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How to become better at buying enterprise software

Buying software for your business could not be a more different process than purchasing it for your own personal use. Whereas a consumer may simply click a "get" button in a mobile app store, check an "update" box on a computer or select a box off of shelf in a store, SMBs and enterprise typically take a lot more time - and go through many more steps - in making these kinds of decisions. There's a simple reason behind this extra layer of complexity. Business buyers want to ensure that a product or service meets a range of requirements for performance, security and scalability.

The stakes are high for making an informed choice when purchasing software. Picking something that does not fit your organization's particular needs can incur painful costs in both the short and long terms, including:

  • Customization: After discovering a solution's limitations, more money may be sunk into customizing it to make up for these shortcomings. Additional costs then pile up from having to rewrite applications to match the changes.
  • Replacement: Sometimes a misguided choice cannot be retooled through customizations, though. Finding a wholesale replacement can then be pricey, especially if a software-as-a-service contract was signed and then terminated early.
  • Retraining: Transitioning from one tool to another can take some time to get used to. And that's even before factoring in the big shifts inherent in moving from on-premises IT to the cloud (or vice-versa).
  • Restarting: Some things sound good in theory but don't work so well in practice. Marin County, California, once had to spend $1 million on consulting help to select new software after it lost at least $20 million on a previous unstable enterprise resource planning system.
  • Support: An ineffective system is one that will require more maintenance and helpdesk support. Staff have to devote more time to coming up with workarounds and also potentially evaluating add-ons that patch various deficiencies. End users are delayed by low usability.

In light of these risks, businesses are right to be diligent when purchasing software. The rise of cloud financial software, which brings a lot of new terminology and functionality to the table, has also created incentives to thoroughly vet any solution before buying into it. Let's look at some tips for effectively evaluating business software.

Create well-written requirements
If you have ever taken notes on a presentation or report, you may know what it's like to go back days or weeks later and try to parse some sentence fragment that made sense to you then but is basically incomprehensible now. It is a real time-saver to avoid the quick-and-dirty approach that leads to this scenario when writing software requirements.

Written requirements.

Creating thorough written software requirements can come in handy down the road.

As Chris Doig explained for CIO, good requirements reduce risk and speed up selection. Moreover, you may be able to reuse them down the line for other projects. Detailed titles, thorough descriptions and edit histories are strong building blocks for your requirements.

Understand what the seller is actually saying
SaaS? Cloud-based? These terms didn't mean much 10 years ago, but now they're everywhere, being applied to software that may or may not square with their definitions. SMB and enterprise buyers must be able to cut through the jargon and figure what is really being described, particularly if the solution is billed as cloud.

"[I]f you're buying a cloud solution you need to know the differences," explained Paul Turner, vice president of product marketing at Adaptive Insights, in a post for the company blog. "Is it built for the cloud, or is it on-premise software that's hosted? Is the difference important to you? Is the product really a 'big data' solution - or is the vendor just jumping on the bandwagon? The lesson here is to get the facts behind the buzz before buying into it."

True cloud financial software, such as Adaptive Insights itself, can provide substantial benefits over the on-premises alternatives. Automatic security updates, anytime/anywhere access and easy deployment mean that cloud solutions can provide excellent return on investment.

Do customer and vendor research
Software vendors sell to organizations of all kinds, but some tools may be targeted at firms of particular sizes or in specific verticals. It is important to know if the solution you're eyeing has been designed for and used by peers with similar requirements to your own.

"Avoid becoming an edge case customer."

This way, you can avoid becoming an edge case customer pushing the boundaries of what the software is meant to do. You also get to question prospective vendors and see if others have succeed when operating in similar environments.

There are plenty of resources out there beyond just vendor references. LinkedIn, TrustRadius and Proformative are all good places to start digging for details on whether a given piece of software is going to be a good fit for your requirements.

Hit the ground running with a test
Most vendors will at least show you a demo of the software you're thinking about buying. It's a good idea to go further than this if you can, though.

Workshops can help, as can extended free trials that give you a chance to simulate actual workflows. Make sure you feel comfortable with the software and that you can see it being a useful solution for months and years at a time.

Enterprise software procurement is rarely a pain-free process. However, with clear requirements and a willingness to dig for details on customer stories and technical features, organizations can set themselves up for worthwhile purchases that fit their needs.

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