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Choosing the Right Vendor Solution

written by: Lee Clemmer • edited by: Michele McDonough • updated: 7/6/2011

In my IT project experience I've had to decide time and again between various vendors. Sometimes it's hard to determine which vendor solution is best. This article outlines a surprisingly simple method for making choices between vendors. A decision matrix can help make objective decisions.

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    So Many Vendors

    There can be seemingly innumerable options when choosing between vendors. Vendor solutions for IT projects can range in features, price, level of effort, training needed, and much more. Sometimes custom solutions would simply take too long, too much effort, and would not be as good as a solution provided by a vendor. Of course, sometimes vendor solutions are hard to choose between.

    How do we make the best choice? Let's take a look at an effective method to make sound choices when selecting vendor products, solutions, and assistance.

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    All Vendors Are Not Created Equal

    Why can't we just pick the vendor with the lowest price? It's not that simple. Quality of product can and will vary. Evaluate offerings whenever possible. Ask for references. Sometimes several vendors may have virtually identical offerings when comparing bullet points. The prices may be the same or nearly the same, or perhaps there are wide variations in price for no discernible reason.

    It may seem like the bigger vendor would be a better bet, but sometimes this is not the case. Make sure that service providers are bonded and insured. Professional liability insurance held by vendors may never be needed, but it's important that they hold it. For more information on these issues, see my article on Managing Vendor Problems & Failures in Software Projects.

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    Price, Features, Time & Ease Matrix

    I try to use an empirical and objective method to select the best vendor, and I recommend this method as it has served me well in the past. Now, there may be specific, particular reasons or details in your case to choose one vendor solution over another. If that's the case, use those specifics. If you're unsure, give this a try.

    First, we collect information on the vendors we are considering. Then, we get those informed, involved, and the stakeholders together in a meeting. Next, we whiteboard a matrix. Each row lists a vendor solution. Columns are Price, Features, Time, and Ease (or Simplicity). For each vendor solution, give a ranking in each column. Either a number score, (say 1 to 5) or simply High, Medium, and Low. Note that a better price, less time, etc. gets a higher ranking or better score.Decision Matrix Create a last column that is the average of the rankings. The vendor solution with the highest score is the best one. Seems far too simple, right? Surprisingly, this method has worked for me more than a few times. With various departments and stakeholders involved, it can take some politics and biases out of the decision making process, as well. When there are "ties" then we look closely at the details and make an informed choice. We can share the data in spreadsheets or project management tools.

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    The Right Choice

    Sometimes, the best choice isn't the right choice. This may seem contradictory, but let's look at it. What's best may not be feasible with the budget you have. Other requirements may prevent the very best option from working out, such as time constraints or previous vendor choices. Sometimes even politics have influence on choices. So, what in an ideal world might be the best vendor isn't the best vendor for this project, right now. We don't always have to have the very best possible but what will work best to meet the projects needs. If we keep this in mind much of the potential friction and frustration can be set aside. You may say, "Clemmer, these things are common sense!" I believe they bear repeating and keeping in mind. It's the duty of a good project manager to know what to do and why we're doing it.



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