This article is part of a series aimed to cover the process of selecting and implementing business software solutions and as the title says, this first article is focused on: How to choose the best software solution for my business?
Enterprise software solutions have the ability to dramatically improve the performance of a business, ensuring greater control and perception of operations in order to produce added value for users, management and customers. However, given the effort and impact on the business, if this process is not properly planned it can result in significant losses.
And if there’s one thing in common throughout the years I’ve provided business solutions, it’s that no two implementations are the same. The organizational context, human context, business area specifics, the technological context of the organization, the level of maturity of the business processes, are all factors that contribute to the level of specificity of the project.
Given that these specifics produce a certain level of risk at financial, effort and change levels, from the moment you start assessing an enterprise software solution, it’s necessary to identify which functional and business requirements must be considered, as well as who should be responsible for identifying and validating the requirements, in order to mitigate the process risk.
What are enterprise software solutions
Enterprise solutions are large-scale software systems, capable of centralizing and managing the assigned business areas processes. These systems provide a level of automation, monitoring and information collection that allows to reduce operational costs, increasing the efficiency and effectiveness of processes, while producing performance indicators in real time.
The types of enterprise software solutions and their relevance will vary depending on the size of the organization or business areas, however here are some examples:
- Marketing automation platforms
- Customer Relationship Managment, or “CRM”
- Enterprise Resource Planning, or “ERP”
- Supply Chain Management systems
- Human Resource Management, or “HRM”
- Enterprise Asset Management, or “EAM”
- Business Intelligence systems
Who should be involved
To identify who should be involved in the requirements gathering process, it’s necessary to define the key roles to perform the project tasks.
Typically the necessary resources fall into the following roles:
Profile of the main heads of the organization, the project sponsors must provide the vision and the direction to follow, ensuring the alignment of all involved.
Management profile usually associated with the impacted processes, such as those responsible for production or finance in the case of an ERP, or the sales person in the case of a CRM.
Or Subject Matter Experts, are the specialized resources in the target processes, responsible for the collection, evaluation and elaboration of the requirements.
Suporte e colaboração
Other stakeholders, resources of related areas that have relevant information, and operational support.
Business requirements are the elements that the business needs to ensure its operation, such as business processes, business rules or tasks. The distinction to functional requirements relies on the fact that business requirements represent something that the business needs for its operation, without being directly related to what’s intended from the software solution.
Business processes are for example, employee onboarding, opportunity management or product development. In case of a business rule we have for example, how to determine the discount given to a customer or the criteria for expense approval.
At this stage, it’s highly important to ensure that all stakeholders are involved in the process, in order to ensure the complete and detailed identification of all business needs.
A good practice after identifying business requirements is to categorize and define degrees of importance for them. In this way it’s possible to make adjustments more easily, or to evaluate the proposals received with greater precision.
Functional requirements are the functionalities that the system must perform, from the user’s perspective, in order to suppress identified needs, such as: “When registering a new support request, the system must notify the support team by email, as well as the manager of the person who made the request”.
In this stage, all the desired functionalities must be identified, so it’s important to ensure that all relevant stakeholders are involved. In addition, some resources assigned to this stage must have the necessary background to validate the requirements and assess their feasibility.
On this stage the general characteristics of the tool start to be identified, such as Cloud or On-Premise, multi-language, multi-currency capabilities, extensibility of the tool, export and integration capabilities and overall user experience.
Financial effort will always be a decisive criteria in choosing the right solution, given the solutions broad scope and the potential longevity of the implementation process.
In order to anticipate the financial effort for the investment, the main indicator to consider is the Total Cost of Ownership, or TCO. This KPI identifies all costs associated with the implementation and availability of the solution, including product acquisition or licensing, customization and configuration, corrective and evolutionary maintenance.
The importance of this indicator comes from the fact that, in solutions of this dimension, the effort of customization and maintenance of the tool can become superior to the acquisition or licensing of the product. On the other hand, it’s a common practice to attract the customer through a low initial investment and overly simplistic implementation models, revealing the real cost and complexity only when the customer is already deep inside the project and it’s too late to go back, therefore estimating the TCO as soon as possible in the project is a way to avoid unforeseen costs that can lead to complications.
One of the relevant points in estimating the TCO is the correct identification of business requirements. The way the organization intends to reflect its business processes in the new solution can cause radical variations in the effort and cost of the project, therefore the identification and application of the requirements is a key part in the TCO estimation.
After describing some key steps in this process, it’s also relevant to demystify some ideas and issues that often occur during enterprise software implementations.
No Out-of-the-box solution does what you need
Out-of-the-box or OOB is the way to describe the solution as just acquired, and there are no configurations or customization’s made. Due to the broad scope of this type of solutions as well as the diversity and complexity of different processes and business areas, the software will hardly be ready when you receive it.
Even in an extreme approach of aligning business processes to the way they are reflected in the base solution, something that I do not recommend any business to do, there will always be a need to parameterize the solution.
When purchasing large business solutions, you must always ensure an implementation partner that has the necessary expertise to implement the identified requirements, ensuring that the tool will achieve the proposed objectives.
If you don’t know in detail what the solution needs to do, then the solution can become part of the problem
The pun is intended, because unfortunately, the incorrect or missing identification of business requirements is something that occurs with some frequency. It is also one of the main reasons for implementation costs to start escalating, either through additional effort on the project to suppress information needs or through evolutionary maintenance to correct something that should have been done right from the start.
Properly identified business processes are a premise for successful implementation.
Process and technology need to be aligned
Even with well-identified requirements, situations almost always emerge where the solution cannot fully answer one or other requirement, or else the effort to fulfill them is exaggerated, or else some solution fulfills the most important requirements as no other can, but has some limitations in another area.
Ensuring an exact match in everything the business needs will always be a daunting exercise, so the safest way to approach the subject is to be able to perceive, in each alignment case between processes and technology, which side can be aligned more easily. This is a basic case of the importance in having knowledge and experience on your side, which leads to the next topic.
Choosing the implementation partner is just as important as choosing the tool
Due to the complexity and scope of business software solutions, one of the key aspects to ensure is the choice of the implementation partner. In addition to the common choice criteria such as experience and cost, the implementation partner must ensure the alignment between technology and business, extracting the maximum potential from the solution in a transparent, integrated and effective way.
Sollogica fulfills these requirements with distinction, having the expertise to intervene in requirements gathering or solution implementation stages, ensuring the success of the proposed initiatives.
After reviewing the main topics of the subject, it’s possible to summarize the first steps of the selection process:
Define project team
Assign a team to the process, identifying the target resources for the defined profiles.
Identify business and functional requirements
It emerges from the inventory and mapping of business processes, as well as the requirements analysis.
Through specifications, RFP or other desired model, in order to present to selected partners for proposal development.
Make a shortlist of solution and implementation partners
Shorten the options depending on the requirements and other criteria identified. Several solution manufacturers delegate configuration and customization to partners, so at this stage you should also identify which partners fit you best considering the identified solutions.
With the partners proposals you should already have the main elements to identify the total cost of ownership, which will provide you to fully understand the financial effort over time.
The following steps for effective product and partner selection depend on additional factors regarding the implementation process, which will be covered in the second part of this series: How to implement enterprise software solutions.
If there are questions about this article, or you require additional information contact us through the available channels.