Leor Barth, VP R&D at Priority

Integrating new enterprise software into a company’s existing computer system requires precise definition of business needs and methodology in order to ensure the project’s success. Preparing for the implementation of new software should be done carefully and wisely.

 * The sales manager is asking for a new CRM system that supports sales, generates information and tracks customer behavior.
* The COO is talking about new regulation that is not supported by the present system.
* Your accountant is complaining about how complicated your pay slip system is and claims that other organizations use more advanced payroll systems.

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 ERP program. Changing software is a significant event in the lifecycle of an organization, which requires wise and careful planning, review of pertinent information, conferring with those who have implemented the program already and in-depth cost-benefit analysis before making changes. The following are some of the most common mistakes organizations make when choosing software:

  1. The mistake: The new program doesn’t support business objectives.
    The price: The program doesn’t provide the necessary information or applications for achieving the company’s business objectives.
    The solution: 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. And during the planning stage, it pays to learn what companies similar to yours are doing. 
  1. The mistake: Purchasing software without taking into account long-term needs such as growth in the number of employees, in operations, in the number of work stations, etc.
    The price: Within a short time you have outgrown your system and it needs to be replaced or new stations have to be bought in a separate contract. The company has difficulty performing even simple business operations and the financial cost is higher than planned.
    The solution: Take into account long- and short-term considerations when formulating the purchase plan, including options for purchasing in stages or rental of software. Make sure that the finalized deal includes all necessary components. 
  1. The mistake: Purchasing of software that doesn’t communicate with other programs used in the organization.
    The price: Creation of “patchwork systems” that don’t communicate and cause problems in transferring data and files. This results in a loss in information and difficulty in using analytical tools and generating reports. Managers find themselves in a blind alley and, at best, using long and cumbersome file conversion processes .
    The solution: When choosing software you have to ask – Does it communicate well with existing programs? Is data transfer and integration fast and simple? 
  1. The mistake: Refusing groundlessly to adopt cloud computing. Horror stories of companies whose files are exposed to cyber threats have deterred organizations 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.
    The price: Continuous server maintenance tasks and backups in addition to risks of server failure.
    The solution: Adopt cloud computing; it will save backup time and free up server storage space.
  1. The mistake: 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.
    The price: Difficulty in application and implementation of the program due to the implementer’s inexperience and a steep learning curve for employees and information system managers.
    The solution: You might not want to be a guinea pig, but making generalizations about all new programs doesn’t leave a lot of room for trying out new technologies. 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. The mistake: Choosing a well known software brand that might not fit the needs of your company just “to be on the safe side.”
    The price: Failed implementation, lack of functions, the program doesn’t serve the company’s goals, or higher costs than planned.
    The solution: 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, internal maintenance and the like.
  1. The mistake: Choosing an old and well-known program even if it’s at the end of its lifecycle.
    The price: Your company is stuck with an outdated program and increasingly inflated demands on your IT budget due to the need for new investments in software upgrades.
    The solution: Make sure the system includes frequent version upgrades and the latest technologies.
  1. The mistake: Failing, at the onset of the project, to set budget limitations reflecting the organization’s needs.
    The price: Budget deviation and the creation of a bottomless pit that puts project completion at risk.
    The solution: 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. The mistake: Cutting out employee software instruction in order to save money.
    The price: Implementation of an innovative program with many features, only a small percentage of which are utilized. Take MS-Office, for example – most people are not familiar with most of its functions. If you are given instruction you will discover many useful features that you didn’t know about.
    The solution: Insist upon including formal instruction as part of the software purchase plan. 

Translation of an article appearing in Calcalist, January 8, 2015