Evaluating a Tech Partner? Swap Your RFP for an RFI

At some point or another, businesses find themselves evaluating potential software partners. Even we at DMSi, who make our bread and butter from being chosen as software partners, go through this process when we evaluate vendors to integrate with our software.

To make a wise software investment, we’ve found that you need to learn whether a vendor can deliver the things that matter most to your business. But software vendors all build slightly different products. Businesses that prioritize systems that function like their current one might end up with software that has the things they want. But they may discover it’s missing the things they need.

As a software provider, we know vendors respond to information a prospect supplies and demo features accordingly. We also know that businesses often choose new software by using a formal Request For Proposal (RFP). The reasoning behind RFPs is simple: with enough information, the “right” decision reveals itself. The process entails:

1. Making a list of every required and desired feature.
2. Asking vendors whether their system has each feature.
3. Assigning points for each answer.

Presto! The highest scoring vendor has the best software. Right? Wrong. While RFPs can be a helpful tool for a company to start understanding what different vendors offer, they can also lead businesses in the wrong direction.

This is because RFPs prioritize software features over business needs. As scorecards, RFPs ask questions with simple yes/no answers like, “Does the system have feature X?” An RFP doesn’t include key questions such as, “How can your system help us cut costs?” Without open-ended questions, deeper discussions are missing.

Say Hello to the RFI

So, what’s a business to do? How can you be thorough without missing (lumber analogy noted) the forest for the trees?

We suggest a simple twist on the RFP by making it an RFI (Request for Information). An RFI starts with replacing must-have features with must-have business improvements, and then asking a prospective vendor what their software can do to address the improvements.

It makes sense. Business goals drive every major company investment. From opening a new location to adding a new product line, businesses pursue actions that help increase revenue, improve customer loyalty and grow market share. The same logic should apply when choosing new software.

To create an RFI for choosing new software, go through the following three questions and write down your answers:

1. STRATEGIC GOAL: What does the company need to focus on to be successful over the next 10-15 years?
2. BUSINESS STRATEGY: What should we prioritize in our operation to achieve that goal?
3. IMPROVEMENT GOALS: How can we change processes to better achieve our goals?

Coming up with the answers takes time and discussion, and you’ll need to include insights from executive leadership. But once you go through this exercise, you will have what you need to ask the most important question in your RFI: “What can you, the prospective software vendor, do to help us?”

Instead of a features checklist, vendors will talk about your specific business goals and the different ways the software might help to achieve them.

With business goals as the conversation focus, it should become much clearer what a software vendor can offer and who you’ll want to partner with. After all, changing software is a long-term commitment and you want to know exactly what you’re getting. With an RFI, you’ll like the odds of choosing the right system to help your business achieve those goals and the right partner to help you do it.

– Anthony Muck is currently serving on the NAWLA Leadership Summit Committee. He is vice president of sales and marketing at DMSi, an Omaha, Ne.-based company providing business management software for the building materials industry (www.dmsi.com).