Steps to software selection

Purchasing software can mean making big decisions. Depending on the type of system you are seeking, a multitude of products may seem legitimate at first glance, but it pays to evaluate with a critical eye.

Of course it is important to find the best solution, but identifying the right vendor can be easier said than done. There are many avenues to explore including web searches, association references and peer recommendations. While it may seem counterintuitive, starting with a broader set of options may actually help you narrow your search more quickly. It’s possible that you’ll identify elements you absolutely don’t want during a cursory review, which will help you identify the elements that are most important.

It’s as much about the provider as it is about the product, and asking the right questions will provide quality information, enabling you to maximise the chance of successful selection and implementation. Try the following as a starting point.

Functionality and technology fit

• Can the vendor handle your functional requirements?
• What industry-specific requirements will be necessary in the future? Can the vendor provide these now, or do they have a future path?
• What third-party add-ons may be necessary?
• What strategic advantages will the software provide?
• What enhancements will be necessary to make it work with your company?
• Will these enhancements take you off the upgrade path?
• Can you leverage current systems and hardware?
• Is your current technology outdated?
• Is your IT group proficient in the offered technologies?
• Can you retrain staff or will you need to hire new skillsets?
• What development tools were used to write the software?
• Will you be able to easily customise?
• Can it be easily integrated with other systems?
• Does the software employ open application program interfaces (APIs)?

Software vendor relationship

• How much information do you have on the vendor: size, employee numbers, locations, completed projects?
• What are their future plans?
• Is it easy to communicate with the vendor and do you feel the cultures match?
• Will they be a good long-term partner?

Implementation and ongoing service

• What do you know about the value-added reseller (VAR) — size, experience, support ability?
• Maintenance — how will the post-implementation maintenance and billing be handled?
• Support — what are the telephone support hours, is there a callback guarantee and what geographic region is covered?
• Training — is there a training offering?

Collecting information

The right software will not only provide a basic functional fit, it will also give you a strategic advantage and drive operational efficiency, so the information collected to make the choice should be relevant.

The ability to gather relevant information is directly correlated to asking the right questions. For example, don’t ask “does this software provide business intelligence and reporting?”, but rather, “As a senior manager, I need to stay up to date on project status, view order requests and approvals and review billing information. Is this available from a single source, which I can share with different colleagues, providing different access levels based on their role?” This is likely to provide a vastly different answer, so it pays to be specific.

Narrowing the field

Once you've narrowed it down to a shortlist, it’s time to check references. While they can be a valuable tool, it’s important to understand the true worth of a recommendation. Above all, a good reference will validate that your implementation is possible within the time and cost identified by the vendor. Equally, you shouldn’t make decisions based solely on reference recommendations and should have an understanding of the underlying technology. While your provider doesn’t have to be at the bleeding edge of technology, they should be working with something that is both flexible and scalable, ensuring it will not date as you continue to grow.

Integration

Be aware — ‘integration’ is considered the most overused term and underdelivered aspect of software purchases. Passing an invoice amount to an accounts receivable module in a financial application may be considered integration, but is it? True integration actually creates the invoice, records the receivable transaction and all the data that goes with it, allowing users to see each step of the process in detail. True integtation means all processes are woven into the product, not just exchanged between modules. Third-party certification from other vendors usually guarantees that the product’s code has been tested and performs as promised.

Show me the money

The demo phase is when the rubber hits the road, but it’s also a time to ask the vendor to work for your business. Insist on having the demo work with your data, not a test case, and be sure to test specific functions that are integral to your business. Have all members of your selection committee in attendance and make sure that every question is answered there and then.

Making the commitment

There are three things you’ll need to manage here: budget, personnel and expectations, and you need to be realistic about all three.

Budget

When establishing your budget, be realistic. If you are embarking on an enterprise-wide solution, it’s not unheard of to allocate 1-1.5% of revenue for the past three years (provided revenues reflect a typical year). The figure goes up to around 3% including purchase plus implementation. Factor in everything including: software and database licences, hardware, implementation, training, maintenance and other internal costs.

Personnel

This is critical. If you outsource a consultant, be sure they know the game and can bring best practice knowledge with them, rather than sourcing a solution that works with what they know.

If you keep the selection process internal, make sure that committee members understand all aspects of the business. Selectors should interact with the system daily and represent varied parts of the business including operations, finance, service and project management.

Expectations

It is important to be realistic about how and when the system will operate. The selection committee should conduct a needs assessment and get feedback from different functional areas. It will provide a good foundation and avoid pain during implementation. The system probably won’t perform 100% out of the box, so choose top areas and list critical points under each.

Large-scale software purchases can bring huge benefit to organisations, but only if the selection and implementation process is well planned. Remember to evaluate the vendor, as well as the functionality, and regard the end product as a key component of your organisation. The right decisions now should deliver well into the future.

Image credit: © iStockphoto.com/Mauro Saivezzo