“Why did you ask for a Rolls Royce CRM when you could only afford a Kia?”
This was a question I asked a Not for Profit recently after they told me about their failed CRM procurement process. They spent months documenting their requirements with a consultant only to find that they couldn’t afford any of the solutions.
“We didn’t know we were asking for a Rolls Royce CRM,” they answered.
They are not alone. I know of several Not for Profits who have chosen a traditional, bottom-up approach to procuring CRMs and other systems, only to find that the effort resulted in vendor proposals outside their budget – a Rolls Royce CRM.
I was in their shoes.
I remember the days when I had similar challenges.
My first “real job” was as a procurement officer for the US Air Force. Depending on the complexity of the requirements, we could sometimes spend a year or more putting together procurement documents.
When the vendor proposals came into the Tender Box on the closing day, we would eagerly grab the documents and turn to the price page with our fingers crossed.
“Were the proposals within our estimated budget?”
When you’re dealing with price proposals with 7, 8, or sometimes 9 zeros, our contingency bucket allows for a customised solution and a wide variance in our budget.
But as a Not for Profit, the budget is often quite restrictive. For this reason, I do NOT recommend a traditional procurement process for selecting new IT systems like a CRM.
What’s a traditional procurement process?
A traditional procurement process usually starts with documenting detailed requirements you may have for a system. I’ve seen it written down to the lowest process level.
These requirements are then prepared in a formal document, sometimes called an RFT (Request for Tender), RFP (Request for Proposal) or RFQ (Request for Quote) and sent to a short-list of vendors.
Vendors will respond to this request and send a proposal with indicative pricing based on the requirements.
The problem with this approach is that you are trying to get vendors to modify their systems to comply with your processes, which can cost a fortune to implement and maintain.
From my experience, there’s a much better approach when you have a limited budget.
How NOT to select a Rolls Royce CRM
The better approach to avoiding a Rolls Royce CRM or any system is to identify which vendors already meet most of your high-level requirements out of the box.
Rather than having them conform to your way of doing things, the intention is to adopt the vendor’s way as much as possible. Why would you do this?
- A system with minimum customisations is cheaper to purchase and maintain over time.
- The out-of-the-box system is less likely to break when there are software updates.
- Vendors work with a lot of clients similar to your organisation and, therefore, have already embedded best practices processes and workflows into their system.
While you may still have unique requirements that need to be considered in the system design, this should be as minimal as possible.
So, the trick to a better procurement process is understanding what solutions in the marketplace can meet most of your needs.
I regularly help Not for Profits select a CRM and other systems. Let me know if you need some help.
P.S. If you found this article helpful, you might want to read this one too:
- Why the greatest CRM could still fail to meet your needs.
- What’s the cost of a new CRM?
- When should you use an RFT process to procure IT?
Tammy Ven Dange is a former charity CEO, Association President, Not for Profit Board Member and IT Executive. Today she helps NFPs with strategic IT decisions, especially around investments.
