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Choosing the Best Software System

Selecting the correct ERP, CRM, DMS, accounting, manufacturing, CMMS, HR, ECM or other software system is much more complicated that it appears. The first question one must answer is whether to use traditional on-premise software, or a hosted, web based software system. This article lists key guidelines for identifying the on-premise or web based software solution best for your organization's requirements.

The Big Question

Many visitors to this site ask about web based software and if it is best for their organization's requirements. The answer to this seemingly simple question rapidly becomes very complex when one considers the fact that a document can be in many forms - on paper (hardcopy) or electronic (digital), received from many sources such as paper archives, web based imaging sources such as copiers, faxes, email, or even another software system, just to name a few.

Experience has shown that true automation can streamline business operations significantly. Yet, even though the fact that automated processing can benefit most operations, the significant expense and deployment time required keeps many from acting. At this point, the cost benefits of on-demand software, also known as "web based software", start to become very attractive. The question "Which is better, traditional in-house or web based software?" becomes the big question to answer.

The purpose of this article is help guide you through the steps required to determine if web-based, on-demand software or traditional in-house system implementation is best for your organization.

Web Based Software

Throw the many benefits of web based software into this mix and things become even more complex. A well-designed on-demand software system can save a tremendous amount of money. This method of delivery, also known as Software-as-a-Service (SaaS), has become very popular in the last few years, for many reasons, as explained below..

Answering the Big Question

In this guide we try to provide help useful to all readers, and are providing some practical questions to consider when evaluating various software systems. Each question is designed to identify some of the "GOTCHAS", i.e., the problem areas most likely to be troublesome or even fatal to a software installation.

Each question addresses a different step in the implementation process, and examines the advantages of both SaaS and in-house, server-based including erp/crm, accounting, enterprise content management, manufacturing, purchasing, warehouse management software, and other system solutions. Comparing the answers to these questions will help you determine if a SaaS or in-house solution delivers the best Return-on-Investment (ROI).

Step One:

Requirements Identification

Q: Is information from many different sources required before your business processes can be made more efficient and productive? Extensive application integration is a key decision factor in choosing a system, i.e., web based or in-house. Examples of potential problem areas to examine closely during this step include:

Each of the above areas need to be examined very closely if they are needed by your current or planned business processes. If only the first three are needed then an web based system with OCR capabilities is suggested. If the answer to other requirement areas is "YES", please remember that the potential cost and risk of integrating those functions with any software, whether SaaS or in-house, could be very high. Also, please bear in mind that in-house software may require modification to conform to a user interface standard, another source of extra cost and risk.

Step Two:

System Implementation

Q: Do you need a solution immediately, as opposed to three to six months or even a year from now? Traditionally, due to the high up-front costs involved, software projects have followed a standard process: This process has worked well for decades, but has several major drawbacks. First, it requires months to complete. Second, the number of departments or outside organizations that may be involved can be quite high: IT for business analysis and requirements definition; purchasing to negotiate the contract; legal to write the contract; software vendors to demonstrate their solutions; VARs and system integrators or internal IT to configure and implement the customizations; and finally, training to make end users productive (not to mention on-going support and maintenance!).

In many situations, because of project timeframes, competitive pressures, and similar, the need for immediate results is pressing. If your situation fits this description, an web based solution could be of tremendous help. You can often evaluate a SaaS solution for a trial period in which you receive a large percentage of your final configuration. Then, if you subscribe to the web based solution after the trial period ends, the final system is further expedited because your business process is already configured in large part.

A quality SaaS solution is developed to meet the majority of many industry specific needs, involving requirements input and refinement from hundreds of customers. Due to this fact, a quality SaaS solutions deliver comprehensive functionality right out-of-the-box.

You can literally be up-and-running in hours with an web based software solution. Most quality solutions also offer extensive, user-defined configuration capabilities that enable users to modify key aspects of system appearance and functionality. If rapid deployment is a key criteria for your project, a web-based, on-demand system offers undeniable benefits.

Step 3:

The Cash Flow Test

Q: Do you want to limit your upfront expense and link cash outlays to measurable benefits as you receive them? The implementation of a new software system of any type, in any organization, involves significant effort and costs, and one of the large costs of an in-house system is the up-front license fee required.

The software-as-a-service (SaaS) model eliminates most up-front licensing costs and replaces them with a modest monthly fee. This monthly fee is usually based on the number of users or a similar measure that increases only as a previously agreed-upon criteria increase. The advantages of this approach are many:

Step 4:

The Evolving Requirements Test

Q: Is it important to you that a large system, such as a computerized maintenance management software system, CAFM, ERP, CRM, HRIS, WMS, ECM, or document management software system be able to adapt easily as your business requirements change and new technologies emerge? In the case of most on-site software packages your firm must incur the cost of annual maintaining and updating the application. One of the largest unforeseen expenses with on-site software packages is the difficulty encountered when trying to launch new functionality or installing a new version, which is primarily due to the proprietary customization required with on-site, in-house software.

Although proprietary customizations enhance the usability of the software, the more extensive customizations in many cases cannot be automatically migrated to the next version of the underlying software. As a result, when the package is upgraded, your firm will faces one of two choices, both bad. Either upgrade the application at high cost and experience delay as the new features are implemented, or to continue using the older version of the software without benefit of the upgrade until it is no longer supported by it's vendor.

SaaS, i.e., web based software can eliminate these obstacles and frustration because upgrades are applied at the data center and available to all users immediately, with no installation or delay. In addition, since there is no software to install at each client site, software upgrades may be made more frequently.

However, even thought SaaS (web-based) solutions tend to be more expandable, some specialized requirements may require specialized functionality that a SaaS application cannot provide, even with integration and configuration. To understand which side of this line on which your application falls, we suggest the following process:

A. Define on paper what you want to accomplish with the new system. This includes the other systems, facilities, groups and companies that will interact with the proposed application.

B. Prepare a flowchart, (a drawing) of the business process workflow, detailing what happens at each step.

C. Focus on identifying the business processes you need to improve, not the technical system details.

D. Share the information collected in A, B, and C above with the vendors you are evaluating. You can conduct this initial research through a formal Request for Proposal or an informal email.

E. Request a demonstration of the SaaS system as it applies to your requirements.

F. Carefully evaluate the vendor's ability to meet those requirements.

When this evaluation is complete you will have a much clearer idea of how much functionality an on-premise and SaaS, i.e., web-based software solution can provide. In the end, which type of software function delivery method you select is a tradeoff between the benefit of an in-house, customized solution and the cost, deployment, and evolutionary benefits of a web based software system.

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