Around a month ago, I wrote wondering about the procurement process and whether with migration of systems to the cloud, companies might start abandoning the expensive and risk prone RFP approach in favor of POCs and trials. The answer appears to be not so much. Since writing that blog, I have made it a point to ask vendors if they are seeing any kind of a shift in procurement processes and, it is quite clear that few are. Perhaps smaller firms and start ups are more willing to do trials and POCs but the vast majority still seem to rely on the RFI/RFP process. Talking recently with a smaller vendor was I think one of the key data points. While that vendor is having success down to word of mouth primarily and with users doing trials, larger firms simply insist on going through a procurement process that means getting the deal inked takes months – and often months after the users first requested the product.
Is it just me that wonders at this situation?
With cloud-based software, one would have thought that software procurement would have modernized in lockstep using trials and POC’s to evaluate and decide on software. As stated in the prior blog, this gives users a chance to really use the solution, learn about it and gain trust. It allows implementation to be fast tracked and risks of introducing unneeded workarounds are minimized. Meanwhile, the RFP process is open to many risks, including the procurement of more solution than is actually needed. However, procurement is also governed by rules around openness, competitiveness and so on. Perhaps it is these that are slowing the modernization of software procurement processes?
I’m very interested in learning more about this topic. Write to me at gvasey at comtechadvisory dot com and give me your thoughts?