By Pat Yount

So you have to pick a packaged application for your company. The good—and the bad—news is there are a lot of great products available in most product spaces. You can’t look at all of them; you just don’t have time for that. So, in lieu of weeks of product demonstrations (usually driven by the vendor), how does a project manager select what’s best for his or her company’s needs?

The answer is with a systematic, clear-cut, criteria-based approach to packaged application selection. This article will detail a six-step process that will help your team select the best product for your company’s specific requirements. The process is very straightforward, as follows:

  1. Form a multifunctional team. (1-3 weeks)
  2. Define the scope of the selection process. (1-3 weeks)
  3. Detail required product criteria specific to your organization’s needs. (1-3 weeks)
  4. Prepare and distribute requests for information (using the above criteria). (2-4 weeks)
  5. Conduct targeted product demonstrations. (2-4 weeks)
  6. Finalize the selection. (1-3 weeks)

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Step 1: Form a multifunctional team
Ensure that key business areas and IT representatives are on the product selection team. This team will determine how often to meet, how long the selection process should take, and will assist in defining the scope, criteria, and ultimately, in making the product selection.

It is critical to get commitment from a core group on the team to participate in all targeted demonstrations so that the same people can compare the products against each other. This core group must have a representative from the key business areas that the product will affect and a representative from the IT group.

Step 2: Define the scope
The scope of the selection process is the foundation of all other steps and helps vendors quickly determine if their product has potential to meet your needs. To define your scope, start with the situation that triggered the need for a new product solution.

It could be that an existing product no longer functions as required or the company has grown and manual processes now require automation. Whatever the reason, start the scope statement with the basis for the product search.

Next, add key, must-have functionality. If inputs into the system are important (i.e., accepts input from the Internet), add a statement about input functionality. The same rule applies to outputs. If technology requirements are key, add those (stability, scalability, volume handling). Scoping will involve forming a statement that includes:

  • Initial problem triggering the product selection process.
  • Critical functions required of the product.
  • Inputs (if this is key information).
  • Outputs (if this is key information).
  • Integration requirements.
  • Technical requirements.

Step 3: Build the list of required criteria
The project manager should start a list of required criteria and send it out to the rest of the team. Good sources for the first cut are white papers from vendors with products in the space you are evaluating. It helps readability to break the criteria into sections. Sample sections and criteria are shown below:

Includes standard reports on key metrics
Allows for ad-hoc reporting
Includes automatic report scheduling

Operating System (specify operating system requirements)
Database Management System (specify database management system requirements)

Once the criteria are defined, the team needs to determine if each criterion is a “must have,” “should have,” or “nice to have.” This will be the foundation of the next step, preparing the RFI.

Step 4: Convert the criteria to an RFI document
Include the sections developed in step three and let the vendors rate themselves on their ability to meet each criterion (and ask for supporting documentation). This helps reduce your workload and provides written documentation from the vendor of the products’ stated features.

Add a section in which the vendor can specify additional criteria not requested that may be key to the final decision.

Other sections to include in the RFI are:

  • Sample project plans
  • Sample statement of work
  • Sample deliverable documents
  • Sample contract
  • Pricing model
  • Customer references
  • Signature of vendor representative

The vendors should be able to complete the RFI document in two weeks. Request electronic and paper copies of the RFI response and distribute these to the team. The completed documents will be used to prepare a short list of vendors to participate in the next step, targeted product demonstrations.

Step 5: Prepare and distribute scenarios to vendors, and conduct targeted product demonstrations
This step is where the rubber meets the road. Using the criteria rated as “must have” from step three, set up five to seven targeted scenarios. Each scenario will be an application of multiple criteria. For example, show an e-mail campaign from setup through reporting the results. Assume that campaign recipients are from a purchased list that will need to be imported into the system.

The vendors will use these scenarios to demonstrate their products’ capabilities (to your specific requirements). Send these scenarios to the short list of vendors determined from the completed RFI documents. Vendors should be able to demonstrate their product within two weeks.

Send available time slots for the demonstration at the same time you send the scenarios and fill these on a first-come, first-served basis. Provide the core team with a document that includes each scenario and the criteria evaluated under each to use in rating each product. Use these ratings to evaluate product capabilities.

Step 6: Finalize the selection
If you are lucky, there will be one vendor that really stands out to the team. Often, two or even three products are very close. Start negotiations quickly—this is the best time to get added functionality, price breaks, etc.

Beyond price, the team needs to determine what criteria are most important in deciding between the products. A forced elimination process may help. Pair up the criteria and eliminate them one a time until only one or two criteria are left. (This is easier than it sounds). Here are some sample criteria pairings:

Price or Speed (eliminate one criterion; assume price remains)
Price or Payroll Processing (eliminate one; assume price remains)
Price or Scalability (eliminate one; assume scalability remains)
Scalability or Reporting (eliminate one)

By following these six steps, your company should have selected the best product for its unique requirements through a fairly objective, systematic selection process.

This article was originally published on gantthead on Aug. 1, 2001.

Pat Yount has more than 16 years of experience managing a variety of IT projects, from client server to data warehouse to Internet projects. She is a regular contributor to

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