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Your Guide For How To Select Business Software

Updated on March 22, 2016


Business software purchases are unlike any other purchase. Businesses cannot easily compare what they get for the price across multiple software systems like you would if you are purchasing a truckload of cement. This article is intended to guide you to select the right business software quickly and without the common trap of wasting large amounts of time and money to make a decision

Narrow Your Choices

Software comes from many companies and the possible applications are endless. This means you could be wasting large amounts of time just finding a field of candidates that meet your need.

The first thing you should do, before you engage any companies is to determine what software you need. You can begin with what’s simple. If you are a transactional sales company, and you need to provide your sales force with automation, then you will be focusing on Customer Relationship Management (CRM) systems marketplace. If your company sells, and provides a service, and you may need to take CRM systems one-step further by evaluating a Field Service system. Field Service systems are tightly wrapped systems that include marketing and sales (the CRM part), with service calls and customer scheduling and service (the Field Service Part).

Whatever software system you choose for serving your front office, you will always need an automated back office. By back office, I mean accounting. Having the two systems disconnected means high overhead costs and time delays in getting your business information to management. A properly connected system means customers are served well, management is getting fast, reliable information to make good decisions and the company keeps low overhead costs related to managing systems.

Once you identify the general software you need, such as the CRM market or the Field Service market, your next step is to determine which systems within the market you may need. To do this, you will need to focus on applying these next three principles to the market players to quickly eliminate the systems that don’t fit and find the systems that do fit.

Functional Fit

A functional fit means you are looking for a system that provides the features you need. The key to finding your successful system functional fit is to immediately look for the high level, general feature sets you need. For example, in a CRM system, a general fit feature set to look for would be the ability to manage leads. One example of the specific features within the lead management feature set would be entering the 10 different pieces of contact information needed for properly recording a lead. If a system does not have the high level feature set you are looking for, then quickly, without wasting time, eliminate it from your search, because it will not meet your need.

Many software searchers skip the high level feature set search and go immediately to the detailed features needed. Making this mistake will unknowingly commit you to spending far too much time searching for your ideal system.

Software Functional Layers

Technical Fit

A technical fit means you should have the architecture and database components of your desired system in agreement with what you need. Let’s examine the two separately so you know what to look for.

The architecture of a software system is all about how the system operates and what the system can do for you. It can often be easy to understand without technical terms. One simple way to look at it is to ask the question – “Is this a desktop system only or does it run on the cloud?” If it’s a desktop system only, you must eliminate it right away because desktop systems will give you severe limitations you may not be able to accept such as – no mobile capabilities, fewer database sharing capabilities, and higher administrative costs such as maintaining your own software and database to prevent disaster from striking your business. If it runs on the cloud, then you are working in the right direction and can eliminate the above capability limitations of a desktop system and turn them into positives such as having a mobile capability, easier reporting, easier database sharing and system administration belongs to someone outside your company so you can focus on your customers.

Another question to ask is does it run on the hardware we have now? Does it run on the hardware you plan to buy? If you plan to buy apple products, you can reasonably expect your application to run on browsers such as Safari and Chrome and mobile devices like the iPad and iPhone. You should ask these questions to determine if you can immediately use the software system or if you need to purchase new hardware – a much more expensive undertaking, and possibly a surprise expense.

The database components of your desired systems are all about what kind of features your system may be able to provide you. This requires a little more technical know how, but the good news is you will not need a degree in information technology to determine what you need. With databases, a simple rule applies in all cases - your software system’s features are only happening because the database it uses is capable of supporting them. When it comes to database technology, you are looking for an industry-accepted technology provided by a highly known and well-respected database (or software) company where it is widely used by large numbers of businesses in the US and/or the world. Examples of suitable databases are Oracle, Microsoft SQL, IBM DB2, Sybase and others. Some software application companies develop their own database technology. Other software companies prefer to not tell you what their databases are. This means if you haven’t heard of the database your vendor uses, or if you are not told what it is, despite your asking, the database is probably not reliable, or doesn’t provide you with adequate features to drive your business. You should eliminate the entire system right away. Database systems with unknown makers, and small customer bases, and more importantly the shortcomings they contain, will prevent even the best of software systems from having the features you need.

Examples of Ideal Software


Evaluating software for price is easily a matter of what your company can or cannot afford. In today’s software marketplace, cloud based software is the most selected system. Cloud based software is priced with a set fee per user and per month. This price does not include implementation, however, it does include usage and maintenance. This means if you purchase a cloud based system, you can expect to pay an implementation fee, separate from your user fee, during the first few months as qualified consultants setup the software for your specific business and load the database with relevant information you may currently have elsewhere.

You can expect the per user per month fee to begin at the moment of the first software login. Be sure to ask how this fee works. There are usually two methods of how software companies calculate this fee. These methods are “named user” and “concurrent user”.

Named user means that the fee applies to any user with a login credential. This allows credentialed users to login at any time and get access to the system. This kind of fee may result in a higher total cost.

Concurrent user means that the fee limits the users logged in at any particular moment to a particular number of logins. This means that if you have a limit of ten concurrent users, and your company has twelve people who are actually have permission to use the system, the eleventh user to attempt a login may be denied the ability to login until one of the previous 10 users exits the system. This kind of fee may result in lower total costs.

Executive Summary

Executive Summary

When making a business software purchase, the purchase process is different from any other purchase. Here’s your guide:

Begin by narrowing your choices

  • Make a cursory review of alternative available systems
  • Eliminate quickly, candidates that clearly don’t fit your business

In narrowing your choices, and also in making your selection use these three criteria:

Functional Fit

  • Functionality must fit what you need.
  • Use “feature sets” to confirm or eliminate choices
  • Only look for detailed features inside “Feature Sets” after filtering out some choices

Technical Fit

  • Know the architecture and database of your selections
  • Architecture is about where the software can go and what it can do for you
  • Databases are all about what features may be available to you
  • With databases, stick to name brand systems from large companies and large customer bases


  • Begin by knowing what you can afford
  • Be sure to know if your offering is named user or concurrent user
  • Clarify your implementation costs
  • Maintenance costs are usually included in your per user/per month fee

I invite you to contact me if you have questions!

Rodger Stephens, CPA, CGMA

CEO, Prize Performance LLC


Every year, Gartner, an information technology research firm, publishes their “Magic Quadrant” chart. They publish one chart for each of a wide variety of business software markets and the players within them. This chart is intended to be an illustration of the software companies, their products, and their position in the marketplace. Referring to it will help you find the players in your software market and also illustrate their position for your decision enhancement.

Click here for information about the Gartner Magic Quadrant and how it works

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