June 27, 2009

Performing a Market Analysis for Your Software Project Solution – Part 5

Posted by Brad Egeland

In Part 1, Part 2, Part 3, & Part 4 of this series on performing a market analysis, I’ve covered the following phases:

Phase 1 – Documenting the Requirements
Phase 2 – Identify the Potential Sources
Phase 3 – Vendor Invitation
Phase 4 – Vendor Research – Round 1
Phase 5 – More Detailed Vendor Research – Round 2
Phase 6 – Final Vendor Demos

We are now on to Phase 7 – Final Scoring and Selection.

Phase 7 – Final Scoring and Selection

This phase will involve a final team review of the materials, demo notes and preliminary scoring, performance of joint scoring, determination of the finalist, and notification to the losers and the winner.

Final Team Review

Once all vendor reviews from Phase 6 have been completed and all after-the-demo meetings following each vendor demo have been completed and notes have been documented, then it’s time for the team to finalize scoring or ranking of each vendor in detail against the requirements or against groups of requirements.

Preferrably, and if time allows, give the team 3-5 working days from the last demo to do their own scoring before coming back together as a team.

Joint Scoring

Prior to holding a joint meeting, share all team scoring with each other and designate one individual to be the compiler/consolidator of all scoring info. If the number of requirements is too great, score the vendors on logical groups of requirements. At this point we’re only looking at 2-3 vendors so it shouldn’t be an overwhelming tasks.

During a joint session, perform final scoring of the vendors and discuss any concerns or contradictions. The goal is to come out of this session with a clear and agreed-upon winner. Anything less can lead to more lengthy discussions and working sessions.

Notifications

Once all discussions are over, clarifications and contradictions have been cleared up and a clear winner has been identified, it’s time for notifications. Now that this process is anywhere from 2-6 months old, the losers are going to need some detailed communication and debriefing. After all, they’ve put considerable time, effort and money into trying to win this work with you and your company, so it’s in your best interest to give them some details. Keep in mind, not all projects go well and if the winner performs poorly, then you may need to call on one of these runner-up vendors to step in…so part company amicably, if at all possible.

Notification of the winner should be much easier. However, there is one thing I left out that should be a part of Phase 6 unless the it’s already known or obvious – and that’s cost. As part of the Phase 6 detailed demos and presentation, the vendors should also submit project cost estimates which would include software costs, maintenance agreements, and implementation estimates. These must become part of the scoring and evaluation performed on the final 2-3 vendors because, as we know, cost is always a factor.

However, because you’ve been going through a very detailed and lengthy process to find the most qualified vendor, cost should not be inserted as a factor until you are down to your final selections. By this time, any of the 2-3 vendors could likely provide a suitable solution, so it’s appropriate to base your final decision, at least in part, on cost. To consider cost earlier in the process while some of the vendors still in the running may not be suitable, could be detrimental to the final outcome.

Now it is time to sit down with the chosen vendor and do the following:

Negotiate a final price
Provide an official Statement of Work
Provide final requirements
Define a draft project schedule
Identify key milestones and deliverables
Establish project team roles and members on both sides of the project
Schedule a Project Kickoff

Summary

You’ve successfully completed a lengthy process to identify the best and final solution to your software need. Monitor the process closely early on so a switch in vendors can be made, if necessary, with minimal impact – both cost and timeline – to your company. However, move forward with confidence because at this point a considerable amount of effort has been expended by your SMEs to identify the best solution and you’ve found it.

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