, a majority of respondents (86%) believe that this investment in internal tools will increase or hold steady over the next 12 months.
In previous years, most teams relied on in-house development to build that internal tooling. Today, home-grown apps still hold a loose majority (55%), but nearly 65% of respondents also use something else—spreadsheets (48%), various flavors of business process tools (35%), and BI/visualization tools (27%) among them.
In short, the build/buy dichotomy seems to be fading—and developer tools that make building internal apps and tooling more efficient and scalable are gaining ground.
Not necessarily. But too many SaaS tools that do most of the job—and that aren’t quite integrated with each other—can mean lost time, excess context-switching, and diminished productivity.
On average, a little over 22% of respondents blamed poor productivity on excessive context switching between tools—and at some enterprise companies (over 5,000 employees) that spiked to over 33%. It was also a particular challenge for respondents in Security roles (37%).
This matters! An extra hour a week of tab switching may not seem like much, but multiply that by 100 different processes across departments... Or try imagining a robust security organization attempting to mitigate risk across dozens of disparate tools. It can have a material impact on a company’s bottom line.
But even getting more granular, things still skew consolidate. Only respondents working on solo projects (4%) or at companies in the 500–999 range (.69%) had a slight preference for more software.
Companies may purchase SaaS tools to solve niche challenges, but sometimes having more tools creates new problems as workflows get split between products that don’t talk to each other. These are fixable challenges, and custom internal tools (paired with smart integrations across fewer “systems of record”) can help alleviate this.
While respondents might have been a bit down on buying more SaaS overall, they still want the right tools to get things done. Highlights include a preference for Retool (we’re honored!), spreadsheet software like Airtable, and tools like Zapier. (About a third of respondents also expect to see more investment in productivity software like Linear and Asana as well.)
And they largely said their productivity was on the up: over 70% of respondents have felt more productive in the last 12 months. (Another 20% reported no change.)
Respondents that used a platform for building business process software were 20.5% more likely to feel a productivity boost in the past year over those who didn’t.
Of course, even business and technical leaders, eng teams, and developers that want to invest in internal tools can face some challenges in doing so. As was the case in previous years, time, resources, and access controls (the latter especially at companies above 5,000) remain the biggest blockers to building and maintaining internal tools.
With an overall uptick in time spent on internal tools, though, a lot of companies are clearly finding their way around at least some of the obstacles. There’s no one-size-fits-all fix for getting buy-in and making it happen, but knowing (and demonstrating) the value of internal tools—and being able to deliver on them efficiently—can help. What are some fast, scalable ways to accomplish what you need to, while managing security and risk? What impact could that investment in your internal tools have on the business? How will you measure success? … Let’s talk about that last bit.
If your team is spending their time building internal tools, you want to know for sure that it’s all worth it, right? Here’s how respondents say their organizations measure the success of the internal tools they use.
This is down slightly from last year, where it came in at 60%. The emphasis on productivity as a measure of success was highest from respondents who work at companies in the Retail or E-Commerce (67%), Real Estate (67%), and Security (67%) sectors.
This is up rather sizably from its ~25% last year. And we noticed that the larger the company, the more likely it is to lean on employee adoption as a key benchmark.
This is also up over last year, where it ticked in around 25%.
Productivity is, reasonably, a major factor here, but internal tools can do more than just help teams get things done. The impact on the bottom line also plays a role: think, reduced software costs (30%), increased company revenue (25%), and lower headcount needs (21%).
Still, some respondents said their companies don’t measure the efficacy of their internal tools at all. If you’re looking for some things to measure, may this section inspire you.
Even beyond this survey, the industry headwinds facing tech companies and the larger macroeconomic environment are encouraging many organizations to do more with less. And perhaps that’s contributed to an emphasis on making processes smoother and getting the most out of your existing SaaS (and beyond). Companies are investing more time than ever in internal tools that can accomplish just that, and respondents both expect and want to see that investment continue.
But teams aren’t building those tools quite the way they used to. While custom code and top frameworks like React are still very much in use, teams are increasingly tapping into platforms that make building custom internal tools more efficient. As we look to the future, we expect to see teams seek more and more ways to reduce SaaS sprawl, maintain secure data access, and preserve developers’ work time.
And let’s not forget the potential of AI. With the development of powerful LLMs and the rapid evolution of widely accessible AI technologies, we think it’s going to be a major player in the development of intuitive internal tooling experiences—perhaps even more so than in customer-facing features.
What’s your take on the state of internal tools in 2023? Tell us all about it.
The insights in this report were gathered from a survey of 2,276 developers and technical leaders in March 2023. Here’s a breakdown of respondents by industry, location, and role.