Step-by-step visibility software purchasing guide [July-August print edition]

by Array

KOM’s Marty McGinnis usually leads his clients through the process of selecting the most suitable software, but he has summarized his basic process for MM&D readers.

  • First figure out exactly what your own requirements are. Ask yourself what do you want to accomplish with this upgrade. Determine who the stakeholders are in your organization. Create a cross-discipline team to evaluate your needs and your options. As McGinnis puts it: “I like to say to clients, ‘Don’t tell me what you want right now, tell me where you’d like to be in your ideal solution.’ Then we’ll work backwards from there in terms of what is achievable and what you can afford.”
  • Look to your own major software vendor—the one who already provides the backbone of your system, such as your ERP application. If that vendor doesn’t have the software or module that meets your needs, look to the community of vendors who create add-ons to the main software. If neither of those options looks like it will work, then it’s time to check out the best-of-breed, stand-alone solutions. McGinnis does have one very strong caution to add for this stage: “Whenever I go look for software, the first question I ask is ‘will this vendor likely be here in five years?’”
  • The next question you need to ask is: does the company have the ability to implement the software or help you implement it? “You don’t want them to dump you a piece of shrinkwrap and leave because this is an area where you’re going through continual evolution and you’ll want to be able to grow your system,” says McGinnis.
  • The request for proposal (RFP) stage is next. When McGinnis helps clients through this stage he gets strict. “We lay out quite specific requirements we are looking for and we also lay out our terms and conditions, so if things go wrong, we know who’s responsible for fixing them.”
  • Then it’s up to the software vendors to respond to the RFP. That’s when McGinnis goes through a checklist, comparing what the companies are offering against the requirements listed in the RFP.
  • Invite the companies with the highest RFP evaluations to demonstrate their solutions. McGinnis recommends providing all of the data the vendors need to create the most representative demo possible, but he also goes a step further. “We also throw them sample data in the middle of a demo, just to make sure it isn’t a PowerPoint on steroids.”
  • It’s at this point McGinis recommends doing site visits to see the software in action in similar environments, making reference calls and doing other independent checks.
  • Invite the leading vendor in for a gap analysis. McGinnis says he pays the likely supplier to come in—usually for around a week—and go through a detailed planning session. This is when the nitty-gritty details are worked out: where the interfaces between the systems will be, what customizations will be required, etc. There are two goals at this stage: fully understanding the entire scope of the project and what it will entail, and negotiating the cost of it. “We want the vendor to come back to us with a price on the software and a firm price on the changes and modifications. What we don’t want is to buy the software then have the vendor sit down and say, ‘okay now everything is a mod and you’ll have to pay retail price.’ The price is never better than before you sign the contract.”

To read the companion piece to this article, an in-depth look at supply chain visibility software, click here.