Tim Cook, CEO of Apple
Selecting software is more than just about the software and hardware. A vendor's service depth and breadth to support and enhance your needs long-term are just as important.
While two guys in a garage may be helpful when innovating to create a new industry or product, they are not the right choice when selecting critical software to run your business.
Vendor stability, capabilities, and market positioning are vital when choosing a software solution.
Decide on a vendor solution that includes:
I've engaged in 200+ RFP projects. Two primary observations include:
A software package, aka Commercial Off-the-Shelf Software or COTS, is a ready-made computer program or collection of related programs developed by a software vendor.
Tens of thousands of high-quality commercial software packages and services are available today.
A sound business process is critical to optimize your vendor partner decision regardless of the selection approach.
Consider buying, rather than custom developing, software for the following reasons:
Don't get lulled into a false sense of security. Buying software isn't a panacea, and it isn't for every organization and application.
Apply discretion when deciding what capabilities to enable using commercially available software.
Capabilities that differentiate your organization in the marketplace may require custom software.
Maintain awareness of the communication challenges between your organization and potential software vendors. Your organization doesn't understand how a vendor software system works, and the vendor doesn't understand how your business works. That's a significant gap to overcome.
Communicating via a Request for Proposal (RFP) with your procurement department as the intermediary further impedes communication quality and understanding.
During implementation, the realization surfaces that the software vendor selected can't support your essential needs, ultimately dooming or diminishing a successful business outcome.
Sometimes, organizations request too many desirable requirements, buying and paying for more than they need.
Focus your requirements on the vital few that enable your business case.
No, that isn't a misspelling. It represents when too much flexibility creates complexity.
Commercially available software is architected with powerful configuration capabilities.
Buying application software is essentially buying a business process. Don't buy if you're not willing to commit to the business process and associated integration you're buying.
Buying, implementing, and sustaining software is a significant and strategic organizational investment. Establish a strong partnership with your software vendor.
Adopt partnerial thinking to:
A vendor may promote using its software to satisfy a use case for which it wasn't explicitly developed. They will emphasize the "commonalities" and the "minor" changes required to enable the solution to satisfy your needs. Please don't believe it!
People bring all sorts of biases to the decision-making table. Prior experiences, favoritism, personalities, etc., can enter a decision process.
Minimize bias by establishing a rigorous and quantitative scoring methodology. Score and quantify vendor proposals and solutions to the extent possible.
Source your core evaluation team with objective and independent-thinking people.
Don't consider vendor software a solution if you're unwilling to entertain changing your business processes.
Viable vendor software solutions are highly configurable to meet most business process needs. However, you must be flexible and open-minded to change your business process to leverage vendor software solutions.
Vendor decisions are about more than selecting a vendor.
It's more than just about vendor capabilities. Does your organization have the requisite abilities to leverage what the vendor brings to the table?
That question leads to Capability Thinking®. At a minimum, your organization needs requisite skills, methods, and experience in the following areas to leverage the vendor relationship fully:
A vendor I'm familiar with uses the tagline "Complex things can be so easy ...."
That tagline also applies to the RFP process. Organizations make it more complicated by attempting to communicate using only paper and their Procurement team. Simplify the process by directly interacting, talking, and listening to each vendor: document crucial discussions, expectations, conclusions, and decisions.
Take inventory of your organization's current solution assets and partner relationships. Many organizations initiate a vendor selection process prematurely before considering other options.
Take stock of existing partner relationships first before considering new partner options in the following sequence:
Two different approaches for evaluating and selecting application software are:
The following grid provides an overview of an enhanced RFP approach for evaluating and selecting vendor software.
Critical call outs include:
In the age of the Internet, AI, and Social Networks, Request for Proposals are a waste of valuable time -- for the preparer as well as for the responder.
Avoid creating an RFP when possible. RFPs sap an organization's scarce resources and provide, at best, a marginal return.
Time is the scarcest of organizational resources. It can't be replenished.
Organizations prepare Request for Proposals (RFP) solicitations primarily for three reasons:
Here's the paradox.
Organizations with overly bureaucratic procurement policies that restrict discussion, communication, and discovery between business users and vendors during the RFP process further constrain knowledge flow.
So, considering the time and effort most RFPs require, where's the value? It's expensive, time-consuming, and results in less-than-optimal decisions.
Use an enhanced RFP approach to increase the effectiveness of your vendor evaluation and selection process.
Learn more about the enhanced RFP approach.
Modern-day Internet, AI, and social networks provide extensive knowledge of vendors and their solutions and customers.
Advanced searches using modern web browsers and sharing cooperative knowledge with vendor customers will provide you with a more thorough and accurate understanding than what you will receive in an RFP response. They require less time, are more efficient, and result in better decisions.
Vendors save time and money as well, which they can reinvest in their customer relationships, people, and products.
Capability Thinking® provides guidance that leverages the Internet, AI, and peer organization networks to replace "RF" undertakings.
RF activities include:
Here's a modern, agile approach to evaluating and selecting vendor software.
Learn more about the JITDE™ approach.
The map below highlights the critical steps in each approach.
Legend: Blue denotes common steps in both approaches; Gray denotes RFP-specific steps; Teal denotes JITDE™-specific steps.