You have to agree that the mirrors in stores are more flattering than the ones at home. How many times have you purchased something at The Gap or JC Penny, which looked great, only to come home and realize it didn’t quite suit you?  You must be wondering, what this has to do with selecting the right technology partner.

While clothes shopping, you have an option to return the item at the store. Luckily, merchants in the consumer world are very forgiving when it comes to our purchases. Unfortunately, the business world is not quite as flexible. We cannot imagine deploying a technology solution and then just “returning” because it did not deliver on the expected results.

PayStream has developed Seven Steps to help you supercharge your vendor evaluation process and help you select the right provider the first time around so you don’t have to deal with the “returns” conundrum:

Building a Business Case: Is there are return on investment and what is the payback period with each solution? The simplest way to compare multiple options – each of which has diverse cost components – is to use the cost per invoice or cost per payment as the least common denominator.

Documenting your Requirements: Before looking for the right technology provider, thoroughly document your requirements - what processes need to be automated and what functionality is needed for that.

Request for Proposals: Use your requirements document to develop a Request for Proposal (RFP), which typically includes three sections – an outline of requirements, a list of questions around the service providers’ capabilities and a section where they can detail their commercial terms based on the assumptions you have provided.

Customer Reference Interviews: Do not underestimate the value in talking to live clients of the vendors that you are considering. Remember that they were yesterday where you are today and can give good tips and pointers in selecting the vendor as well as making the transition process smoother during implementation.

Vendor Score Cards: Develop a set of quantitative and qualitative metrics on which you want to evaluate the vendors’ relative performance in the RFPs as well as onsite presentations and solution demos. Have a number of stake holders rank the providers and aggregate the results.

Contract Negotiation: There is always room for negotiation in the commercial terms submitted by the providers - fixed costs versus variable fees, gain sharing agreements, guarantees and penalties as well as contract termination costs.

Total Cost of Ownership (TCO): The TCO model takes into account three major costs (i) provider fees, (ii) internal IT resource costs and (iii) change management costs.

Finally, don’t forget to consider switching costs – most of which cannot be quite quantified – when evaluating each option.

Until technology buying becomes more like shopping at the mall, PayStream’s QuickStart Consulting program is here to help clients with the comparing and selection process. QuickStart is like your personal shopper for complex automation decisions.

Last 5 posts by Sushmitha Koka

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