8 Questions To Ask, And Answer, Before You Invest in New Software
Researching software implementation for your business can be daunting. There are a plethora of software providers offering their services to growers, all with various packages and modules at assorted prices. And they are all vying for your business.
Software provider research and implementation may seem overwhelming at first, but doing your homework will pay off in the long run. Imagine if you spent the time and money to implement a new software package only to find out that the software doesn’t support your business. It is painful to have to start the process all over again.
Here are some of the questions you should asking (and answering) prior to making an investment in software.
When Should You Purchase Software?
As a general rule for growing businesses, when your business approaches the $1 million in annual revenue, it is a good idea to consider software implementation. You don’t necessarily have to purchase an entire software package all at once if expense is an obstacle. You can start by purchasing individual modules.
Create a budget for your software expenses. When you do, make sure to include not only the initial price of the package, but the all-too-necessary ongoing support and maintenance costs.
How Much Should You Budget for Annual Software Expenses?
There is a somewhat simple answer to this question. If you are running a million-dollar business then you should invest 4% to 6% of your annual revenue in technology. This amount may fluctuate year-to-year, but will always remain a part of your annual expenses. Your software package is not a one-time investment.
Are There Alternatives to Purchasing a Full Software Package?
Software implementation doesn’t happen overnight, even if you do have limitless investment funds. Plan on building upon your software up over time. Any implementation that helps you lower your costs will help you grow your business.
If you are working on a limited budget, focus on order fulfillment during your first year. In your second and third years, begin adding additional components such as mobile apps, which tend to be less costly and enable your team to drive the software without having staff piled up in the back office. As time progresses, incorporate online availability and orders, racking optimization, mobile pick and ship, value added, and dashboard reporting — all useful and affordable tools for streamlining your business.
How Long Will it Take to Implement Your Software Package?
The time it takes to implement software greatly depends on scale of your operation, the amount of money you have to invest, and on how motivated you are to implement. Generally, six to nine months is a good estimate for highly-motivated full implementation. There are so many factors, however, so this is by no means a definitive timeline. The initial setup may take nine months, but you may be working well past that on fine tuning.
Year after year, you need to focus on growing and upgrading your software package. You will likely get to a point where you are very comfortable with your software, but don’t expect a finish line.
Will I See my Revenue Skyrocket After Implementation?
Usually the first year of implementation can be rocky and painful. You will have to overcome the learning curve to understanding and using your software, and it takes time to fine-tune your new software system. The good news is that after the first couple bumpy years, most businesses see dramatic improvements due to cost savings and the streamlining of processes.
Being proactive in your software implementation will help you immensely. Learn your software package through and through, and pass that knowledge to your team. Make sure that all of your team members are on board and everyone is working with the software.
How Do I Avoid Common Implementation Mistakes?
There are many implementation mistakes that are commonly made by growers. For instance, growers 1) make their software setup too complex, 2) lack mobile tools, or 3) adopt a software system that makes their data entry too expensive.
The best way to avoid these pitfalls is to know that they exist and to make sure that you communicate clearly with your software provider. It is not uncommon for miscommunication to happen simply because you are using terminology that differs from that of your software provider. If you have to create a glossary of terms to make sure that you are speaking the same language, then do it. Keep communication flowing between your company and your software provider and within your company as a whole.
What is Key to Successful Software Implementation?
Map out your business process. Clearly define every aspect of your business. Your software provider needs to know the A-Z steps that you take to move product out the door.
The goal of software implementation is to save you time and money and lower your costs, so each time you decide to implement a tool or feature, be sure that you are doing so with the goal of decreasing complexity.
When you first begin software implementation, keep your expectations practical. You’ll go through several adjustments in the initial implementation. Focus on getting 80% of your software package operational — the core of your business, then move forward with executing the remaining 20% over time.
Designate at least one key staff person who understands your business process and the implementation from top to bottom. Better yet, have at least two: a primary and a secondary backup specialist. You need an expert on your team to help train and troubleshoot. Make sure that your implementation specialists are fully in charge of all aspects of the implementation. They will play a key role in the successful roll out of your new software system.
How Do I Get the Most Value From my Software Provider?
Once again, it is critical for your provider to understand your business process from A-Z.
Keep your business process as simple as possible. Over-complicating your process will over-complicate your software, defeating the purpose altogether. Create a simple process map for each of your business processes and make sure that it’s being updated in the software. The more mapped out you have your business process, the more benefit you’ll see from your software.
Too many software providers emphasize hiring a staff member who is technologically competent. Understanding technology is great, but your implementation specialist must also understand your business process. Having a deep understanding of both is what makes software implementation effective and helps your business grow. The key to long-term success is syncing the business process with the functionality of the software. And getting it right the first time.
The benefits of modern technology on the growth of your business will amaze you. It will take time and money. You just have to get there.