It’s no secret — the retail landscape has changed — significantly. Challenges are new, costs are higher, and competition is rife. Despite this, core business objectives remain unchanged: right product, right place, right time, right price.
There is nothing quick or easy about achieving this. Many businesses know they need help: a new system or a new solution partner. But — there are so many product options, so many Vendors, and so much time needed to evaluate each one, and — what if they choose the wrong solution? This could have devasting impacts on your business.
The Vendor selection process is a series of steps to determine your objectives and requirements matched with Vendor capabilities and at a price that works.
Here is a look at what we suggest the Vendor selection process involves.
STEP 1: SET YOUR OBJECTIVES (THE “WHY”)
In this step, we understand clearly why there is a need for change now. What is your current business context, what is the problem you are trying to solve, who are you solving this for, and how will you know that you have been successful? It is important to clearly articulate your objectives and the associated (measurable) outcomes. Once these are clear and strategically aligned, you can shift your focus to the next step.
STEP 2: DEFINE YOUR REQUIREMENTS (THE “WHAT”)
Now it is time to get a bit more detailed. While it is key for everyone to have a voice, it is also not manageable, so we suggest you select a few ‘power’ users who are able to speak on behalf of the broader teams. Remember: always come back to your objectives in Step 1! Important requirements to capture include:
- Functional requirements – what features and capabilities do you want the solution to have?
- Non-functional requirements – what system qualities and attributes are required (availability, performance, scalability, usability, security, etc.)?
- Technical requirements – what are your technical requirements (cloud-based vs. on-premise solutions.)?
- Vendor requirements – what Vendor capabilities, experience, expertise, years in business, financial viability, product roadmap (innovation), etc. are you seeking?
You will note that there are no detailed cost criteria at this stage. At this early stage, the solution is not yet fully understood, and the Vendor may not have a full enough perspective of your organisation. We propose that cost does not play a significant role in the early stages of the process.
This is all collated in a Request for Information [RFI] pack. The purpose it is to collect written information about the capabilities of a broad base of potential Vendors, with a view to making recommendations for a shortlist. The RFI pack will also contain specific Vendor instructions, your company background, the project scope, and a proposed timeline to complete the process.
STEP 3: DEVELOP A LIST OF VENDORS
In this step, you will use Google, Gartner Magic Quadrants, Forrester, and other software comparison sites to find a listing of suitable Vendors that you believe may be in a position to satisfy your requirements and be a good fit for your organisation. You can now send an invitation to participate to these Vendors and distribute your RFI pack accordingly.
STEP 4: REVIEW RESPONSES AND SELECT A SHORTLIST
As part of your review process, you will agree on selection criteria, scoring & weighting. Selection criteria will vary from product or project to project but may include:
- Cultural Fit (chemistry)
- Industry-Specific Experience (IP & insight)
- Functional Fit
- Technology Fit
- Product Roadmap & Evolution
- Support (including training)
- Vendor Demonstration & Reference
- Commercials (pricing)
Each criterion will be weighted (and all must add up to 100%). A standardised scoring system is applied to each requirement (we apply a 5-point system) and an overall score is derived by multiplying the score by the category weight. This is a critical aspect to ensure a fact base to assess Vendors in a standardised way.
Unsuitable Vendors are identified, and a short list is created. It is important to keep a clear record as to why certain Vendors have been excluded at this stage in case you want to re-evaluate them at a later stage.
STEP 5: ARRANGE DEMOS AND REQUEST REFERENCES
We refer to this as the Request for Proposal [RFP] stage. Your shortlisted Vendors are invited to conduct onsite (or virtual) live demo sessions based on specific use cases and scenarios as provided by you. The scoring matrix is updated to reflect the Vendor demo score, and any other categories may be refined based on demo outcomes.
Your shortlist may at this stage include 2-3 Vendors, for whom you will conduct site visits or reference checks. The RFP response will also include a detailed costing schedule, which now comes into sharper focus for consideration.
STEP 6: SELECT YOUR PREFERRED VENDOR AND COMPLETE THE COMMERCIALS
Outcomes are now collated in full, and you may at this stage have an outright winner, or you may still have 2 close contenders for further evaluation. Once a Vendor is selected, commercial negotiations will commence.
Are you feeling overwhelmed?
While following these steps will help you make the right (or better) software partner decision, this alone does not guarantee success. The investment, the project execution timeframe, and the resourcing are critical. You will need to focus on implementation, integration, data migration, and transitioning your business from its current state to its future state through training and right-sized change management interventions. You may even need to procure new skills and resources to support, manage and maintain your new solution.
Your software choice will only be as successful as the people who use it!
BusinessChain is here to help. We are available to help you to define your requirements and do all the research, documentation, and evaluation for you. We can even manage the full implementation and change management process for you.
Why not give BusinessChain a call today?
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