Supply Chain Software – How Do You Choose the Right Solutions?
One of the most daunting aspects of supply chain software, such as WMS, LMS, or TMS, is the evaluation and selection. Something that will work for your organization, at a price that is within your budget and with enough features to solve today’s business needs (and tomorrow’s).
The supply chain software market can be confusing, with products that look very similar from one provider to the next and sometimes make very similar promises. Even just figuring out where to begin in the supply chain software evaluation and selection process can be a huge challenge.
How do you even know that replacing your existing software is the right answer for your organization? For some tips, check out our ebook on how to think through whether or not you need a new WMS.
We have seen companies embark on this mission of supply chain software evaluation and selection when they didn’t need to. There was a simpler and less expensive answer to their challenges.
If you do know you want to replace your existing solution, here are some resources and things to consider as you work through the process of supply chain software evaluation and selection:
- Use a peer review website, such as Gartner Peer Insights – There are many software evaluation websites that might help you create a list of potential software providers. It’s a good idea to look at the peer reviews that are 2 – 4 stars as you might gain some insight that is helpful in narrowing your list if you come up with 5 or more potential providers.
- Call on your network – Talk to your peers or get in on the discussion groups on LinkedIn. Talk to people who have walked in your shoes already – they may have some very helpful suggestions and offer up things you hadn’t yet considered for evaluating and selecting supply chain software.
- Attend in-person or virtual supply chain conferences (like ProMat) or the user conferences held by the software vendors you find interesting (i.e., Blue Yonder ICON) and talk to other people who have installed systems like what you are considering.
Below are some next steps in the process that you might want to start thinking through. Some might seem like no-brainers, but they are important:
Build a Team
Depending on the size of your company, you’ll want to put together a team of individuals that represents all of the different parties (stakeholders) who will use the software, and thus have a vested interest in the process. For example, if there are multiple facilities in your organization, you may want to reach out to all the General Managers and ask them to each select a resource for the team. It can be helpful to give them a few characteristics you’re looking for such as responsibility level, experience, etc. This will help ensure you build the best team possible and give your project a greater chance for success.
Conduct a Current State Analysis
It’s helpful to build some kind of analysis of what is commonly called the “current state.” Basically, this is information on your company as it stands today, i.e., the number of users at each level, square footage, inbound and outbound detail, etc.
Create a List of Functional Requirements
It’s a good idea to involve the team you’ve built or are building. They should provide you with functional requirements of what exactly this system needs to do. The list will probably need some level of compilation by you or a group of team members, to merge duplicates and to finalize the remaining requirements. After that, there are a number of things you can do such as categorizing and giving the different categories a weight to make sure you get your most important requirements met. This final document will help when you begin soliciting the different software providers for information – sometimes the process involves sending each provider a request for information (RFI) or a request for proposal (RFP). There really is no difference between these although it’s commonly assumed that RFI’s indicate that a company is not as close to purchasing software as a company that is requesting an actual proposal.
Schedule Software Demonstrations
Once you get the responses back from the software providers, it’s a good idea to see some demonstrations of the software in action. These are going to differ from one to the next, so you’ll want to provide a guide to help the providers understand what you’d like to see not only so you get as close to an apples-to-apples kind of comparison as you can get, but also to make sure that the software can meet your top-level functional requirements, i.e., can the product(s) do what you need it to do? As you’ll see once you go through this stage, it can be difficult to keep the products straight, particularly if you’ve not kept the vendor list to three or less. Some pitfalls here are caused by the obvious fact that all software providers want you to buy their software. Everyone wants and needs to make a living, right? So, you may experience all of your selected providers telling you they can meet all of your requirements. When that happens, it makes the job of selecting one even more difficult. For example, integration is generally pretty high on the list for most companies – you need to know that what you’re buying will work/talk to/integrate with everything else you already have. You may hear that each provider offers standard integration – what does that mean? If you don’t know where to ask the deeper questions, you may end up selecting a software solution that will need major additional effort (and money) to work with your existing systems. Think about it like buying a refrigerator when your main requirement other than price is that it makes A LOT of ice. When you get to the appliance store, however, the sales rep shows you the bells and whistles of how your microwave and stove integrate with a given refrigerator, how well they match, and on and on. They don’t bother to start you out with the models having high volume ice makers or, suggesting that you might be better off buying an ice maker given how much ice you go through in a day. Those kinds of tactics can add confusion and frustration so it’s good to remain objective and continue to ask questions.
Appoint an Objective Reviewer
Regardless of the type of experience on your team, some people may develop favorites. You or someone you select needs to be in charge of objectively reviewing the software on how well it meets your top requirements across the board, not how well it does one individual task. Unless of course, that’s absolutely the most critical task your organization does in a day. This is also where weighting particular functionality is important and will help you arrive at the best decision.
Examine the True Cost of Purchase
Now that the demos are done, the notes are taken and features are compared, you need to examine what the true cost of actually owning these different products might mean. The costs range from the obvious, like license fees and maintenance costs to items you may not have considered like training, custom integration, enhancements, software installation, and hardware setup and configuration.
Open Sky Group consultants have experience from all sides of the supply chain software evaluation and selection equation – many have worked for end-users and some for the software vendors themselves. We know the market and the potential pitfalls and can help you understand if Blue Yonder (formerly JDA RedPrairie) WMS, LMS, or TMS is the right software for your organization.