How to reduce the business risks associated with purchasing business critical software?

As the business community starts to look beyond the pandemic and focus on recovery, there will be significant cost pressures in the short term.  During this current period of global change, the purchasing of business-critical software will be a daunting task for small-and-medium sized enterprises (SMEs). 

SMEs typically procure software without a thorough evaluation.  A large majority of SMEs may not necessarily have the advantage (e.g. resources, time) of relying on a centralised procurement function to develop business requirements, to go out to open tender and have the necessary in-house expertise to evaluate the various software products on the market.  Hence, here is a suggested 15-step checklist, which SMEs should consider prior to making a purchase decision on any business-critical software.

In today’s increasingly competitive, technology-driven world, businesses should continually be looking at smarter ways to improve productivity.  Whether it is leveraging cloud computing capabilities to artificial intelligence based automation tools, there are a myriad of software products out there that can serve almost every business need.

The purpose of this article is to provide a useful checklist for organisations to evaluate business critical software through the procurement process. 

A summary of the checklist follows:

  1. Assess & identify internal and external organisational needs:  It is important to know precisely what your strategic goals are and what pain points you are intending to address.
  2. Understand Functional and Non-Functional requirements:  Consult with all end users of the system to ensure their needs and expectations are managed.
  3. Evaluate the scalability & flexibility of the software:  Ensure the system is future proofed for your organisational needs.
  4. Evaluate the software accessibility:  Ensure the system is equitable for all users.
  5. Evaluate the cost and value-for-money of the solution:  Undertake a cost-benefit analysis.
  6. Determine if cloud software product is suitable:  Assess the value of externally hosting.
  7. Assess the organisational security & privacy requirements:  The vendor should pass an independent security and privacy audit. 
  8. Assess the software vendors Business Continuity planning:  Request and review data integrity and back-up strategies.
  9. Assess the software vendors contract:  It is imperative the contract (including the fine print) is clearly understood.
  10. Assess the software vendors deployment capability:  Ensure standard implementation timeframes are included and clearly understood by all. 
  11. Assess the software vendors technology & innovation:    Request research and development roadmaps, plans and priorities. 
  12. Assess the level of training provided by the software vendor:  Ensure training and documentation is readily available.
  13. Assess the software vendors on-going service & support:   Confirm Service Level Agreement (SLA) is readily available.   
  14. Assess the software vendors development and testing resources:  Verify access to production and testing environments.
  15. Assess the software vendors availability of Application Programming Interfaces (API’s):  Confirm integration capabilities with other systems.

Whilst the above checklist is generic in nature, please note, this is not an exhaustive list, and it should be emphasised that any decision to purchase enterprise software must best meet the individual business requirements and ensure the software is ‘fit for purpose’.

Hope this checklist is helpful and it assists in mitigating any potential risks associated with making an incorrect software purchasing decision. For a more detailed checklist please enter your email and click the subscribe button below. 

Alternatively, get in touch: info@e-risk360.com.au

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