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CRM Software Evaluation Guide
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 The SaaS Software Selection Process

Via our surveys, blog content and member contributions, we have prioritized the most critical evaluation factors in the SaaS CRM and ERP software selection process.

  1. Vendor viability. Software publisher longevity is perhaps the most difficult factor to measure and in the end impossible to accurately predict. Therefore, the best you can do is make a prediction based on a combination of the most salient business points.
    1. Profitability. For the most part unprofitable businesses go away and profitable business remain. History shows that the volume of profits does not correlate well to continued viability, simply that the organization achieves profits on a consistent basis. We highly recommend not doing business with other than profitable software companies.
    2. Negative contingencies. A single lawsuit can close a small to midsize company. Be sure to inquire with any software company being considered (software manufacturer or consultant) if they have any existing suites and any pending or anticipated litigation or other known or unknown contingencies. Any litigation or contingencies should be explained.
    3. Reputation. Reputation has proven to be a measurable indicator of success. For privately held companies, the company's reputation is generally a pass through of the owners reputation. For public companies, their reputation is often more recognized publicly.
  2. Software depth.
    1. Software flexibility. As they say, the only constant is change. Recognize that you will impose new and changing business requirements on your SaaS business system over time. SaaS systems which require programming or customization take a clear and distant back seat to those SaaS systems which demonstrate increased flexibility via configuration or customization performed with visual tools and by non-technical resources.
    2. Missing feature sets and functionality. Unfortunately, software is acquired based on what was shown it can do during the selection process and what the software cannot do is generally not recognized until after acquisition. For every missing feature or unfulfilled functionality requirement that the software cannot accommodate, the user is forced to resort to manual efforts or a supplemental system. Missing features and software functionality has failed many software implementations.
    3. Missing automation. Entering data into a business system is one thing, however, using the system to automate business processes is quite another. Information systems weak on business process automation deliver the lowest ROI (return on investment).
    4. Access to information. There is no competitive advantage to putting data into a system. There can be significant competitive advantage in getting information out of the system. Getting the right information to the right users at the right time drives user adoption and increased ROI. Simple columnar reports are of little to no value. Look for flexible reports, online drill down analysis, drag-and-drop analysis and hypothetical (what-if) modeling. Systems which offer data warehouses increase value dramatically.
    5. Software foundation. The failure to recognize current or antiquated technology is possibly one of the most missed evaluation factors and subsequently results in far more limited system utilization than anticipated. According to analyst firm Yankee Group, "The technology foundation for the hosted solution is critical to the organization's ability to customize it, integrate it with existing resources, and - if desired - smoothly migrate it to an on-premise model later. Key features to look for include a service-oriented architecture, open standard support (J2EE/.NET, Web services, XML), and pre-built application utilities and components delivered as services." Also, recognize that the customization tools provided by the vendor vary greatly in terms of whether they are intended for use by programmers or non-technical resources.
  3. Implementation assurance. The implementation effort is the most missed critical software evaluation factor. There is an implementation which must follow every SaaS business systems subscription or acquisition. While the implementation period may be a fraction of the preceding client/server systems era, it nonetheless exists and is generally the critical success factor (CSF) most overlooked and the ultimate cause for most project failures.
    • Make sure your SaaS vendor understands the implementation process importance. Verify the vendor has an implementation approach, methodology and detailed project plan. Verify the implementation resources are experienced and well trained.
    • Verify that your vendor recognizes that CRM implementations are less about software and more about business strategy and organizational change.
    • Absolutely avoid those vendors who attempt to marginalize the implementation process and are simply looking for a quick sale.
  4. Customer support. While customer support is getting better in the SaaS industry, there are still major differences which dramatically affect user adoption, implementation success and ROI.
    1. Dedicated account management. Calling a help line only to be forward multiple times and leave a message on somebody's voice mail doesn't work reliably. Look for or ask for a named account manager person who will coordinate all tech support and other requests.
    2. Multiple access methods. Look for direct (live) support as well as customer self service options.
    3. 24 by 7. This may or may not be a requirement based on your organization's working hours.

Factors which do not imply longevity:

  • Deep pockets. It's no secret that several current SaaS software companies are simply getting by due to the financial backing of venture capitalists. It's also no secret that venture capitalists mandate the ability to make large returns, are not desirous to throw good money after bad investments and will close a software publisher, generally without advance notice, if that SaaS software publisher is unable to achieve the predicted financial returns.
  • Revenue volume and company size. Revenue volume and company size have not correlated well in predicting company longevity. The downfall and disappearance of some of the largest and most powerful organizations in the world such as Enron, Arthur Andersen and Worldcom demonstrate the inequity between company size and longevity. More so in the software industry, some of the software giants of just over a decade maintained an allure that no competitor could ever challenge them; yet just over a decade later most industry new comers have never even heard of McCormick & Dodge, Management Sciences of America (MSA), Dunn & Bradstreet Software, SSA and other incredibly high flying business applications vendors who appeared untouchable yet no longer exist. It's also notable that when you review the prior mainframe era and subsequent client/server era business application vendors that the first to market vendors who quickly garnered significant market share were not even in business in the following decade.


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