Software Selection Guide
With thousands of software programs to choose from, how do you go about searching for the best one to meet your needs? This can be a daunting task, as we have all heard horror stories of software implementations go awry – and don’t want to be in the same boat. By following the software selection process outlined below you will build confidence to select the right software for you.
Describe your NeedsThe first thing to do is to conduct a Needs Analysis. Although it may sound complicated, it really is not. You should identify which areas of your operation will be affected by the software. For example, if it is a Purchasing package, will it only affect Buyers, or will the software also cut checks to send to suppliers, in which case your Accounts Payable department needs to be involved? All areas that will be affected by the software should be consulted and a Needs Analysis completed.
To conduct a Needs Analysis you should complete a process map that will capture core business processes within each area. In addition, ask employees in different areas what they like best about the current process, what they dislike and what would make things better. Not only is valuable information gained by this process, but it also involves employees and creates a shared responsibility to make the process work after the software is implemented.
Develop Functional Requirements
Once the Needs Analysis is completed, the next step is to create a list of ‘must haves’. This is functionality that, if it was not present, would seriously impact your operations and customer service. For example, for a warehouse management system (WMS) it could be radio frequency capability due to the need for accurate on-hand quantities. A list of ‘nice to haves’ may then be created to identify functionality that you currently do not have, however it would make life easier if it was present. An example is a report that the software can create using Microsoft Excel so it does not need to be re-formatted.
Establish Selection Criteria
Now that you know what your needs are, you are more than halfway there. One of the biggest reasons for software failures is that the functional requirements have not been properly determined. Of course, we only hear about how the software is at fault, which creates our negative perception on the packages that are out there.
- Financial: Is the software provider financially sound? You want to make sure that they will be around over the next 5-10 years to provide you with support.
- Number of Installations: How many packages are currently in use? It would be better if a large number of those are in your industry.
- User’s Group: Is there a user’s group where suggestions, upgrades and information sharing can take place? This is an indication of the software providers’ dedication to continuous improvement.
Request for Information
Now that you have some selection criteria defined, it’s time to see what is out there to meet your needs. Usage of trade journals, the Internet and referrals can be a good source to obtain a list of potential software providers. On-line tools such as the Inbound Logistics Planner allow multiple requests to solution providers upon entering requirements once, speeding up the process. What I have found more useful is to create an Excel spreadsheet with a list of your functional requirements to each provider. Ask them to fill in the blanks for each of your requirements. When you receive all of the responses, they can all be viewed on a single page and comparisons can be made much easier. You are then able to ‘weed out’ those providers that do not meet your needs and focus on the core list.
Request for Proposal
If you are considering a large software purchase (ie. over $50,000), I recommend an additional step, the Request for Proposal. This is a document that outlines all of your functional requirements, sets contract terms under your organization’s specific policies for purchasing software and includes customer reference contacts, financials, installed base, etc. This document may serve as a contract later on if you do purchase from a software supplier, giving you added protection. You may need to hire a consultant to perform this piece for you if you are not familiar with RFP’s.
Product Demonstrations
You have now narrowed it down to 2-3 software packages. It’s time for a demo! Make sure that the provider does not show you a PowerPoint presentation of the software; you want to see it in a live environment. It is useful to have some ‘scenarios’ planned for the demo. Examples of scenarios are: entering a purchase order into the system, creating a ‘rush’ order for a customer, handling a customer return, etc. You will then have a consistent basis for evaluating each software package. Rank the packages based on a ‘points’ system that you have developed. The highest ranking software should be the preferred choice.
Check Vendor References
Now that you have selected the software, it’s time to check references. These references should have been provided to you earlier in the RFP process. Ask questions that address how happy the other customers are with the software, if there was adequate support, what challenges they faced and how they managed through them. Also ask if they would buy the software again.
Having made your selection decision after doing your due diligence, you are now able to recommend the purchase of the software to your company. You also have all the back-up information needed to answer any questions others in your company may have. After negotiating the licencing fees, consulting fees, and the annual maintenance package fee it’s time to set the implementation schedule and begin the installation. Although this process does not guarantee that there will be no issues during implementation, you will have greatly mitigated serious risks that may have otherwise been present. Good Luck!