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Selecting Systems For Your Business

November 4, 2016
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Selecting a new computer system for your business can be a daunting task.  Between wading through the multitude of new products that are being introduced to the market each month, weighing the marketing claims of websites and salespeople, and determining where the Cloud fits into your technology landscape, many companies simply pick the product that their competitors are using or one that “looks good” without effectively determining what the “right” solution is that can help to enhance their business.
Fortunately, there is a time-tested approach to evaluating computer systems that systematically leads to selection of a system that’s optimal for your business.
Define Your Requirements
It may sound obvious, but the first step in selecting a new system is determining what you need the system to do.  Identify your needs and create written documentation of your requirements in business terms (not in computer terms), and in as much detail as possible.  For example, if you’re looking for a new General Ledger System, identify any special characteristics that your Chart of Accounts must support, such as departmental or project segmentation.  If you’re selecting an Inventory Management System identify the number of warehouses you expect to occupy and any FIFO or lot-specific stock rotation requirements that the system will need to support.  For Time & Billing Software document the billing arrangements that the system will need to support (e.g., retainer, contingency, fixed-fee, hourly billing) along with reporting capabilities that will allow you to better manage your staff, clients and business.
Feel free to explore and identify ways that technology could enhance productivity and provide additional control over your business processes and profitability.  When listing requirements, assume that everything is possible and everything is free; later, when you evaluate products against your requirements, you’ll judge the relevant merits and cost-effectiveness of different proposed systems as you differentiate between “must have” and “nice to have” capabilities.
Take no requirement for granted.  One of our clients assumed that any sophisticated travel industry system would support multiple currencies, but by listing this capability as a requirement they remembered to look for it in each system they considered.  To their surprise, they found that very few of the systems they examined actually supported multicurrency transactions in the form they required.  They ultimately selected a solution that met 85% of their requirements including multicurrency support rather than a system that met 95% of their needs without this required functionality.
Select Your Software
Once you have identified what your new system needs to do, it is time to begin finding the software that will do this task.  The process of selecting software consists of identifying available products, quantitatively and qualitatively evaluating those products against your list of requirements and selecting a product that represents the most cost-effective solution.  When comparing the software to your requirements, consider the importance of the features that the system does not provide.  Factor in the cost of customization to rectify any shortcomings.  Consider ease of learning, ease of use and industry and technical proficiencies that may be required to operate the system, as well as the time and interest (or lack thereof) you will spend in tailoring the system to your own needs.  For some firms, an ideal solution may be a system which requires much fine tuning yet yields extreme flexibility.  For other firms, a more appropriate solution may be a less flexible system that basically runs itself.
As part of the software evaluation, determine whether the products you’re considering are Cloud-based or require on-premise servers.  Neither model is inherently preferable to the other, but along with security, scalability, reliability and performance considerations, on-premise solutions necessitate capital expenditures whereas Cloud-based systems require recurring operating expenses.
It is important to recognize that the cost of purchasing the software and any additional hardware often represents only a small portion of the total expense of implementing a system.  Fees associated with mapping data and processes to the new system, engineering changes to workflows and controls, and training staff to use the new system often exceed direct software and hardware costs.
Pick the Hardware
Determining the hardware that will be needed to support the new system is actually the easiest part of the process.  If the solution you select is Cloud-based, then the servers hosting the software will be provided by the vendor.  If the system relies on on-premise servers, then you’ll need to be sure that you have suitable network capabilities within your offices.
Most vendors will identify both minimum and recommended hardware configurations for their software based on the number of anticipated users of the system, number of annual transactions and data retention requirements.  It is usually advisable to meet or exceed the vendor's recommended (not minimum) configuration, including 50% to 100% more disk space than recommended.
Use the System
If you have followed this system selection strategy, namely defining your requirements, selecting your software and picking the hardware, you stand a very good chance of implementing a system that will increase your effectiveness, as well as your profitability.  You should experience very few surprises because your selection process has not been based on advertising claims but rather on a systematic analysis of your business needs and how each product will or will not meet those needs.  Invest the time needed to learn the system you selected, and enjoy the benefits of a well-chosen solution for years to come.
About The Author
David Rosenbaum is a principal at Citrin Cooperman and has more than 35 years of experience in the information technology field.  He can be reached at 914.693.7000 or at

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