May 15, 2024
A guide to help manufacturers minimize the risks and maximize the rewards associated with software procurement.
According to one survey by Gartner, most manufacturers will increase tech investments in the coming years to help with recruiting, training, efficiency, and more. Software procurement plays an essential part in their growth and competitiveness. In the same survey, however, almost half the respondents felt buyer’s remorse after a software purchase.
These numbers suggest that manufacturers feel pressure to procure newer, better, or additional software, yet many settle on the wrong choices. The increasing importance of technology in manufacturing will exacerbate both these outcomes, along with the disruption and losses caused when companies pick the wrong software partners.
That’s why manufacturers, from the largest to the smallest, need to master the art of software procurement—and fast. Use this guide, which updates software procurement for the modern era and outlines how to get it right repeatedly when the stakes are so high.
How Software Procurement Has Changed
Manufacturers have been buying software for years, often decades, and have processes for each phase: identifying requirements, vetting vendors, negotiating contracts, etc. Regardless of how well those processes worked in the past, they all need to be updated (or replaced) based on how software procurement has changed in the last decade.
Since the arrival of smartphones, everyone has expectations for how technology should look and feel. There are no ‘novice” users anymore. Everyone who interacts with manufacturing software, and especially employees on the factory floor, brings needs and wants to the table. Before, a few software selectors would decide what worked for everyone else. But when each employee is also a software critic, ignoring their input becomes a recipe for disaster.
Modern software procurement involves more people and perspectives than before to identify what end-users at all levels except from new software. Involving these voices in the procurement process improves the odds of selecting the right software. However, it also makes the process larger, slower, and more complicated than before, with more that can go awry.
Software procurement in manufacturing has changed for better and for worse—and more rapidly since the pandemic—but the extent of the change is what matters most. Any business that hasn’t updated its process in the last five years should start now. Here is a guide for getting it right.
Best Practices for Manufacturing Software Procurement
- Start a Center of Excellence: Create a group of diverse stakeholders to regularly discuss the company’s software requirements. Whether called a “Center of Excellence” a “Tech Council” or anything else, the group’s purpose is to explore how software requirements are changing for individuals, departments, and the whole company. This group does not handle the actual procurement. Instead, they surface vital insights about what, when, why, and how to buy.
- Access Vendor Resources: From detailed checklists of features and functionality to personalized business cases with value estimates, vendors are willing and able to provide many resources to assist potential buyers, so take advantage of them all. Likewise, take the lead in the vetting process by, for example, requesting multiple references, asking hard questions, and getting detailed demos.
- Enlist Outside Assistance: In a crowded and competitive software market, procurement means considering more vendors than ever (plus new internal stakeholders). Outside selection consultants can expedite the vetting process and create stronger alignment between buyer and vendor. Often more necessary is help with implementing new software, which consultants can ensure goes successfully.
- Develop a Continuous Process: Think of software procurement as a continuous process rather than something that happens occasionally. As new manufacturing technologies emerge at a faster pace, software procurement will be less about replacing aging software and more about keeping up with evolving industry standards by expanding the tech ecosystem. Have the Center of Excellence meet regularly to discuss current and future tech requirements with the aim to use software procurement proactively and strategically֫—adding the right software before others to gain competitive ground.
A Shortcut for Mastering Software Procurement
Software procurement will drive success or failure for every manufacturer moving forward. Getting it right is paramount—but mastering it takes time. Rather than relying on trial and error (or blogs) to improve, get help from Guide Technologies to make your next procurement run perfectly, from selection through implementation.
