Key points to consider when looking for a new EHS software vendor.
Does this sound familiar? Your business has been with the same software vendor for some time. But things aren’t going well. Maybe their technology has become outdated. Or their product roadmap feels uninspired. Maybe customer service isn’t what it used to be. Or maybe your business just isn’t seeing the value it thought it would gain from that initial investment.
And now it’s time for a change. But where does your team start? What things need extra attention when evaluating software vendors to replace the incumbent? And how does your team build the business case internally to justify the switch to leadership?
In this blog, we’ll examine some of the points to consider when exploring a new software partnership, and what to look out for so your business doesn’t find itself back in the same situation a few years down the road.
Why do organizations stay with software that no longer meet their needs?
Change is difficult. Change requires adaptation, and it carries risk. And there’s no guarantee that making the change, however rational and well-thought out, will result in the gains your business wants. These are some of the reasons why companies tend to stick it out with existing processes, programs and, in many cases, technology even when there’s tangible evidence that they are not having the desired effect on business outcomes.
Often, firms will argue the sunk-cost fallacy; that we’ve invested too much time and energy to give up on our software application, even when it’s clearly not working for us anymore. Alternatively, we might convince ourselves that the risks associated with the change are far too great. Will we lose our historical data? What will happen to our key workflows? How long will it take for the workforce to adopt the new solution and see value from the new tool?
But for many organizations, the biggest hurdle they face is that they are not able to clearly articulate to their leaders the cost of their inaction. Yes, change will come with costs. But those costs need to be weighed against the costs that the business will continue to incur, day after day, because the current software vendor cannot help them address their critical business issues.
The Risks of Staying with Systems That No Longer Fit Your Business’ Needs
Before we go further, let’s quickly review some of the risks your business faces by staying with a vendor that can no longer meet your business’ needs.
Higher Costs
The company has invested in software on the promise that it will address your firm’s critical business issues. Staying with an application that no longer delivers value not only means paying for ineffective technology, but also that your business cannot reinvest that budget into a new solution that could address the challenges faced. It’s akin to pouring money down the drain.
Limited Growth Potential
As your business grows, your software needs will evolve. Sticking with a vendor whose software and services cannot scale with your business can limit growth opportunities and hinder operational efficiency.
Technological Obsolescence
Your business is constantly facing new challenges that demand new solutions. Sticking with a software vendor who cannot – or will not – invest in their product can result in your business falling behind its competition. And outdated technology also makes the business more susceptible to security breaches and data theft that can introduce operational risk, legal liability, and financial exposure.
Culture Impacts
Continuing to invest in a solution that no longer meets your business’ needs will not only impact costs. It will impact culture. Your workforce is constantly looking for cues from leadership on how they are enabling front-line staff for better performance. Kicking the decision to replace outdated software down the road can result in employees feeling the leadership doesn’t care about improvement, which can hurt the culture businesses want to create.
Poor EHS Performance
Let’s not forget why your business got into the EHS software space in the first place. The business recognized the value that could be gained from digitally transforming EHS programs, helping improve data-driven decision making, accelerating risk mitigation, and giving a medium for the workforce to actively engage in EHS initiatives. Relying on software that doesn’t work for your business only makes the goal of better EHS performance less attainable.
How to Create a Compelling Narrative for Change
So, if the current solution doesn’t work for your organization, the next step is to convince business’ leaders that a switch is the best approach. It starts by creating a compelling business case for change. Below, we’ve outlined a few items to consider when building the business case.
Conduct a Comprehensive Needs Analysis
Identify the gaps and limitations of the current software application. Highlight areas where the existing solution falls short of meeting business needs, and emphasize how these shortcomings impact overall performance and the ability to achieve stated objectives.
Calculate the Pain
To make a compelling argument for change, demonstrate the real pain created because the existing software cannot meet your organization’s needs. Engage different stakeholders to understand how much time and effort is wasted trying to work with the existing solution. Calculate estimates on the costs that result from these inefficiencies.
