I presented at a CMA Ontario professional development event to 50+ attendees on Dec 3, 2009, and again on Dec 17, 2009 due to a sold out first session with an accompanying waiting list. I shared insights and approaches with the attendees to help them find opportunities to reduce the costs, risks, and time associated with software evaluation and selection. I was then asked to write an article on the topic for the CMA Ontario Member Newsletter because of the high level of interest from their members - published on Jan 2010.

1. http://webservices.cma-ontario.org/cmaw2/leadingindicator/201001/article08.html
Sponsor article
Microsoft Dynamics Strategic Partnership
Surviving the Software Selection Process
By: Anthony D’Ugo and Joel Martin
Anthony D'Ugo is a Senior Manager in the BDO Solutions practice and leads the Corporate Performance Management (CPM)
and Business Intelligence (BI) service line. He is a CGA with over 12 years of experience delivering process and technology-
based solutions including CPM, BI, and ERP. Anthony also advises clients on business process efficiency, software selections,
and their overall information management strategies.
Joel Martin is the Product Manager for Canada for Microsoft Dynamics ERP.
The last 12 months have continued to reinforce the fact that our economy is impacted by the many interdependencies that have
grown amongst manufacturers, suppliers, service providers and customers. Thus many of us have learned that to succeed our
business must be dynamic in nature. Core to ensuring the dynamic business is a competitive one, we must assure that our
people have the right tools to get their job done.
These tools vary from CEO to storekeeper, but all require insight into the job at hand and most of these are now delivered via
software. A savvy organization must constantly be making decisions on how to both invest and deploy solutions that empower,
not hinder, productivity and inter-business relationships. As companies emerge from the current recession, making the right
decisions in their next software selection process may very well have long term ramifications on how well they can grow,
compete and win in the years to come.
Building the Business Case
As a business professional, you will likely be involved in a software selection at some point in your career. Technology is
growing exponentially in all aspects of our lives, both personal and professional. New technologies to enable business
processes are being introduced constantly and they are becoming increasingly affordable for smaller organizations to
implement. Many are going through their next acquisition cycles for software. During the Y2K era, several companies took the
opportunity to implement new ERP systems and are now looking for replacements; almost 10 years later.
Selecting software is a significant investment for any organization. Resources are diverted from core operations so it must be
worth the investment.
How do organizations arrive at the decision to select software? It really comes down to this simple equation: if the cost plus the
risk of your current solution is greater than the value, it is time to take action. The most common symptom is continuous
firefighting. This is where people spend a majority of their time supporting the solution by compensating for weaknesses in the
software and process rather than providing valued analysis and insight.
Recently, I worked with a client to support the re-negotiation of a maintenance contract with one of their software vendors. They
had fallen so far behind in the versions of the software, they paid a premium on their maintenance fees for support. They relied
on two key resources internally to support the entire system who were quickly becoming the highest paid employees in the
organization. After further discussion, I realized the functionality which drove the original decision to select the software was not

2. being leveraged. The software had, over time, become so misaligned with their changing business needs that people had spun
multiple offline processes to close the gaps. This is an extreme case of where the cost and risk of the solution is no longer
providing sufficient value to the organization.
Organizations often fall into the trap of focusing on the technology as the sole source of the unfavorable ROI. Technology is
really only the tip of the iceberg. Data/Information, Process, and People are also key elements in a successful, well balanced,
solution. Organizations go down the technology path because it is often the one of least resistance. Changing processes and
people is perceived as too painful and political. If you feel you are heading down the wrong path, don’t be afraid to put on the
breaks and back track. Ensure you do the proper root-cause analysis; otherwise it could lead to costly mistakes.
After you have determined that the technology needs to change, you will work through a similar decision tree to the following:
When a business process has never been enabled by software, this is considered new software to the organization. You will
then need to decide if you will build your own or buy packaged software. When there are no reasonable software packages on
the market that meet a majority of your needs, you may consider building your own.
With existing software in the organization, the decision will be to replace or upgrade. If you decide to replace the software, you
will then go back to a build or buy decision. Just because there was a previously decision to buy in the past, does not mean that
you will buy again. Your business needs will likely mature over time. Upgrading means staying with your current software and
upgrading to the latest version to take advantage of new functionality. Often organizations that follow the technology path (as
described earlier) will make the decision to replace their existing software when a simple upgrade and some effort to realign the
solution to their current business needs can be a highly effective and lower cost alternative.
