A Word About IT Vendors

A Word About IT Vendors

Most medium and large businesses have dedicated IT staff that interacts with outside IT vendors selling hardware, software and other IT related items.  Competent IT staff already speak the vendors’ language and can quickly identify those vendors who are either selling snake oil or who are simply incapable of delivering upon their promises.  Unfortunately, most small business do not have the luxury of an in-house IT expert and, as a result, have difficulty identifying the best IT vendors.  This post provides some general guidelines and questions to ask potential vendors that will assist in your decision-making process.

1. References: This should almost go without saying, but ask for and CHECK no less than three references.  Of course, no vendor is going to supply you with a ‘bad’ reference but there are questions you can ask that will give you some real insight into your vendor’s practices.
   1. How long have you worked with vendor? If it’s less than a year, the value of the reference is limited.  As equipment and software age, the vendor support becomes increasingly important (this is particularly true for hardware).
   2. Did vendor hit all timelines? Most software will require some level of customization to meet the needs of the business.  If the vendor missed some timelines, it often means the vendor over promised and under delivered regardless of the final outcome.  It also may mean that the vendor did a poor job in scoping out the service provided (usually because the vendor failed to spend sufficient time with the customer or did not know the right questions to ask).
   3. What has been your experience with vendor’s help desk? If the reference has no experience with the help desk, the value of the reference again is limited.  No matter how great the software or hardware, issues will always arise that require support.  If the help desk is weak, you can expect stormy seas in the future.
   4. What is the response time for a support request? If the vendor services or hardware are mission critical (meaning your work stops until the vendor fixes the problem), initial response time (time until first level support begins to diagnose the problem) should be less than two hours.
2. Demonstrations: Any technology vendor should be able to demonstrate its product.  If the vendor is selling hardware, they should be able to set up a demonstration (either on site or at their site).  They should be able to clearly show that their product is user friendly and can meet the needs of the customer. Software vendors should be able to demonstrate that it can deliver on all promises and will integrate with any other mission critical software and/or hardware.
3. How is support escalation handled? A sophisticated and customer centric vendor will have a help ticket system and an escalation system so that, when you have an issue, it is addressed by the most appropriate response team. When speaking with a potential vendor, ask them an open-ended question such as “Can you describe your help ticket system and escalation process?”  If the vendor does not have a detailed answer, make sure you get one before you sign aboard.
4. Pricing Discrepancies: This is often the most difficult issue for inexperienced IT consumers.  When purchasing an IT product or service, you are usually looking for a specific solution to a need.  Your copier is old and needs to be replaced.  Your CRM software is no longer supported and you need a new solution.  The problem is that there will usually be multiple vendors offering what appear to be nearly identical solutions at widely varying prices.  With that in mind, you must be sure to compare apples to apples.  A few examples where vendors can hide or at least minimize pricing differences include
   1. Service Contracts: Make sure that all service contracts have similar provisions about frequency, response time, one-call resolution, etc.
   2. Consumables: When purchasing IT hardware that uses consumables (ie. printers) make sure you compare long term costs.  There is a reason why ink jet printers are cheap and the ink itself is very expensive.
   3. Customization: Especially with mission critical software, it is not unusual that a business will require some level of software customization.  Be sure that prior to your purchase, you have determined what customization will be needed and how much the vendor will charge you for such services.
   4. Annual vs. Perpetual Licenses: Annual software licenses can look attractive from a cash flow perspective but make sure you compare long term pricing.  If you don’t expect your software needs to change significant over the coming few years, a perpetual license may be your better bet.
   5. Per User Fees: If your software vendor charges by user, make sure you account for future growth in the pricing.  Some companies offer far better discounts than on multi-user licenses.

This is by no means a comprehensive list, but when making a significant investment in IT, asking the right questions can save you money, time and aggravation in the future.