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admin , 18. July 2022

Business or IT? Who has the final say, when purchasing an enterprise software solution?

There comes a time in every developing companies’ life, when it is realized that certain tasks in the office could be more efficiently managed by a software solution. That is the moment when the question arises: who needs to decide upon this? Whose responsibility is it?

 

Purchasing an enterprise software solution is a very complex process. The need is typically emerging on the business side, in a specific department, such as back office, customer service, finance or HR departments. The demand may come from various cases. I.e. tasks are too diverse, processes do not require human decisions, too few colleagues for the given amount of work in the available time or just too high rate of typically human mistakes, that may already entail quality assurance risks. In such cases, partial or full automation of some tasks, processes can certainly relieve the burden.
And so, the obvious solution: “Let’s talk to our IT colleagues! They will solve our problem.”
What's wrong with this approach? Is there any problem with that at all? IT knows the market, the range of vendors offering adequate solutions, they also know what resources are necessary to implement and operate the software with all the other details that the specific business department is often not aware of, as obviously they don't need to be.
So, the business manager calls the IT manager and asks for his help. And from that moment, a process starts that, if it is not well thought of, can lead to lots of frustrations and have many pitfalls.
Therefore, here are some thoughts that it is worth keeping in mind for a seamless and smooth software purchasing process:

 

  • Clarification of the various agendas
    You may think it is weird, but certain conflicts of interest between divisions are obvious within an organization. But often you are not aware of them. The IT department generally has a different consideration set from the one of a business department. The former will look at factors, such as easy integration and trouble-free operation, when evaluating a software solution. This is reasonable, as long as it is not at the expense of functionality. As the IT division will not be the one, that needs to use the application on a daily basis, their criteria should not overrule useability and functionality. Therefore, it is worth creating a common set of considerations and expectations involving all stakeholders.
  • Gathering requirements, specification of tasks
    The business user who is working in the office is the only one who truly knows the process, its pain points, where the bottle neck is, what needs to be changed. The IT division doesn’t have these insights, therefore without a detailed list of requirements they cannot assist in finding the right solution (see above the thought on conflict of interests).
    While gathering the requirements, however many details can be overlooked or on the contrary, over-shot. Larger companies work with Business Analysts to help the business department mapping out processes, identifying the bottleneck, and finalize the specifications on that basis.
    If such function is not available in the organization, a vendor who understands the company’s processes, has relevant experience, and is able to assist in the specification phase, can definitely add value. And if so, this competence should also be part of the selection criteria upon which the solution supplier is chosen.
  • Briefing and involving potential suppliers
    The budget matters almost everywhere. In many companies even procurement is involved into the process to make sure you get the “value for money”. Sometimes, the budget can prevent from investing into a more complex solution. In such cases, the parties tend to decide for a more cost effective, simpler solution which does not necessarily meet all the requirements gathered or are only suitable for a short period of time.
    It is therefore worth discussing the possible options with the suppliers. The extent to which a solution can be scaled, or features can be added in the future, is an important consideration. A competent partner can help you find a solution that fits your budget, but at the same time you do not need to compromise on functionality in the long run.
  • Communication, communication, communication
    The most common cause that make IT projects fail is the inadequate communication between the parties - business, IT, supplier. On average, 80% of the functions of an enterprise software solution are almost never or rarely used1. One of the main reasons for this is that requirements of the USER are lost somewhere in the process. To avoid such situations, it is important that the business side has a direct relationship to the supplier. The IT department is often trapped in wanting to build a starship, even though Uncle John only wished for a kite.
    In case the communication between the parties has not worked well, requirements have not been properly defined, the vendor has not been chosen based on the right criteria, etc. - we often think, we have been delivered a bad solution.
    In most cases, the system implemented meets the specification. It requires extra investments to make changes, not to mention the wasted internal resources and the delayed release.
    Foundations of a project are laid at the very beginning, in the selection phase when the requirements are gathered, and the vendor is chosen. If it kicks off in the wrong direction, rarely turns into the right one. That's why smooth communication between all parties is essential already in the project preparation phase.

Answering the question in the title, the choice of an enterprise software solution is usually based upon consensus of the various stakeholders, and the weight of their say depends on numerous factors. However, the successful implementation of a software solution requires the appropriate representation of the USRESs! Including not just the end users who constantly work with the application, but all those who need to extract data from the system or create reports on the performance.

 

Don’t be afraid of IT!

When it comes to the topic of a software, the general reaction of business managers is “I don’t have a clue to about IT, what do they expect from me”. For a business software solution this standpoint is no longer valid! Anyone can handle a smartphone. Anyone can search for an application, download it, and then use it without any issues.
At the beginning of the 2000s Nokia Communicator seemed a bit complicated for the average users so it couldn’t reach many people. Today, low cost basic smartphones know much more than that “complicated” phone with many buttons of 2005. Nevertheless, nobody has a doubt about not being able to use a smartphone in 2019, neither about purchasing it.
Similar to the mobile phone market, enterprise software solutions address the needs of businesses and those users, who work for them. Nowadays, the solutions are not designed for the IT professionals, but for the end users. Only they know well what the expectation from a new enterprise “application” should be. So, if you are a business manager and you do not don’t understand the essence of the software that someone is trying to give you, the solution is not the IT department. You need to look for and alternative option that is easy to understand and use!
The involvement of the IT department in a software selection process is inevitable. Whatever solution you choose, it will be their job to integrate it into the enterprise software environment and operate it. They have the knowledge of the company’s IT policies – e.g. whether it is possible to make a cloud solution, if there are preferred suppliers, how much server capacity is required etc, - and the IT department is responsible to comply with all these regulations and other considerations.
However, they can’t help us in finding out what we need. When gathering business requirements, neither the IT, nor the vendors – software development companies – expect you to write your needs using the appropriate terms in a sophisticated IT language. Usually the sales representatives of the companies supplying IT solution are not IT professionals either. It is way more important, that your requirements and the business needs specified by you are understood.

In conclusion: If you feel the need for a software solution, it is all about identifying precisely what your issues are with the current situation and what is the desired outcome you wish to achieve! Once that is done, you are in the position to negotiate with IT solution suppliers. Obviously during the process, you will have to compromise in technological, budget or other aspects. But if you know what you want, your supplier will strive to achieve it.