A Spotlight on the Lessons Learned by Performio’s Founder, David Marshall
What could go wrong?
As you know, business software implementations don’t always go according to plan. If you have been involved in selecting a major business software solution in the past (e.g. a CRM, ERP, HRIS), you might have noticed how different the buying experience is compared to the implementation experience!
During the buying process, the vendor’s products looked great and everything seemed to be possible. Then the implementation starts and everything changes. Obstacles appear and what seemed simple is now intractable, costs escalate and timelines blow out.
Business apps versus solutions – which one is it?
I have written this post to distill what I have learned from 25 years of experience in purchasing and selling business software. From the early days of installing an on-premise CRM solution (which was a total disaster that consumed 12 months of my life) to selling sales performance management and incentive compensation management software solutions in the cloud for the last decade, this guide serves as a reference to the lessons learned and the strategies to deploy today.
Let’s be clear on the challenge here. There are business applications and then there are business software solutions. Each offers its own challenges and benefits. The distinction is important because a lot of projects fail because the buyer thinks they are implementing a consumer business app when in fact they are implementing a business software solution.
I make the distinction that an “app” is a product that requires minimal configuration. It can be activated and in use within a few hours of the admin user getting their head around the key features and set up requirements. On the other hand, a business software solution requires significant configuration to provide a full solution that is useful to all users.
A good example is to consider setting up a sales CRM on Salesforce. Salesforce provides a 30 day trial of their Professional Edition. If I want to use this for my sales team of 10 people to manage contacts, company lists and opportunity pipeline, I know that I can do this pretty comfortably without support from Salesforce or an integration partner. Sure, I’ll need to do some planning and work with my team to ensure there is good user adoption, but it’s a pretty low risk undertaking.
Alternatively, I might be tasked with implementing Salesforce for my team of 50 sales people and I want to set up integrations and special workflows and reporting to support our current processes. This is a very different undertaking. I am now working on a business software solution. Solutions are inherently more complex than activating “apps”. Some of the key complexities include:
- Number of people and stakeholders involved
- Data integration requirements
- Project scope and variety of data inputs
- Data integrity issues
- Variety of expectations & vested interests
- Impacts on existing processes
With this in mind, ICM implementations are almost always a business solution, not an “app.”
The ICM buyer’s mindset:
When an enterprise embarks on an ICM implementation, they have already struggled with a variety of challenges leading them to select a new solution.
For sales operations and finance teams, the amount of manual effort required to calculate and pay out commissions has become burdensome and costly for the company. For sales reps, they often do not trust the commission payments represented in spreadsheets and resort to shadow accounting.
Finally, executives do not have clear visibility into the value of their commissions program in incenting their sales force and driving revenue for the operation.
A successful buying process will focus on implementing software that will solve for these challenges in stage one.
Stage two should be reserved for the “advanced features” and advanced levels of automation and integration.
Key steps to selection success:
- Restate the goal (reference the business case)
- Define the use cases
- Define the project team & timeline
- Develop a list of vendors
- Issue an RFI
- Use cases to be met by the product
- Security and compliance requirements
- Services
- Pricing
- Shortlist three vendors for detailed demos
- Provide the vendors with a sample data set for the use cases
- Access demo environments to see how the plans were created
- Commercial assessment & contracting
- Licensing
- Implementation fees
- What to look for/ watch out for in the implementation agreement & license term (e.g. don’t sign up for punitive long term agreements that you lock in before you have successfully implemented stage one).
Post selection success- assemble the internal implementation team:
- Project manager
- Subject matter experts
- Super users/ administrators
What to look for in the vendor’s implementation team:
- A graders
- smart people who are tuned in to your requirements
- people who know the product really well
- Agile methodology or at least “wagile”
Summary warnings and top tips for success:
ICM solutions are a long-term investment involving annual or multi-year contracts, deep administrator training and onboarding of internal teams, and an integrated solution with existing ERP, CRM and HRIS systems. Once an ICM solution is implemented, it is not a simple thing to switch providers.
Too much investment has gone in. If an implementation does not go well, an early exit is often not possible because of the sunk costs and internal cost of bringing the solution into the enterprise. If an ICM implementation fails, many times people resort back to spreadsheets to manually fix the issues the ICM software can’t.
So, if you remember a couple of tips from this article, be sure to:
- Make sure each vendor demonstrates their ability to solve your key use cases and problems using your data and your plan rules. You don't need to do a mini implementation, but it needs to be tailored to your requirements, not generic.
- Make sure the winning vendor involves the pre-sales team in the initial kick off of the implementation to make sure the learnings from the pre-sales process are effectively carried over to the implementation.
Parting thoughts as you embark on this journey:
You won’t regret taking the time to invest in the selection process, choose the right technology partner and invest in internal training and adoption. Bringing an ICM solution into your organization will offer tremendous benefits including better visibility into sales commissions for sales reps, managers, and executives.
By automating sales calculations, you reduce the risk of overpayment and free up internal resources for higher-value activities. Communicating sales comp plans will be much easier and provide a better user experience. Finally, executives and managers gain actionable insights by having all your sales compensation data in one place.