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The hidden best step in selecting planning software

November 29, 2006

Companies may follow a variety of steps when evaluating a solution for planning, budgeting, and forecasting, including:

1. RFI/RFP: the list of features for the solution to see how vendors map to those features.
2. Vendor Demo: an overview of the solution with an out-of-the-box demonstration from the vendor.
3. Scripted demonstration: the vendor solution is demonstrated, typically using your data and business structures.
4. Reference checks: your chance to validate vendor claims with existing customers.

While there may be other parts in this process (for example, negotiations or analyst research), some or all of the four steps are typically seen. But what are the next practices that leading companies do? What is a critical proof point when choosing a planning solution?

One of the priorities of The Cognos Innovation Center for Performance Management™ is to help organizations adopt innovative, next-generation practices. Based on analyst and customer research, we will examine the issues surrounding steps in the standard software selection process. Taking a fresh, critical eye on some of these standard steps will point out ways to make each step – and the entire process – more effective for you.

RFPs: While an RFP is valuable to gather information about vendors, it should not be the primary process in evaluating features to discern if a product's capabilities meet your business needs. Most vendors responses will look favorable; most hesitate to answer any question in a bad light.

Vendor demonstrations: While an RFP is usually based on existing limitations that the prospect has with their current technology and process, a standard vendor demonstration does not allow you to gain a "wide vision" of possibilities.

Scripted demonstrations: Even when a company performs a scripted demonstration, it may miss the important proof steps that validate exactly how the solution will solve your specific business issues.

Scenario-based workshops: the extra step that successful companies take

Scripted demonstrations by the vendor that use your data and are accompanied by proof steps carefully determined by you can drive a confident and effective purchasing decision. It minimizes the risk of lack of consensus, which can compromise your initiative.

By replacing the scripted demonstration with a scenario-based workshop that includes concrete proof steps, you can validate that the solution maps to your business and ensure that efficiency gains will be realized. The scenario-based workshop may actually save time over the course of the entire selection process as the right vendor can easily be recognized using criteria that define success.

This part of the selection process deepens the partnership between the vendor and the company, to ensure:

• The vendor understands your business pains.
• You and your company can see and touch the product in the context of your business.
• Your key stakeholders are vested in the decision and become ambassadors to the balance of your company.

This step puts a reality check back in the software selection process. It ensures that feature/function discussions do not overshadow the need to solve the business problem at hand. Scenario-based workshops including proof steps determined by you help connect the features and functions listed in the RFP with your business problem. This may also prove to be an opportunity to review your existing planning and performance management practices versus the proven best practices in the industry.

The value of scenario-based workshop evaluation

Companies gain three values when they use a scenario-based workshop that includes proof points:

1. It goes beyond the feature-function to show how the software package can solve the business problem. It lets you create, configure, and maintain the solution to clearly understand all aspects of the solution rather than just the end result of a standard or scripted demonstration.



2. Get a better sense of the total cost of ownership (TCO) of the software. TCO can be directly related to the flexibility of the solution. Since a scenario-based workshop is a hands-on experience, the level of effort to create, modify, and main the solution becomes clear.



3. It helps galvanize your internal team around the solution. It is an interactive session that involves participation between the vendor and your team rather than a standard demonstration. By having all team members touch the software, you reduce their fears and minimize surprises after the solution is selected.

How to conduct a scenario-based evaluation

To take the scripted demonstration further into a scenario-based workshop, consider the following steps:

• Structure the workshop as a mini-implementation that has defined objectives, duration, and outputs.
• Consider several critical "day-in-the-life" scenarios from multiple points of view such as end users, model builders, and administrators. Use an existing business process and have it configured and modified to demonstrate how the solution performs within your environment.
• Reduce the number of vendors to a manageable number of two to three.
• Involve all significant decision-making parties in the scenario-based workshop. The same people should review all the vendors. This ensures that you can receive the necessary feedback before selecting a solution.
• Make it hands-on for your team. Hands-on evaluations let you weigh relative claims such as "easy," "robust," and "powerful." For example, when a vendor says business users can build the planning models, you need to get business users involved in the building of models using your data matched with the real-life complexity of your business needs.
• Have scripted and off-scripted proof steps. Design a script that will stress-test the solution’s flexibility.
• Consider preceding the scenario-based workshop with a one-day tutorial to familiarize key stakeholders with the basics.

Summary

Scenario-based workshops let you look under the hood and get hands-on to understand not just if, but how the solution can solve your business requirements.

Put stress on the solution: add something unpredictable to see how the software and vendor respond. It's in these moments that you'll learn more than in all of the other elements combined. Your evaluation will be sharper; your team more commited; your momentum greater; and you'll have greater confidence in your vendor selection and the success you expect to realize.

Find Out More Visit the Cognos Innovation Center for Performance Management™ Learn more about IBM Cognos 8 Planning

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