A Well Managed Selection Project
Now that you have justified the software selection, you need to initiate the project. How can you help to take the risk, cost and
complexity out of this process?
Leadership Commitment
You have the leaders sign off on the business case, continue to involve them and solicit their support during the selection
process right through to the implementation and roll-out. Without their support, you will find yourself swimming up stream
without the backing to make difficult decisions encountered during most major projects.
Select your Team Wisely
The change management process for software begins at the point of the software selection, not during the implementation or
roll-out of the solution. Ensure you get the appropriate functional and technology representation involved in the process.
Address any user concerns that their interests are being impartially represented.
Follow a Standardized Methodology
Methodologies are typically based on best practices and incorporate the experiences of many previous software selection
projects. It will guide you in conducting an objective and quantifiable process. It helps to keep the focus on the true needs of the
organization rather than on internal political agendas.
Impartial External Decision Support
External consultants can help to accelerate and reduce the risk of the selection process. Ensure your consultant is at arm’s
length with any of the vendors you are considering if they are advising you on the final selection.
Pick your Approach

3. There are generally three types of software selections:
Long-list
Use this approach when there are many software vendors and packages in the market which can potentially meet your
business needs. You will evaluate more or less 10 vendors/packages. Then select two to three short-list vendors to provide
demos and then make your final selection.
Short-list
If there are only a few vendors addressing the business need for your industry, a short list approach is relevant. You are
essentially bypassing the long-list and focusing on the best likely fit vendors. A qualified external consultant can help you
identify the short list of vendors after some initial information gathering sessions.
Fit/Gap
If there is only a single software package commonly used in your industry or if a trusted business advisor has recommend a
specific software package, a fit/gap approach is appropriate. During a fit/gap you are matching your requirements to the
software and identifying any gaps. I will discuss gap closures later.
Evaluate the Landscape
Before you begin evaluating, you need to define your evaluation framework which includes your selection criteria. The selection
criteria are the decision factors which help you measure the degree of fit.
This process begins by gathering and prioritizing your requirements. We often recommend our clients conduct a business
process review to properly identify and define their requirements. Do not set unrealistic expectations about the amount of time
required for this activity. It is often an iterative process which may include discovery between the cross-functional teams. If you
have concerns about your organization’s ability to carry out this task effectively, hire external support to guide them though the
process.
Requirements need to be transformed into selection criteria. If there is one thing I have seen repeatedly make or break the
selection process, it is the quality of the selection criteria. They are generally broken down into five categories:
1. vendor viability and strategy
2. vendor service and support
3. product functionality
4. product technology
5. cost
Category 3 is the most critical and where you should expect to focus a majority of your efforts. Many of the requirements
gathered previously would be used to drive this category of criteria.
Categories 1 and 2 become increasingly important when evaluating smaller vendors. These are fairly standard criteria and can
be borrowed from other selection projects.
Category 4 is important because, implementing software which does not integrate well with your organization’s current
technology infrastructure, can result in higher than desired support costs. Your technology team should be able to provide a list
of criteria, as they would likely have defined this for previous software selections.
With category 5, it is important to understand the total cost of ownership. This is also a relatively standard set of criteria. It
includes many components such as the licensing structure (which can vary greatly from vendor to vendor), maintenance fees,
training, implementation services, hardware and ancillary software requirements.
The best guidance I can provide, when establishing your evaluation framework, is to remember this quote from Albert Einstein,
“Everything should be made as simple as possible but not simpler”. The key is to ensure you communicate simply and clearly
what matters most to your organization so the vendor can respond effectively and your team can rate the vendors accurately.
Even when setting the weighing and rating scales for the criteria, keep it simple.
When it is time to identify potential vendors, do not make assumption on any of the vendor’s software offerings. Technology
changes fast, so take the time to understand the current vendor landscape. The best sources for information in my opinion are:
Independent research firms – Gartner, Forrester, IDC and Aberdeen Group are a few of the post popular independent research
firms. Many of them provide overviews of various software markets updated periodically to reflect the current market conditions.
