Beyond RFPs: 3 keys to finding the best software vendor

in We all know how the software vendor selection process works. You do a needs analysis, call in some vendors, watch a bunch of PowerPoints, put out an RFP or an RFQ and compare and contrast. Or some version of that. It’s considered a valuable process, and a necessary one, and often the end result is you deploy the solution and then everyone celebrates.  The vendor and the consultants got paid, but it’s entirely possible no meaningful business outcome was attained

I talked in my last blog post about the ideal customer-vendor relationship, which I believe should be a partnership focused not on technology deployment but on tangible business outcomes that move your company forward. To achieve that kind of relationship, you need to look beyond line items on an RFP or RFQ at the type of approach the vendor takes to the market.  Look for three must-have characteristics: A focus on the bigger picture, a minimal friction approach, and an orientation that favors people over process.

    Look for a vendor with a collaborative approach.Focused on the bigger picture

First and foremost, you want a vendor that is focused on making their customers successful. They are not going to be focused on time and materials, or on how much money they make up front. They are going to be focused on getting you to a mutually agreed upon result.

 

That means both parties need to think bigger. You need to think, is this a comprehensive solution or is it a stopgap for a certain business function? The vendor should be thinking that way too, drilling down into your business to find out whether solving this one problem is going to do it for you.

 

There are plenty of people that create great stopgaps for individual business functions. There aren’t too many vendors that are thinking holistically about the customer’s business outcome.

 

To take an example from our industry, there are vendors out there that automate the invoice approval process and they do a great job of it and Accounts Payable departments are delighted.  The invoice comes in, it’s $500, they pay it in 24 hours and they feel proud of that great turn-around time.

 

What they sometimes don’t know is whether or not anyone even ordered the item, whether they ever received the item or whether or not the item was needed.  In fact, even if the employee might have perceived the item as necessary, it might be for a project that is counter to the strategy of the company. Now, as for AP, they just feel good because they managed the invoice. It’s a broken process.

 

Or take another process in our industry--expense reports. We used to have all this paper coming in, and now we’ve automated expense reports and everything now that used to be paper is managed through the expense reporting system.

 

That does nothing for spend management; people could be spending more money because they’re traveling more, they may be staying at more expensive hotels, or doing things that aren’t necessarily required by the company. Where is the pre-approval process for certain categories of spend? That hasn’t even been touched, but you automated the expense report process and you feel good about yourself as a controller. Again, you didn’t solve the broader business issue.

 

Anybody can automate something for you. Look for a vendor focused on business outcomes and results, one that has people internally who understand how to solve your business problems, not just meet your technology requirements.

 

A minimal friction approach

The ideal vendor is not looking to “process” anything. They’re looking for the most straight-line path to results for the customer. To me that means finding places to remove friction, and not introducing additional friction into any process that already exists.

 

What does that look like? Crappy company A comes in and says, “you will have to adopt our tool, roll out training, have people go to this site to do this, follow this procedure to achieve this,” and on and on.  It’s like, “we’re coming in with the technology, and everybody watch out and learn how to do it our way.” Seriously.

 

That is the old way. It’s like taking a VCR out of the box in 1995. Big manual, blue screen, trying to figure out how to record a Seinfeld episode, and it takes 2 hours to do it for your grandparents. Nobody knows how to do it and everyone hates it. That’s option A.

 

Company B comes in with minimal friction. They try to weave themselves into the existing business processes that are happening in the organization. In our industry, examples of weaving in would be, approvals done on a mobile device, visibility into budget, or push notifications on a mobile device. User says,  “Oh there’s something here, I guess I gotta approve the marketing event or promotion that we’re about to kick off .” They press a button and they do it. There’s no training, there’s no learning curve. It’s right there.

 

Company B asks, “How are things running today? How do you conduct business today? How do your expense reports come in today? What are you using for that? How are you sending purchase orders to suppliers today? Is it via fax, is it via a PDF in an email?”

 

Company B listens to you and says, “Great! We can look to incorporate that same process and transition you onto our system.” They’re thinking from a change management perspective, thinking about what it takes to go from a person’s process today to the process tomorrow while understanding people’s natural resistance to change. That’s the big difference, the focus on the result, not the process.

 

It’s like when you take an Apple product out of the box. There is no manual. It just says, “Made in California” and you turn it on.  You learn the way you learn to ride a bike. You just start riding it, vs. reading and referring to section 2.6 on page 59.

 

People over process

That brings me to the third point: Look for a company that is malleable, understands human interaction, understands that it’s 2013, and looks to consistently improve in the way it’s working.

 

Listen to how they speak. Is it, “Version 6.12 requires you to log into this screen, or call this phone number?” Is it like getting on certain airlines, where you’re about to board the plane but since you’re elite level titanium plus-plus you get to board the plane 2 seconds before this other person? What these companies are saying is, we have rigid, bureaucratic processes and this is how we work so this is how you work.

 

A people-oriented company questions processes and uses common sense to adjust. It’s not afraid to fall on its own sword and say, “we screwed this up, we gotta get better.”

 

One company tries to lay down the law. The other is willing to have a dialog with you and adapt based on the your feedback.  It’s an organism that’s evolving in real time.  It’s the difference between a plant that’s growing, and a computer monitor that’s going to be the same in 30 years no matter what I do to it.

 

This is how you notice the difference between vendors. You have to go beyond the RFP and the technology requirements and listen to how they talk and look at how they do things. If you’re looking to partner with a vendor to solve your business problems and not create new ones, look for one that’s gonna focus on getting you to a level of business success, not just implementing some technology.

 

Look for one that’s going to achieve results through a transition process that understands that it takes something to go from today to the future state and helps transition you over, and thirdly one that’s adaptive, that strives for excellence in everything it does vs. a “my way or the highway” kind of approach.