Six Questions to Ask When Hiring a Systems Integrator
1. Does the systems integrator have a process to manage scope, time and budget? Do
they have definable, repeatable and measurable processes?
A systems integration process is a structure imposed on the development of the project, and include different models for such processes, each describing approaches to a variety of tasks or activities that take place during the process.
The term "process" tends to invoke more fear than is warranted on the part of companies and IT staff, but it's really a means to ensure that projects can come in on time and under budget. A frequent problem with projects is "scope creep", that is, a project expanding beyond the original scope of work which leads to additional costs and delayed delivery. Such projects erode the confidence of management in IT, frustrate stakeholders and diminish prospects for future endeavors. To avoid such a scenario, put in place a process that manages project scope based on the hard deadline and limited budget available. For example, if the project involved rolling out a Sales Force Automation solution to the sales team, scope creep may occur if additional functionality such as desired integration with existing legacy systems is brought up after the original scope of work was completed. A solution would be to launch the SFA as originally planned, with a roadmap for future integration. In other words, go live with the proposed solution and examine ways to continually improve the system rather than wait to perfect the system before launching.
Ask the systems integrator what best-practices and methodology do they use for developing and/or implementing systems? Some popular methodologies include: MSF (Microsoft Solutions Framework), RUP/UML (Rational Unified Process/Unified Modeling Language), RAD (Rapid Application Development) and Agile. All methodologies include to some degree the following characteristics:
Specification is the task of precisely describing the application to be written or the process to be implemented. It's been said that success is simply the sum of small efforts consistently executed well. Spend the time up front to drill down to a good level of detail, and your chances for successful implementation are much greater.
With specific tasks set and communicated properly, make sure that processes are repeatable. In fact, if the first two steps are done correctly, the process should naturally be easy to understand and use.
Make sure to close the loop by taking the time to measure results. Determine up front what constitutes "success" and "failure", and what criteria need to be measured. Implementing processes without measuring effectiveness is a waste of time and resources. Results could include goals such as expanding market share, maximizing productivity, improving financial performance or speeding up time to market.
2. How do they minimize cost or what is their cost containment strategy?
In today’s competitive global marketplace, cost containment can take many different forms. On the billing side, some systems integrators will choose a fixed-fee approach by charging a single flat rate for a project regardless of time to implement. Another approach is to set a rate schedule based on different rates for different roles, rather than a “one size fits all” billing.
On the supply side, are they leveraging an offshore outsourcing model with development teams in countries such as India? With reduced costs of offshore teams also come many challenges including geographic disparity, dramatic time differences, project management pains and cultural misunderstandings. Another cost containment strategy many companies opt for is a hybrid nearshore outsourcing model, merging the best of both localized project management with a nearshore development team based in Mexico or Canada. Advantages of this approach include similar time zones, close geographic proximity, and a local management team based in the US.
3. Does the systems integrator evaluate risk/reward on a regular basis?
All projects inherently have some level of risk, as well as reward payoffs. Even if there isn't a formal process in place for analyzing risk/reward, most of us do it on a subconscious level. Spending the time upfront to outline all the potential risks on the one hand, as well as all the possible rewards on the other will allow for better decisions to be made regarding go/no go.
The Institute of Chartered Accountants sums it up best: "All businesses take risks in order to make profits, but those risks need to be managed sensibly in order to ensure commercial survival. To be successful an organization needs to maximize profits for a given level of risk". (Technical Focus: Business Risk Management, Judith Shackleton BSc ACA, January 1997)
Repeated studies have shown that not only are a good deal of business system projects cancelled before they are completed, but a majority of them cost almost double their original budget. To counter these problems, the concept of risk/reward can be applied to ensure projects are better planned, implemented and evaluated.
In the example of a time-sensitive project, are the total cost advantages of a pure offshore systems integrator worth the risk of slipping delivery dates? Or is selecting a hybrid nearshore outsourcer a better balance of reduced risks and acceptable cost containment?
4. Does the systems integrator value a long-term relationship, and how is that portrayed?
As the speed of technology changes, it is more crucial than ever in selecting a systems integrator who can work on a strategic long-term roadmap for your company. Just as developing a relationship with a physician can facilitate your ultimate well-being, cultivating a relationship with a systems integrator can result in a partner who can be relied on for implementations, troubleshooting, replacements and even simple advice.
To cut through marketing-speak, ask the prospective systems integrator for references. Follow through by taking the time to discuss the past projects, including the problem, the proposed solutions, implementation timelines, the working relationship, obstacles and final outcomes. In Harry Beckwith’s best seller “Selling the Invisible”, the author points out the difficulties in marketing a service as opposed to a concrete product; services tend to be more ephemeral and intangible. Your goal should be to discern as best possible whether or not this is the service firm which will guide you in your growth.
If any more convincing on the merits is needed regarding the value of building long-term relationships with your systems integrator, consider a 1999 study by Rice University which found that over the long run, relationship-oriented business service firms achieve higher returns on their investments than do transaction-oriented firms (The Impact of Long-Term Client Relationships on the Performance of Business Service Firms, Piyush Kumar, Journal of Service Research, Vol. 2, No. 1, 4-18, 1999)
5. Does the systems integrator have horizontal or vertical experience, and which is more important to you?
Horizontal experience is defined by a systems integrator having knowledge of particular software systems that span multiple industries or divisions, such as Customer Relationship Management (CRM), Sales Force Automation (SFA), Content Management System (CMS) or any other acronym you could think of.
Vertical experience implies a deep knowledge within a particular industry, such as real estate, legal or manufacturing. Certain industries have extremely high barriers to enter, and thus spawn a community of system providers that understand intimately the needs of the industry. It could be particular legacy technology that the industry is standardized on (say the insurance industry), a number of compliance and regulatory issues to deal with (the mutual fund and finance industry) or simply technology preferences of a segment (graphic designers and Apple computers).
In an ideal world, the systems integrator would have strong knowledge both horizontally and vertically. Unless your particular industry is so unique that the domain knowledge required is very specialized—health care, for instance—it is generally better to select a partner who has a wide breadth of knowledge horizontally. With the appropriate guidance and communication, the systems provider can be taught the nuances of your industry.
6. Does the systems integrator walk the walk? In other words, do they themselves use software to be more efficient in their own business?
Isn’t it amazing how often you deal with service providers who either do exactly opposite of what they proscribe on a daily basis, or neglect to do what they often recommend to clients? In the first example, think of a doctor who smokes. In the second case, how about a technology provider that still relies on archaic processes such as receiving faxes and manually entering in orders versus an integrated sales processing system? If a systems integrator’s goal is to make business more efficient for you, are they following their own advice?
Don’t hesitate to ask what systems they use and how. Probe to find out more details regarding their various processes, from software development, to implementation, to project management. The more efficient and effective they use technology and processes in their own day to day business, the more confident you can be that they will instill the same measures of success with you.