Professional networks – tap into your professional networks and find out what other organizations are using and how they came
to their decisions.
Conferences and seminars – look for conferences on the topic of the software market of interest. Often you can find events
which include many of the vendors all in one place.
External consultants – many consultants have made successful careers from understanding the software landscapes and can
be a great source of information and direction.

4. The Internet – this is the obvious modern day starting point for answers to any question. The Internet is becoming more and
more cluttered with data and it’s becoming increasingly difficult to derive useful information. A search for ERP will return over 35
million results, so be more specific in your searches.
Making the Selection
Once you have a short list of vendors, you will invite them to demonstrate their software. Your team will rate them using
selection criteria. To ensure this step is carried out effectively, provide the vendors with a demo script and ensure they stick to
it. A demo script is basically sample scenarios for your business processes and can be based on real transactions which are
modified accordingly. This will allow your team to separate the facts from the vendor marketing hype and creates a level playing
field to compare vendors.
It is always a good idea to ask the vendor for references, but also consider seeking out your own. Talk to people in your
professional networks about their experiences. Have a list of questions ready to ask and get a balanced perspective on the
vendors – understand the good, the bad and the ugly.
Remember that you are selecting packaged software. Be realistic when making your selection. Don’t look for a silver bullet
solution. If you want a tool that meets all of your requirements, then consider custom built software. You need to select the best
fit software based on your selection criteria. Expect gaps and define a strategy to close them. You can get the vendors to help
you with this process when responding to your RFI or RFP. Keep in mind that many vendors invest a lot of money in R&D to
ensure their products are designed to incorporate best practices – take this into consideration. The most common gap closures
are:
Third party software – often vendors are partnered with other software vendors to offer customers more options.
Customization – this requires custom programming to enhance the functionality of the standard software offering to meet your
business needs. Understand the impact software upgrades in the future will have on customizations.
Future enhancements – the vendor may address your gap in a future release as part of their product roadmap. From
experience, many of these product roadmaps are not written in stone for both timing and promised capabilities. It is wise to
have a plan B in your back pocket just in case.
Work-around – this is using functionality beyond its design to address a different business need. This can be a very cost
effective gap closure, but often requires some compensating controls.
Do without – use an offline manual process to close the gap and plan to address it sometime in the future.
Once you have made your selection, consider taking a “test drive” with a proof of concept (POC) before you sign any
agreements. Would you buy a car without taking a test drive? This gives your team an opportunity to get hands-on exposure to
the software and get a better understanding of the fit for you organization. Expect that this may be a paid exercise, as not all
vendors or value-added resellers are willing to do this at no cost. Keep in mind that a POC is a major undertaking, so think
twice before considering this as an alternate approach to evaluating your short-list of vendors.
Post-selection Activities
After the selection you have really just passed a major milestone on a longer journey which includes the implementation and
roll-out of the software. There are many activities that bridge the software selection to the implementation.
First, you will need to select a system integrator. This will be the external consultants that provide support to ensure a
successful implementation of the newly selected software. You may have to go through a similar selection process for your
system integrator, but often organizations ask the vendor to recommend a system integrator to accelerate the process. There
are generally three different consulting models: 1) the vendor does all their own consulting; 2) there is a mix of vendor
consulting and a partner ecosystem; and 3) there is an exclusive partner ecosystem.
Ensure that you aim to develop a healthy client-consultant relationship. If you don’t use your consultants enough, you are at risk
of carrying on the project without the needed expert advice. On the other side of the spectrum, if you use your consultants too
much, you are at risk of not gaining the necessary knowledge to be self-sufficient. You are at risk of becoming over-reliant on
your consultants. The healthy relationship is somewhere in between where you both share the workload.
Expect to sign at least three contracts with different terms and conditions: 1) software license; 2) maintenance; and 3)
implementation services. Seek out external support if you are not comfortable that your organization can carry out the contract
negotiation effectively.
Finally, define your implementation roadmap. Where do you want to be in two, three or even five years and work backwards to
define the steps to get there. Don’t try to boil the ocean. This is not a recommended approach often because organizations are
not able to absorb too much change at once. Rather, take a phased approach where you slowly integrate the change into the
organization in chewable chunks. Expect that the first phase will be the most challenging because the software is being
integrated into the organization for the first time.

