Use This Tool to Ensure Your Next Software Purchase Isn’t a Costly Mistake

Software investment decisions can get expensive. One wrong step and you risk losing not only the money incurred on the software purchase but also the time spent on training and implementation. Choosing a tool that ultimately doesn’t work for you can even impact critical business functions and hurt productivity.

With stakes this high, it’s important to identify potential pitfalls before buying any software. That’s why we’ve created an assessment tool that calculates the level of investment risk associated with purchasing a new software. We’ve also provided recommendations and best practices to follow based on your identified risk level. 

But first, let’s go over the factors assessed by the tool and why they’re important in determining the value-add of a potential software purchase.

1. Data security

Data security is one of the most important considerations when selecting software. Data security breaches can not only result in penalties from government authorities but can also damage your brand reputation and lead to loss of customer trust. This parameter becomes more crucial if the software you’ve chosen requires access to sensitive business data, such as financial and employee records. 

2. Pricing agreements

The types of payment plans offered are another factor to take into account when committing to a new software. For instance, if you’ve opted for an annual subscription but later realize that the software isn’t a perfect fit, you risk losing the money you’ve paid upfront. 

3. Training and implementation

Software training and implementation requires significant time and effort. A well-defined training plan ensures that every team member gets hands-on experience with the software and learns all the required features. This kind of thoughtful onboarding requires time and resources that your business can’t afford to waste. 

4. Impact on critical business functions

When a software purchase fails to meet your needs, this can have a huge impact on critical business functions. For instance, choosing the wrong ERP system can put core manufacturing and supply chain processes at risk and even lead to business losses. The more integral this software will be to your tech stack, the more you run the risk of a poor purchase causing slowdowns in your business. 

Based on the factors discussed above, you’ll be asked to input data about the software you’re considering and our risk assessment tool will determine how risky this potential investment is for your business. The tool measures risk using three tiers: Low, Medium, and High. 

There is a set of predetermined responses for each question. To select the one that best aligns with your circumstances, click the arrow on each row of the tool to access the answer dropdown. Once you select your answers, the tool will automatically score your investment risk level. 

To get the most accurate assessment report possible, here’s what you should be thinking about when selecting your answer choices. 

A screenshot of GetApp’s Investment Risk Assessment Tool

Which pricing model are you planning to select?

Most cloud-based software solutions have subscription-style monthly and annual pricing plans. However, with on-premise software, there’s typically a one-time software licensing cost. Based on the pricing model you’re planning to adopt, select “Monthly”, “Annual”, or “One-Time License” on the assessment tool.

How expensive is the software?

Comparing the price of a product against your budget helps assess how big of a bite it is. If the software costs more than 80% of your budget, select “Pricey”; less than 60%, select “Economical''; and somewhere between 60% to 80%, select “Mid-range”.

What percentage of your workforce will use the software?

In this question, you’ll need to determine how many individuals (as a %) in your organization will require the software to do their jobs. An exact percentage isn’t required; a logical estimate will be sufficient. Select the percentage range that best represents this number in the assessment tool.

Will the software store sensitive business data? 

To answer this question, determine which of your business data is considered “critical” vs. “non-critical.” If the software will store and require access to critical data, select “Yes” on the assessment sheet. If you’re unclear as to what type of data the software will handle, make sure to clarify this with the software vendor.

Does the vendor offer free migration assistance?

Another important thing to double-check is if the vendor offers migration support in case you decide to move to a new system. This will ensure that you don’t get locked into any one software due to compatibility issues between vendors. It’s also important to specify if the support service is free or if you’ll need to pay for it. Select an answer in the assessment tool accordingly.

Can failure of the software paralyze critical operations for your business?

Identify how essential this software will be for your day-to-day operations. If this solution fails to meet your expectations, what is the potential impact on your business? Based on your evaluation, select a suitable answer on the assessment tool. If in doubt, product demos are a great time to discuss these risks with the software vendor.

On a scale of 1 to 5 (1 being the lowest), how would you rate the technical know-how of your IT staff?

In this question, you’ll have to determine the technical expertise of your IT staff in troubleshooting software issues and determining vulnerabilities. A 1 represents the lowest level of technical expertise and a 5 is the highest. You can select “We don’t have technical staff” if your business doesn’t have a dedicated IT team.

How much time will it take to onboard new users?

Determine roughly how much time is needed to train new users on the core software features. Once finished, your team should be able to use this software to perform their duties without slowdowns. The vendor should be able to help provide an estimate on the time needed for onboarding your team. Select a relevant answer on the assessment tool.

Does the software vendor encrypt data?

Verify if your data will be encrypted on the software vendors’ servers. Encryption will protect your business data from malware and breaches. Select “Yes” or “No” based on your findings.

You’ve provided your answers and the tool assigned you with a predicted level of investment risk for the software you’re considering: Low, Medium, or High. Let’s discuss what your risk level means for your business and how you should proceed.

Your investment risk level is Low

A low risk level means that your decision to invest in the software likely won’t have much impact on your core business or involve any potentially pricey pivots. It also indicates that if you need to switch software, you’ll face minimal challenges. That said, you should still carefully consider the factors above when making a purchase. Visit GetApp to evaluate and compare software and read user reviews from businesses like yours.

Your investment risk level is Medium

A medium risk level suggests that you should probably take another look before you invest in the potential product, as its failure has a good chance of impacting performance and productivity or a necessary switch could get expensive. Before making a decision, re-evaluate the factors that caused your investment risk to spike. Perhaps you commit to monthly payments before going for the annual subscription. Or test drive a few features before upgrading to a more advanced plan.

Either way, make sure to perform due diligence and ask the vendor for case studies from users in your line of operation/industry to weigh the pros and cons of the product. If you haven’t already, see what GetApp users have to say about how the software served their needs.

Your investment risk level is High

A high risk level suggests that the product in question could have serious implications for your business, and in the unfortunate event of software failure, critical business functions and profitability are highly likely to be impacted. If you wish to move forward with this product, you’ll need to proceed with caution. 

Attend multiple vendor demos and ask for a free trial or sand-box version of the software before deciding to invest. Instead of implementing the software across processes, use a phased approach. Start with a few functions and decide on expansion based on the success of the previous phase. 

You can also choose to upskill your IT staff or expand in-house technical capabilities by hiring more talent. You can even opt for the vendor’s support services or hire an implementation consultant to get expert advice. We recommend comparing at least two other products before finalizing this software purchase.

Visit GetApp’s software directory to find top-rated software alternatives. Click the “compare” button on any software vendor page in GetApp’s catalog to see how your proposed software stacks up against the competition. You can also read user reviews to understand the experience real buyers have had with the software you’ve selected.