Before making a technology purchase, entrepreneurs should do their homework. Many major IT implementations such as introducing a new ERP system can go off the rails because the product isn’t a good fit with a company’s needs.
The risks are also increased by the large number of products competing for your dollars.
Follow these 10 steps to help ensure your tech purchase turns into a profitable investment—not a money pit. If you lack the required expertise, hire an experienced independent consultant to advise you.
- Prepare a strategic plan for your business if you haven’t already done so. The plan should include a vision for the future and an action plan for achieving it.
- Make a list of problems with your current operations and technology solutions. Identify perceived opportunities for improvement.
- Create a “needs assessment” for new technology systems. Be sure to base it on your strategic plan and to include implementation needs, such as employee training and any needed re-engineering of business processes.
- Assess potential costs and available resources, keeping in mind that you will have to maintain your systems and update them in the coming years.
- Use your needs assessment to create a request for proposals to send to vendors. Be sure to consider smaller players, not just major suppliers.
- Score how well vendors meet each requirement, and determine the total cost of ownership of each proposal, including costs for licensing, professional services and maintenance. Get more information about the vendors by seeking references from other companies.
- Invite your top picks to present their products. Provide them with a “demo script” covering the requirements they must address during their presentation.
- Involve employees throughout the process to help ensure their needs are met and that they take ownership of the new system.
- With employees’ help, develop an action plan for implementing the technology you choose.
- Monitor implementation and impacts.
About the Business Development Bank of Canada
We offer business loans and advisory services to help Canadian businesses grow, both at home and abroad. Through our subsidiary—BDC Capital, we also offer a full spectrum of specialized financing, including venture capital, equity as well as growth and business transition capital.
A financial institution owned by the Government of Canada, we support more than 42,000 small and medium-sized enterprises across the country, complementing services available from private-sector financial institutions.
Ambitious and innovative entrepreneurs are the engine of our economy and it is our role, as Canada’s development bank, to help them succeed.