Quantify the Benefits
Provide data-driven insights to demonstrate the potential return on investment (ROI) by switching to a vendor that offers software and services more aligned with current and future business needs. Be sure to include projections on cost savings, productivity gains, and risk mitigation.
Highlight the Risks of Inaction
Clearly articulate the risks associated with staying with the current vendor. Use real-world examples and industry trends to underscore the potential consequences of inaction, such as falling behind competitors, increased security threats, poor compliance or legal liability, and the real opportunity costs of staying with the status quo.
Showcase Success Stories
Present case studies, press releases, or examples of other companies that have successfully transitioned to new software vendors. Highlight the positive outcomes, such as increased efficiency, cost savings, and enhanced security.
Leverage Expert Opinions
Consider available data and insights from industry networks, peers, subject matter experts, and analyst publications, including competitive market analyses and buyers guides. Their perspectives can lend credibility to the proposal and provide external validation of the need for – and value from – a well-planned change.
Explore Additional Possibilities
Don’t limit thinking to current challenges and risks. Evaluating a vendor change should also include what opportunities might exist to support new and future ambitions. Alternative vendors might offer a more expansive product portfolio to help address emerging concerns, or enable a consolidation of disparate solutions within a single, unified offering.
Align Change with Business Goals
Emphasize how partnering with a new software vendor will support the company’s strategic goals and vision. Highlight how the change will support future growth, innovation, and competitive positioning.
Evaluating the Right EHS Vendor For Your Organization
Once leadership is convinced that a change is in order, it’s time to explore and evaluate the market and select a vendor that’s best for your organization. In that process, it’s important to remember a few things:
Consider Platform Architecture & Upgrades
Don’t get caught switching to a vendor who makes it incredibly difficult, and costly, to upgrade their software over time. Multi-tenant, cloud platforms are best, since they operate on a consistent code base that allows for seamless access to new enhancements the moment that they are available, without having to plan (and pay for) specific upgrade projects.
Prioritize Configuration Over Customization
Avoid the trap of highly-customized solutions that are difficult and costly to upgrade. Instead, prioritize solutions that offer a configuration layer atop a consistent code base. This structure will ensure customization to the application to meet evolving business needs, without having to wind down expensive custom code whenever an upgrade is wanted or needed.
Consolidate Where Possible
Speak to any CIO/CTO and they’ll likely say that software projects are a great opportunity to reduce redundant systems, and lower the total cost of software ownership. In that sense, put some thought into enterprise platforms that can satisfy more than one functional need. Vendors who offer solutions across multiple EHS domains in a single platform with a consistent user experience will help accelerate user adoption, especially as the program grows over time.
Don’t Get Fooled by Implementation Plans That Seem Too Good to be True
Deploying a new software platform, and migrating all historical data, requires careful, succinct, and thoughtful planning. So, pay particular attention to the vendor’s implementation plan, including phasing, milestones, and resource estimates. Be wary of implementation plans whose costs come well under the average across competitors. They might look cheaper, but these plans often disguise limitations or include assumptions that place more responsibility on staff. Know what your business is paying for.
Evaluate Both Software & Customer Service
This isn’t about just buying software. It’s about (hopefully) entering a long-term partnership with a vendor who is committed to your business’ success. In that respect, it’s important to scrutinize the vendor’s customer service model and approach, and understand how they will support your business’ success now and into the future. Vendors who staff their ranks with EHS & ESG experts will be better positioned to understand your business needs, and ensure solutions that make the most sense for your business.
Want some more information? Check out our blog How to Use Proof of Concepts Effectively in Your EHS Software Evaluation for an in-depth guide on evaluating EHS software.
Final Thoughts
Not every relationship is forever. But that doesn’t mean there’s nothing to be learned from ones that have gone sour. The same goes for software.
Don’t get trapped in the idea that it’s too hard, too risky, or too late to change.
And don’t get caught with a vendor that’s unable or unwilling to evolve with your business. It’s only by understanding the risks of staying with the status quo that we will begin to embrace the opportunity that’s available when partnering with a vendor that truly understands your business, and can deliver products and services that best align with where your organization is now, and where it wants to go.