5. November 20, 2009
Surviving the Software Evaluation and Selection Process
Whether it is time to replace existing software or enabling a business process for the first time, at
some point in your professional career you will likely lead or be part of a team tasked with
evaluating and selecting software, as finance professionals often play key roles in this process.
BDO Solutions invites you to join us for an executive briefing on Thursday, December 3rd
where
we will share insight and approaches to help your business reduce the cost, risk, and time
associated with software evaluation and selection.
About the Presenter:
Anthony D’Ugo, Senior Manager, BDO Solutions
Anthony is a Senior Manager in the BDO Solutions practice and leads the Corporate Performance
Management (CPM) and Business Intelligence (BI) service line. He is a CGA with over 12 years of
experience delivering process and technology-based solutions including CPM, BI, and
ERP. Anthony also advises clients on business process efficiency, software selections, and their
overall information management strategies.
About BDO Solutions:
As one of Canada’s most stable and trusted technology advisors, BDO Solutions draws on 75
years of business and accounting experience to offer unparalleled value to clients. With a deep
understanding of financial systems, BDO Solutions brings the expert advice clients need to align
IT strategy with competitive advantage, making it a true one-stop shop for business solutions.
Date:
Thursday, December 3rd
, 2009
Location:
CMA Ontario
Microsoft Dynamic Business Lounge
70 University Avenue, Ground Floor
Toronto, ON M5J 2M4
416-977-7741
Time:
8:00 a.m. to 8:30 a.m. – Networking and Light Breakfast
8:30 a.m. to 9:45 a.m. – Presentation and Discussion

6. Cost:
Complimentary
CPLD:
2 credits
On-line registration & payment is available for this event using the Society’s 'my CMA
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7. CMA Ontario/Microsoft Dynamics Business
Lounge
REGISTRATION FORM
Surviving the Software Evaluation and Selection Process (Repeat Event)
Whether it is time to replace existing software or enabling a business process for the first time, at some point in your professional career
you will likely lead or be part of a team tasked with evaluating and selecting software, as finance professionals often play key roles in
this process.
BDO Solutions invites you to join us for an executive briefing on Thursday, December 17
th
where we will share insight and approaches
to help your business reduce the cost, risk, and time associated with software evaluation and selection.
About the Presenter:
Anthony D’Ugo, Senior Manager, BDO Solutions
Anthony is a Senior Manager in the BDO Solutions practice and leads the Corporate Performance Management (CPM) and Business
Intelligence (BI) service line. He is a CGA with over 12 years of experience delivering process and technology-based solutions
including CPM, BI, and ERP. Anthony also advises clients on business process efficiency, software selections, and their overall
information management strategies.
About BDO Solutions:
As one of Canada’s most stable and trusted technology advisors, BDO Solutions draws on 75 years of business and accounting
experience to offer unparalleled value to clients. With a deep understanding of financial systems, BDO Solutions brings the expert
advice clients need to align IT strategy with competitive advantage, making it a true one-stop shop for business solutions.
Date: Thursday, December 17
th
, 2009
Location:
CMA Ontario
Microsoft Dynamic Business Lounge
70 University Avenue, Ground Floor
Toronto, ON M5J 2M4
416-977-7741
Time:
8:00 a.m. to 8:30 a.m. – Networking and Light Breakfast
8:30 a.m. to 9:45 a.m. – Presentation and Discussion
Cost: Complimentary CPLD: 2 credits
REGISTRATION FORM
Please fax or email your registration form to Leena Rosenberg, Tel :( 416) 204-3140 or (800) 387-2991 ext 140,
Fax (416) 977-1365, lrosenberg@cma-ontario.org
Name: ___________________________________ Member #:_______________________________________
Tel: ____________________________________ Guest Name(s):_____________________________________
Credit Card (Visa/MasterCard/Amex):_________________________________ Expiry Date: _________________
Signature: ____________________________ Dietary Restrictions: _____________________________________
No refunds for cancellations after December 11, 2009. Substitutions accepted at no charge.