Recently TSI worked with a client who is going through a period of tremendous growth who asked us to look at their current ERP platform, and make a determination whether their current solution will meet their long-term needs. During our project, a frequent question I was asked by the client staff was (or something very similar) “What new software are we going with?” This struck me as odd because after doing several evaluations, I know there is a process and methodology to follow when performing a software evaluation. However, what became clear is that most people in an organization have limited or no experience picking the right software for their organization.
When posed this question, there are some common analogies we like to use. The analogy that seems to resonate the most is to think about buying a home. I recently went through this process, and life would have been a whole lot easier at the time if I knew out of the gate which house I was going to buy. We all know that this is not how it works. When evaluating the houses during this process, my wife and I evaluated several things, including the functionality, structural stability (from what we could see), cleanliness and look (curb appeal) of that home.
We did end up putting in an offer for a house, and like most wise homebuyers, we brought in a home inspector to evaluate the house itself. It turns out that it was good that we did because of a rotting foundation, significant problems with the roof that needed to be repaired right away, as well as a raccoon infestation that would not be easy to resolve. Needless to say, we did not purchase that home, but through our diligence, we did find the right home. Not only does our new home check all of the boxes on our “requirements” list, it does not have a family of raccoons living in the attic!
The same can be said of doing a software evaluation for your organization. Over the years, I have developed three key things to remember about the process of evaluating software:
- There are many options out there, not just the one everyone talks about.
Just because everyone talks about the same 2-3 software vendors (SAP, Oracle, Microsoft for ERP), this does not mean that they are going to be the right one for your company. Granted these software vendors have a very good product, but each have their own strengths and weaknesses. Additionally, there are now hundreds of ERP software vendors, many offering cloud based solutions to choose from, each with their own strengths and weaknesses, which brings me to my second point.
- There is a process – Follow it.
How do you possibly find the right one while there are so many options to choose from? Follow the process. TSI uses a proprietary four-step software evaluation approach to understand the need, define the future state, develop requirements and the RFP and finally run the finalists through vendor demonstrations. Key to this is to understand how your company needs and wants your business processes to run, not to be confused with how they are performed today. A common failure of any software evaluation (which leads to implementation failure) is not developing the future state process that will inform the vendors and you how the technology you are evaluating will get you there. Technology is not the panacea to all pains, but a tool to utilize in conjunction with process and organizational policies that will make it work. Lazy or uninformed evaluations will invariably bring unexpected and at times heavy costs/risks to you and your organization, which brings us to our final point.
- Do the work, put data behind the decision.
The decision you will be making as to which software will take you into the next 8-10 years is a big one. Even worse, an uninformed decision will likely cost you millions of dollars in implementation costs, likely cause you software adoption problems, interrupt the business and customers and may even cost you your job. To ensure you have made the best decision possible, and are able to defend it, put the work in, and get the data. Likely, your organization is complex, with some unique needs from a software system. Your unique needs for a software system will reveal (if used correctly) which strengths and weaknesses are of significant consideration. To get all of the information necessary will require an investment in time and resources from your organization.
One way TSI has used data to help inform the buying decision is to use the trusty radar chart. Here is an example where we used the vendor evaluation scores from the company SMEs (Subject Matter Experts) to score two different software vendors for fit. As you can see, each of the spokes (or functional areas) have varying degrees of fit. It is then up to the organization to decide which of these spokes have a greater priority, and which need to have additional evaluation to bridge the functional gaps. 
To get to this point, the project required more than two months to develop requirements for each area, select two finalist vendors, develop demonstration scripts for each functional area, conduct the vendor demonstrations, and perform the score collection and analysis.
So remember, if you find someone in your organization making a decision on a piece of technology without doing the due diligence required, take them by the shoulders, give them a good shake, and shout my “three things to remember” right at them. Do that or whatever HR appropriate method you can use to get their attention. Either way, if you are feeling stuck on how to make this decision, feel free to give us a call – The TSI Team can help!
