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9 common mistakes companies make when choosing software

Integrating new enterprise software into a company’s existing infrastructure requires precise definition of business needs and methodology in order to ensure the project’s success.

It goes without saying that preparing for new implementation should be done carefully and wisely, although more often than not this is not always the case.

The IT professional can be called upon at any time to implement new systems, often at short notice and from multiple people. The sales manager could ask for a new CRM system that tracks customer behaviour, the COO could demand software to comply with a new regulation, or the company accountant might ask for a simpler pay system. These scenarios and others often provide a catalyst for a company to invest in new software, be it a new module for an existing system or an entirely new enterprise resource planning (ERP) platform.

The following are some of the most common mistakes organisations make when choosing software:

  1. The new program doesn’t support business objectives

Often companies find they install a new system which suits a particular process, but doesn’t provide the necessary information or applications for achieving the company’s business objectives. To combat this, businesses must include all relevant professional staff when defining business processes: from information systems, financial, operations, payroll, and sales managers to the CEO who can provide a broad outlook. During the planning stage, it pays to learn what companies similar to yours are doing.

  1. Choosing a well-known software brand that might not fit the needs of your company just “to be on the safe side.”

There are a number of problems which can arise simply by automatically preferring a brand name over checking the details of the offering. It can lead to failed implementation and lack of functionality. It’s vital to perform an in-depth examination of the program in advance; consult and learn from other companies’ experiences. It is also important to examine cost-benefit aspects and the overall cost of the project (Total Cost of Ownership), including implementation, licenses and internal maintenance.

  1. Failing, at the onset of the project, to set budget limitations reflecting the organisation’s needs

Budget deviation and the creation of a bottomless pit can ultimately put project completion at risk. Therefore, it’s important to include all costs in a budgetary framework during the planning stage. Make sure the estimated budget is based on the company’s business requirements.

  1. Software is purchased without taking into account long-term needs such as new digital sales channels or growth in the number of employees

Without looking at long-term needs, the business could soon outgrow the software solution. As a result, businesses can be hindered by their own success as IT systems have difficulty performing even simple business operations, which will increase the anticipated financial cost. To avoid this eventuality, it’s of paramount importance to take into account both long and short-term considerations when formulating the purchase plan, including options for purchasing in stages or rental of software. Make sure that the finalised deal includes all necessary components.

  1. Purchasing of software that doesn’t communicate with other programs used in the organisation

“Patchwork systems” can be problematic because they don’t communicate and cause problems in transferring data and files, causing a loss in information and difficulty in using analytical tools and generating reports. Managers often find themselves in a blind-alley and, at best, using long and cumbersome file conversion processes. When choosing software you have to ask – Does it communicate well with existing programs? Is data transfer and integration fast and simple?

  1. Refusing to adopt cloud computing

Horror stories of companies whose files are exposed to cyber threats have deterred some organisations from cloud computing. However, the risk to data stored in a cloud is not any higher than to data stored on the company’s server, while the advantages offered by the cloud, including savings in costs and maintenance outweigh other options.

Choosing not to adopt cloud computing can often result in continuous server maintenance tasks and backups in addition to risks of server failure. Consider using the cloud to save backup time and free up server storage space.

  1. Buying an unknown program

The natural tendency to try out new technologies, or to save by downloading a free program from the Internet, is understandable, but it has its price. Unsurprisingly, this can result in application and implementation difficulties – as well as a steep learning curve for employees and information system managers. Sometimes it pays to try out a new and innovative product with unique abilities after verifying who stands behind the product and speaking with others who have tried it. Ask for a demo version in order to get acquainted with it as much as possible.

  1. Choosing an old and well-known program even if it’s at the end of its lifecycle

Avoid landing your company with an outdated program and increasingly inflated demands on the IT budget due to the need for new investments in software upgrades. Make sure the system includes frequent version upgrades and the latest technologies.

  1. Cutting out employee training in order to save money

If time is not spent educating employees in the full capabilities of the software, implementation of an innovative program with many features will be a waste of time if only a small percentage of which are utilised. Take MS-Office, for example – most people are not familiar with most of its functions.

If employees are trained and given instructions they will discover many useful features that they didn’t know about. It’s wise to insist upon including formal instruction as part of the software purchase plan.

Andres Richter, CEO, Priority Software

Image source: Shutterstock/TechnoVectors