Price Is What You Pay And Value Is What You Receive

You know the drill. You need to evaluate a purchase. You juggle the balance between what you want and what you can afford. The Oracle of Omaha is attributed to the Buffetism, “Price is what you pay, value is what you receive.”

Strategy

WAV Group works with all types of firms to lead vendor selections each year. It starts with strategy: outlining the goals of the purpose. What happens if you buy? What happens if you don’t buy? What does success look like?

Discovery

The next step is discovery. Who are the potential suppliers? Who uses them now? What are the competitors using? How will the purchase shape the hearts and minds of the stakeholders and the company’s services? Will it fit? Are our people capable of managing, training, and supporting the purchase? A lot of this work is to define the target. Discovery is research.

RFI Process

RFI is a request for information. It is a document that outlines what the goals are of the purchase and highlights any known contingencies. It speculates about painkillers, “features you must have,” and the vitamins, or the “features that would be nice to have.” You send the RFI out to the people that your discovery process identified. You invite candidates to learn enough about you so that they can assess the suitability of their product or service to work within the definition of your needs. If they see a fit, they respond by initiating a conversation to learn more details about your needs and to expose their alignment with serving your business.

RFP Process

The RFP Process is not always necessary. In an RFP process, you see the emergence of absurdities like a 500-point feature checklist. Yes, we have these checklists and they are used where necessary to assure our client that they are not missing a vital feature. The bigger question about features is delivered through discovery. It is not a question of how many features. The bigger questions are more stylistic. What features inform your business goals? What are the most important?

I think that in many ways, 500-point checklists have led to complicated software that is so feature-ridden that the key components of the applications get diluted with feature creep and window dressing. In our RFP process, we seek simplicity and elegance. If not – you wind up buying the kitchen sink.

Proposal Review

Whenever you purchase something for your business, there needs to be a champion inside your company. A champion is someone who will stand on the table and advocate for the selection. A champion not only drinks the Kool-Aid, they have the fortitude to evangelize everyone to drink the Kool-Aid.

I go back to the question that I asked earlier – “What happens if we don’t buy it?” Over the past few years – and perhaps a few years too late – every MLS system converted to support mobile. Today, we see every broker website converting to responsive design. Shift happens. Leading companies shift ahead of laggards. Passionate leadership is required for proposal review. We like to find that person that pounds a fist on the table and shouts, “If we don’t do this, I am outta here!”

Contracting

We have written so much about effective contracts. I beg you to please use experts to review your agreements. They serve to protect you. Do not ever sign an agreement without proper review. Plan for the worst, hope for the best. Make sure that you plan your divorce before you get married. We audit company agreements and are terrified by what we find every time. Make contracts a center of excellence in your business practice. Also, be sure to put key dates in the calendars of leadership. It’s painful when contracts automatically renew without a thought.

Planning

If you are replacing something or bringing on something new, create a detailed plan. Make sure that you allocate the resources to implement the purchase effectively.

Communication

As you roll out the new purchase, be sure to communicate loudly and often. Sending everyone an email is not a communication plan for a launch!

Measure

At whatever interval makes sense, go back and measure your success. If the value you sought was not delivered, start over. Reassess the strategy. Restart discovery, and so on.

More than any other consulting firm, we write a lot about best practices. We openly share our process to help our customers identify with the services we provide. At the same time, we are providing our competitors with a roadmap. We don’t care. What we do is a manifestation of our expertise. Having a plan is not the same as executing a plan. The value WAV Group delivers is experience and vision. As the old Chinese proverb goes “Buy the best, you only cry once.”

To view the original article, visit the WAV Group blog.