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  • Tarun

Last decade has been the decade of digital transformation. Cloud computing and Software-as-a-Service (SaaS) have been one of the key drivers in this transformation. Software has penetrated every aspect of business and with cloud computing the cost of adoption has become negligible which has led to an explosion of niche-SaaS vendors. To understand the magnitude of this transformation, just five years ago for a medium size business there were an average of about 15 apps/user which has increased to 139 apps/user. This transformation has been wide and deep in an organization, the average number of SaaS-Ops have increased 10x since 2015 and 3x since 2017 in an organization.

This growth has caused different kinds of challenges for businesses. Software discovery & evaluation is quite a resource intensive process for any business and at the same time, the tooling around discovery & evaluation has not kepts with the growth. Even a fairly straightforward software evaluation can take up a few weeks of work. To put things in perspective, just within the category of Quality Management System (QMS), there are over 300 software vendors alone. To add to that, evaluating a software solution involves coordinating meetings between cross-functional groups to gather requirements and then translating that into a solution which meets those requirements.

Typically, most businesses follow the “Request For Proposal” (RFP) process for evaluation and selection of a software solution.

A typical overview of RFP for software evaluation with estimated timelines:

1. Project Initiation: This phase is where stakeholders, project scope & vendor evaluation score criteria are established.

2. Requirements Gathering: This is one of the most resource intensive phases of the project given it requires coordination between cross-functional groups and getting a consensus around it.

3. Evaluation: This phase is where vendors are shortlisted based on the scores given to each solution by stakeholders.

4. Contract: Finally, when the vendor is selected the contract initiation is performed moving towards the implementation phase of the project.


As we see above, this is quite a resource intensive process. Based on industry estimates, it can cost anywhere from 20-25% of the project budget, more importantly, given the slow moving nature of the process, the risk of a project failure still remains high. The whole idea of going through the RFP process discourages businesses from evaluating new solutions which leaves them at a disadvantage compared to their competitors who may be more agile.


To that end, in this ever changing environment any business which adapts will always have a strategic advantage over its competitors. 


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