It's Not Personal ... It's Strictly Business

The old maxim -- "It's not personal. It's strictly business" -- has long been a little white lie to assure prospective vendors that our rejection of their offering had nothing to do with them.

But before we had reams of data and metrics to judge vendors on, business decisions often came down to how a prospect felt about YOU as much as business concerns.

Yet, even with so much data at our fingertips for decision-making now, we still get decisions wrong more often than we should. That's particularly true of selecting Software as a Service providers.

How wrong are we? According to a 2024 Gartner Study on Software Buyer's Regret, 60 percent of small businesses with less than 250 employees regretted a recent software selection. Further, 59 percent expect to endure long-term business performance issues from those choices. My own experience in 20 years as owner of a Managed IT services business confirm that for me.

So, how can that be when we can easily gather the Features and Pricing for the SaaS solution right off the provider's website, and access tons of reviews from current customers on software review sites?

Features, Pricing and Reviews don't get personal enough when choosing critical SaaS vendors.

SaaS providers take control over the data and operations you put in their Cloud. You don't know the exact location of your data, the network infrastructure, what 4th party providers have access, and the cybersecurity measures to protect it all. The SaaS provider handles that.

With that kind of partner, you need to know more than the software's capabilities, cost and ratings. You need to know how all of those factors will impact YOUR business rather than rely on the anecdotal evidence of reviewers based on how the solution works in their companies' environments.

It won't do much good to have software that fits your business if your provider suffers from frequent outages, laggy performance, glitches, crashes, support delays, cybersecurity shortcomings, jurisdictional conflicts, a poor reputation or toxic corporate culture.

You don't control any of that, but all of a vendor's problems can affect your company.

To perform proper due diligence, you need to research beyond Features / Pricing / Reviews to consider the following:

• Financial Risk
• Operational Risk
• Compliance Risk
• Cybersecurity Risk
• Legal Risk
• Reputational Risk
• Disaster Risk
• Fourth Party Risk
• Corporate Culture

How deep you go will depend on how critical the solution will be to your company's operations. If your company will be shut down due to an outage at your provider, you need to delve into all of those areas. If you could survive without the app for a few hours or as much as a day or two, you may not need to dig as deep.

However, you should include some or all of those risk assessments in your VRA on EACH finalist. Remember, you are turning part or all of your operations over to that provider.

You can download a copy of my e-Book on performing due diligence on SaaS providers or request an online meeting.