Fear of commitment

It's easy to become immobile when shopping for software; it's a four-to-six-digit purchase filled with opportunities for error. But you can reduce the stress with a search-and-buying process that smoothes out the emotional rollercoaster.

This multi-step process begins with an evaluation of your methods of operation, goals, and needs and extends through to an evaluation of the proposed software solutions and their vendors.

Know thyself
Some business owners shop for software like they shop for cars — they go from showroom to showroom, letting the salesmen point out special features and tell them what they need and why they want it. But software — need we say it? — is not a car.

Talking to the various vendors about their offerings is critical, but it should not be the first step. Distributors can easily be wooed by the feature-rich offerings of the wrong package if they haven't started with a clear understanding of their business requirements.

The key question in determining business requirements is what a distributor needs the software to do for the business. This is not the same as "knowing your business." Of course distributors know their business, but they most likely do not have all the details on the tip of their tongues.

And "for a distributorship to get software that best meets its needs, it must know what those needs are," says Jim Broughton, president of Dataweld Inc., a software company based in Bossier City, La. "If you know what you need, it's going to be easy to convey that to your potential software supplier," he explains.

Needs review
For example, a rural distributor-ship's business includes making "milk runs," or route deliveries. The truck drivers — the salesmen — load their trucks with electrodes, helmets, wire, and other equipment and head out for a day or several days, making stops at customers' shops and, perhaps, dropping in on potential new customers. After selling a welding helmet, a salesman writes up an invoice, manually adding in all taxes, surcharges, delivery charges, and prices.

The distributor knows that this manual calculation is a major source of errors — and customer complaints. Perhaps there is an opportunity to eliminate the errors, increase customer satisfaction, and streamline the process to help the driver get back on the road faster to see more prospects.

He also thinks that giving his sales-people mobile access to order-entry — taking an order for future delivery in the field and electronically uploading it via modem — would be advantageous, especially for those salesmen who do not return to the store at day's end but go home — where they can update this information via the Internet.

He also wants the field staff to have access to the customer database and inventory data so they can determine if a customer is on credit hold or tell a customer that an item is out-of-stock. He decides these functions would be valuable, some more than others, to the business.

The distributor has now identified several important business functions and needs. He compiles a wish list.

Continuing the analysis, the distributor considers his two stores located in different communities. Those stores are not electronically connected because when the computer system was installed, the telephone company only offered expensive point-to-point service in the area. DSL Internet is now available. And "it's pretty embarrassing when a customer comes in and has better information on the products he offers than his counter people do because the customers went to a vendor's Internet site and the counter people don't have access to the Internet," says Heidi Thometz, director of sales and marketing, Computers Unlimited, Billings, Mont.

So he decides to connect his stores by DSL, including the new store planned for next year— allowing them to share information such as inventory, rent, order-entry data, and other business functions. He adds it to the list.

He also has concerns about cylinder tracking, cylinder rental billing, general ledger, payroll, and other business functions. These go on the list too.

Setting priorities
Another point to consider is the future friendliness of the software. Distributors who want to keep up with the latest software technology must be sure it will accommodate continuing upgrades and new features as they become available.

At the end of this analysis, the distributor will have a comprehensive wish list. That list is then prioritized by asking what functions are absolutely necessary to make the purchase worthwhile. These are "must haves." A second set are the functions that would make wanted improvements in business process. These are middle priority or "wants." The remaining functions — they'd be nice, but not enough to justify added expense — are the "would-like-to-haves."

This list then becomes the system requirements. Now the distributor is prepared to talk to software vendors — not about the cool features, but about meeting business needs.

Can you match this?
The next step is to make a list of software vendors and send out requests for proposals (RFPs). RFPs are simply a way of leveling the playing field — not for the vendors but for the distributor. For small businesses, informal RFPs that include prioritized system requirements may be all that is needed.

Distributors can structure this segment of the selection process any way that aids them in narrowing choices. For example, they may hold face-to-face meetings to discuss the details of their operations and provide vendors with information. Or they may send out RFPs, compare them, narrow the field, and then meet with select vendors. The point is to facilitate the selection process — making it easy to weed out the also-rans and identify the most qualified vendors.

