Businesses require IT and development services for their operations and business needs. There are tons of IT companies out there claiming to be the best fit for your needs but how close in reality your expectations are met is a big question.
IT, Data Services & Development needs are ever-growing, and businesses require all these services continuously, to not only support and implement their vision but also to stay competitive in 2020 markets, which are defined by high tech products and latest technologies that help them grow.
IT technologies have revolutionized the way of doing businesses and in today’s markets, nothing happens or moves forward an inch without the help of IT (Information Technology).
Latest trends in IT world like Artificial Intelligence (AI), Machine Learning, Robotic Process Automation or RPA, Edge Computing, Virtual Reality and Augmented Reality, Cybersecurity, Blockchain, Internet of Things (IoT), AI as a Service, Personalized and predictive medicine, computer vision & Extended Reality are becoming must-have technologies for many businesses to support their operations and stay relevant in digital markets of this era.
From a simple web development need to most complex databases, ERPs, CRMs, System integrations, APIs development, Business Intelligence, Mobility Solutions, and data transformation needs, etc., there are Tech vendors, which possess a certain skill set to help support, develop and implement your idea or need in place.
A Business IT Needs would mostly revolve around these components. It can be either a software development need or API integration or anything that is linked to services or information be it is data or social streams management. A need can be as simple as designing a basic web application or it can be as complex as integrating different systems and generating a report for a CEO at the top of these systems with the help of a BI tool.
The global information technology industry is likely to reach $5.2 trillion in 2020, according to the research consultancy IDC.
The United States is the largest tech market in the world, representing 32% of the total, or approximately $1.7 trillion for 2020.
These statistics will help you understand the largeness of the IT industry and how quickly it’s beefing up in its size and demand.
According to CompTIA, there is more than 525,000 software and IT Services companies in the United States (approximately 40,500 tech startups were established in 2018 alone).
Keep The Basics In Mind Prior To Evaluating A Tech Vendor
Scope Of Work
It starts with the Scope of Work. But how and who will define the Scope of Work? If you have an in-house IT team, CIO can vet the scope of work. Most of the medium to large scale businesses have in-house tech teams being led by a Chief Information Officer or at a lower scale by an IT Manager. A business need can be complex in nature.
A well thought and well-written Scope of Work demands super attention of your tech and business team. Once the Scope of Work is internally finalized it is time to engage local or global tech vendors basing on your current need.
Brainstorming the Scope of work with Tech Vendors will open up new horizons and they can help you identify any missing components or suggest something better or more cost-effective way to achieve the end goal.
The two parties must spend a good time on this part as this defines the entire project’s success.
Your selection of vendors to work on this initial step of defining the Scope of Work must be based on certain criteria. You should find out for how long the vendor has been in the market for, collection of references for their past and most recent works in the same domain as yours, the financial strength of the vendor, team composition, CVs of the team members who might work with you, etc. All these are important aspects of choosing a vendor who can potentially brainstorm the Scope of Work with you. Many businesses or companies go out in the market in haste and try to select a vendor quickly, this can jeopardize the success of your project.
Request for Proposal: Scope of Work can be defined in the RFP document. Once the Scope is finalized it is good to formulate the RFP document. It plays the role of witness document to the Scope of Work.
Functional Specifications Document: You should request your vendor to formulate a Functional Specifications Document for your Scope of Work. A functional specification in software development is a document that specifies the functions that a system or component must perform. The documentation typically describes what is needed by the system user as well as requested properties of inputs and outputs.
The best way to allocate a budget for your project is to first brainstorm your ‘Idea/Scope of Work’ with your chosen tech vendors. The tech vendors will share with you a detailed breakdown of the number of resources, respective hourly rates, and timelines needed to complete the work. You can cross verify the timelines and ballpark estimates. This exercise will help you avoid over or under budgeting your IT project. Budgeting is critical and is primarily linked to your Scope of Work and timelines. Aggressive timelines may incur you more billing as tech vendors have to increase the number of resources to complete a task within a limited time frame.
The sky is the limit. In IT projects you got to secure a vendor whose costs are reasonably justified, and not only costs are justified but also can deliver the agreed Scope of Work within the quoted costs. It is important to note that sometimes tech vendors can be desperate to attain a new project, they might lower their costs to get the work, it might look lucrative to you to assign the work to a low-cost vendor but you need to seriously consider running your mathematics. Can it be delivered at this price? Is it too good to be true? All this will help you avoid later surprises and guarantee you a successful delivery.
Hiring a freelancer for an image design or logo design or a simple webpage may be a good idea for a small business. But for complex projects avoid freelancers. This is the most fatal mistake any business can make. Freelancers are usually online whom you can find on Upwork or Guru or other job portals. These freelancers can be good for a smaller piece of work but to utilize them for bigger projects is a big mistake.
In general, you have less control over the scattered team and there is no one to hold accountable for missing deadlines.
The best approach is to work with tech vendors with proper running corporations. This ensures the delivery of a project. Tech vendors have dedicated teams with certain skill sets that are needed to make a project a success and the responsibility is shifted to a tech vendor to deliver the scope of work. It gives you peace of mind and you will be dealing with professionals who are hired to do your job.
Verification Of Tech Team’s Skill Set
It is important for you to look into the skill set of the team that is going to work on your project or any IT needs of your business. Simply request for the team CVs and go through the CVs and their respective roles in your project. You should question their skill set and compare it across different vendors. A seasoned team is needed to ensure your project success. You can request for certain certifications that are relevant to your job.
Project Managers at Both Ends
Many of the IT projects fail because of the communication gap between the two parties. A good project manager may cost both parties but it’s worth considering. Good delivery requires smooth and timely communication. This happens when both ends are being led by seasoned Project Managers. At the time of selecting a Tech Vendor, it is important you request for the credentials of a Project Manager who will be running the show at your vendor side. PM selection is another important aspect that you should take into consideration.
Skin in the Game
A tech vendor shall have its skin in the game. Formulate contracts and agreements in a way where there are reasonable plenty clauses. This will ensure you some sort of control in the equation. Penalizing for a Missing deadline or payment release upon an approved milestone seems to be small measures but they actually help.
Collection of References
As simple as it sounds this step is significantly important. Ask for at least three to four references in the same sort of work that you are to award to a tech vendor. Companies do not spend enough time on this. They tend to do this step at the time of awarding a contract, whereas this step should be done at the beginning of any engagement. The most common mistake is where CIOs or IT Managers or CEOs leave this to the end. Speak in as much detail as you can with the given references.
It matters to work with tech vendors who you can meet in person. In-person meetings have a great impact on any project. Yes, many development and services work can be done remotely but there will always be a need for in-person meetings. You feel more in control of the situation and it gives you more confidence to better drive things.
An IT, tech, or development need can be of any nature. With millions of tech vendors out there it is difficult to select the right tech vendor for your business need. If the basics are kept intact and are exercised at the time of selecting a tech vendor, there is a greater probability that you will end up selecting a Right Valuable Tech Partner.
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