Weed Them Out!

– Six Criteria for Software Vendor Selection

The technology marketplace has experienced a surge of software companies focusing
on several real business problems and has created their unique value proposition in
several markets like supply chain management (SCM), customer relationship
management (CRM), enterprise resource planning (ERP), e-procurement, and now
wireless. Selecting an appropriate package software solution is not a trivial task given
the number of vendors to choose from within each of these areas. Expanding choices
within the technology marketplace can make decisions difficult and confusing.

The challenge: Weeding out the vendors among hundreds of products, philosophies and
promises, and making the right choice. The criteria and methodology defined within this
document are intended to provide the reader with six criteria to evaluate package
software vendor solutions. Based on commonly considered generic software vendor
selection requirements, the evaluation criteria are intended to supplement--not
supplant--the criteria identified by your individual organization.

Here are the six evaluation criteria:

1. Cost: The estimated relative, expected expense associated with software solution
capital investments, operations/maintenance activities and training.

2. Flexibility: The degree to which architecture components are scalable and open to
product or vendor heterogeneity, based on widely accepted standards.

3. Functionality: The degree to which the software solution satisfies functionality

specific to an organization.

4. Ability to be Implemented: The degree to which the software system is mature,

understandable (based on commercial off-the-shelf software) and supportable by
available skilled personnel.

5. Stability: The degree to which the software solution vendor is performing

successfully within the technology marketplace (CRM, SCM, ERP, etc.) and can be
considered a viable business of competitive consequence.

Usability: The degree to which the architecture improves system and data usability,
while masking system complexities. Criteria that can be used to evaluate alternative
package software solutions and to identify a best-in-class solution are illustrated in
Figure 1, followed by descriptions of each and considerations.
gantthead.com Weed Them Out! - Six Criteria for Software Vendor Selection

Identify Software
Vendor Solution w/
The Best
"Value Proposition"

Stability Implementability Functionality Flexibility

Usability Cost

Evaluation Criteria Figure 1: Evaluation Criteria

The criteria listed in the previous figure are defined in the tables below.

Stability
Description: The degree to which the software solution vendor is performing
successfully within the technology marketplace (CRM, SCM, ERP,
etc.) and can be considered a viable business of competitive
consequence.
Considerations: Financial The competitive health of the vendor, as measured
Performance through financial performance (e.g., revenues, net
income and marketplace value).
Market The degree to which the vendor has successfully
Performance penetrated and won share within target market
segments.
Industry The degree to which industry and technology
Acceptance specialists have endorsed and favorably recognized
the prospects of the vendor’s product offering,
market position and competitive strategies.

Usability
Description: The degree to which the architecture improves system and data
usability, while masking system complexities.
Considerations: Accessibility The degree to which the software solution is
capable of providing appropriate access to
information and functions, regardless of
contact channel.
Third-Party The degree to which the solution either
Support provides all functionality or integrates with
market-leading third-party solutions.

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Cross-Channel The degree to which the solution supports

Consistency customer contact through multiple channels
(e.g., telephony, Web, e-mail, fax, direct
marketing) and ensures consistent and
effective communication.
Transparency The degree to which the software solution
masks the complexity of individual functions
of the system from the user, enhances user
productivity and reduces the possibility of
user errors.

Functionality
Description: The degree to which the software solution satisfies functionality
specific to an organization.
Considerations: Desired The degree to which the solution
Functionality supports common requirements identified
by the organization (e.g., Financials,
Manufacturing, HR, Procurement, Order
Management System (OMS), E-Partner
Sales, E-Sales, Sales Comp, Content
Management, E-Service, Call
Management, Field Service,
Personalization, Data Mart Analytical
Software, Campaign Management, etc.).
Customizability The degree to which the solution can be
customized to support enhanced
requirements via configuration and
programming extensions, reusable and
customizable business objects and visual
development tools.
“Out-of-the-Box” The degree to which the unmodified or
Features uncustomized solution satisfies
requirements with little or no custom
development or configuration.

Cost
Description: Estimates of the expected, relative expense associated with
PACKAGE solution capital investments and with operations and
maintenance activities.
Considerations: Capital The measure of expected cost associated with
Investments acquiring hardware, software and other
Costs components of the solution. These costs
include per seat licensing fees, developer
licensing fees and site license fees.

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Operations/ The measure of expected cost associated with

Maintenance operating and maintaining hardware, software
Costs and other components of the solution.
Training The measure of expected cost associated with
training the trainers, administrators,
developers and the end users.

Flexibility
Description: The degree to which architecture components are open to
product and/or vendor heterogeneity, are based on widely
accepted standards and are scalable.
Considerations: Openness to The degree to which the solution can be
Product/Vendor integrated with other complementary
Heterogeneity technologies without introducing
unacceptable technical complexity and cost.
Technical The degree to which the software solution is
standardization based on standards that are widely accepted
and followed by information technology
vendors.
Scalability/ The degree to which the software solution
Scalable will support a wide variety of system sizes,
Performance ranging from small work groups to enterprise-
wide solutions, while delivering acceptable
performance.

Ability to be Implemented
Description: The degree to which software system is mature, understandable
and supported by available skilled personnel.
Considerations: Technical Maturity The degree to which the software solution
has been tried, tested and standardized
throughout the information technology
industry.
Technical The degree to which the software solution
Complexity comprises heterogeneous, immature and
non-standardized technical components.
Availability of The degree to which skills required to
Required Technical design, implement, operate and maintain
Skill technologies comprising the architecture
are available within the information
technology marketplace.

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Systems Integration The degree to which the software solution

can be integrated with other existing
enterprise systems and office automation
technologies via industry standard
technologies, such as OLE2 and ODBC,
or pre-built and packaged system
interfaces.

By evaluating the vendors and their solutions against the evaluation criteria and related
considerations, organizations should find themselves with only a handful of companies
on their short list.

Contributed by Vyom Bhuta

Vyom is the Pittsburgh Branch Partner for Titan Technology Partners

(http://www.s2v.com/) and provides thought leadership in the areas of E-Business,
CRM, and IT Strategy to organizations and industry practitioners internal and external to
Titan. Vyom can be contacted by email at mailto:vyomb@yahoo.com?
subject=Feedback.

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