No matter which method is used, the wish list will provide a guidepost or checklist for asking questions and evaluating various software programs and vendors.

Comparing tangelos and clementines
As the proposals come in, it becomes obvious that selecting software is not an apples-to-apples comparison. Every software offering seems to come from a slightly different direction or problem-solving approach. So comparing a large group of vendors may be like comparing apples to oranges, while comparing a small group, perhaps the top three vendors to the gases and welding supply industry, may be more of a clementine-totangelo-to-tangerine comparison; they're all orange-like but with important differences.

Check for the "must haves" before looking for second-and third-priority offerings. "If one of the vendors does not provide most of your needs, then eliminate it," says Broughton. In other words, "make sure the things you need to run your business — every-one's business is different — are there or the vendor is willing to supply them," says Thometz.

At this point, distributors can eliminate some vendors before proceeding.

Due diligence
Most vendors have prepared demos. But distributors must determine how the software will handle their specific needs by asking specific questions, such as "How does it calculate rent?" says Broughton. Again, this is where the wish list comes in handy. By having a prepared list, distributors are likely to ask questions that will result in buying software that emphasizes the right hot-buttons. If a demonstration does not support a vendor's claim, then it should be eliminated.

Another way to differentiate vendors and narrow the field is to compare their service and support capabilities. Questions might include: What support programs are provided? Are they part of the contract? Is there a hotline and who staffs it? Is training a part of the package? How and where is training provided? How long is the warranty? Will the vendor provide data migration — moving data from the old system to the new one?

Having the right software is pointless if key staffers don't know how to use all the functions correctly, or if a distributor cannot get quick answers to software problems that impact daily operations.

Also to be considered is a vendor's viability. Is the vendor financially stable? Profitable? How many customers does it have (if the number is small, the vendor is probably a startup or struggling). Will it go out of business in the short term? Is it an acquisition target? The answers, some of which may not come directly from the vendor, could point to future problems in obtaining needed service and support. "There is nothing wrong with going to Dun & Bradstreet," says Thometz.

Distributors should ask for references — then call them. Those questions may include: What selection criteria did they use? How does the software perform? How was the training? Did they evaluate other vendors? How does the vendor respond to software problems?

At this point, making a decision should seem less threatening. Business needs will be met. Staff will be trained. Data will not be lost in the system changeover. And any technical support needed to sustain and even grow the business will be provided.

Software consultants
The U.S. has many talented, unemployed software consultants. Hiring a well-trained, part-time or full-time software consultant is a tactical option. They can be found through trade organizations that offer consulting services, colleges, trade schools, and new corporate research/training centers sprouting up across the country. One of the greatest finds for any industrial manager is a trustworthy software expert. Finding one that fits your business is the challenge. If you’re considering a part-time or contract consultant, the question you need to ask is who will provide support and training if needed. If you’re considering a full-time software expert, recent gradu-ates in software engineering or related fields are often ideal entry-level people.

Vendors who know the industry A number of software companies offer programs, such as order entry and inventory control, specifically written for the entire distribution industry. And those programs are good. But each "marketplace has its own unique needs," says Broughton. He explains, "Some of the gases and welding supply industry's specific issues revolve around the sale of gases and cylinder rental. Many software packages written for the universe of distributors calculate rent, but these generic packages may not calculate rent the way the gases and welding supply distributor wants to." That's when software demonstrations become invaluable tools. It is a way of making sure vendors understand gas and welding distributors' particular business needs and software functions as required.

Integration is important Thometz says some distributorships only buy the best of breed — best cylinder control package, best accounting package, and best general ledger and payroll. So they end up with X number of software modules from Y number of vendors. Then they need to have the disparate packages synchronized. It's becoming easier for gases and welding distributors to have a software module specifically written and added to generic software suites because present technology can connect the programs and have them work almost seamlessly. But this is not the same as integrating one add-on after another. Both methods will cost. A distributor will have to hire someone to re-key or bring the new module into the present system. Even then, the individual modules may work almost seamlessly. But it's not impossible to have multiple packages. It's just hard to keep the systems in sync.