Scepticism: the technology buyer

There aren’t too many technology equivalents to buying a lemon used car since, for the most part, solutions do eventually work. They may not be the best solution for your company but unlike the lemon, they tend not to leave you stranded on the outskirts of some nowheresville town. Regardless, with millions of budget dollars at stake and potentially more in lost revenues, choosing the right technology solution to address your corporate needs is of paramount importance.

Companies that sell technology can be extremely good at blurring the picture, sometimes intentionally but most often due to the efforts of overly zealous marketing types. Every company is the industry leader with cutting edge technology designed to use its functionality to maximize your mission critical apps.

With all of this thrown at a company, how does it sift through the market-speak and get to the truth, get to the solution that will best help it compete in an increasingly brutal global market? Well, to start off with, a good dose of scepticism helps.

Bill Crago, vice-president service technology with Bell Canada in Toronto sees the market-speak almost every day.

“Each and every vendor that I meet with tells me that they are the market leader in whatever,” he said with a laugh.

“I can hear multiple vendors claim they are leaders in the same category,” he added.

Gary Davenport, vice-president information services with the Hudson’s Bay Company in Toronto, sees the same.

“Everyone plays and everyone claims to have a solution,” he explained.

So to avoid falling into a trap, much like any major consumer purchase, doing your homework and keeping up to date on what is available is extremely important.

Crago likes his fellow employees to keep current, so they attend conferences in order to keep in touch with what is going on in the industry as a whole, he said. They also spend a fair amount of time with key vendors to get a feel where the vendors think the various services and technologies are headed.

Once a decision is made for a technological change, often “developed in our heads or in the context of what we know the company is doing,” Crago asks an employee to go off an figure out what technologies are needed.

“With the Internet…the information is pretty available,” he said.

But the staff member may also go to pertinent conferences and speak to specific vendors. They become almost an industry analyst, though not particularly focused to one area, he said.

And it is much needed.

“Given that they will tell you almost anything to get in, (we) try and determine whether their claims are close,” he explained.

“Usually their claims are close but there is a whole pile of gottchas.”

size does matter

Other large companies like Vancouver-based electronics giant Futureshop Ltd. to some extent rely on their buying power to keep vendors honest.

“[We] are a big account for a lot of people, so…companies want to have a long term relationship with Futureshop,” explained Lori DeCou, manager of corporate communications with Futureshop, in Vancouver.

Over the years the company has developed close relationships with its vendors and suppliers, she said. If there is a more cost effective or compatible solution, “we would hope that the relationship we have with our vendors is such that they would tell us,” she added.

But the threat of lost business does not offer the same leverage for a small company such as online bond traders EBOND Ltd.. Regardless, Lorne Erenberg, president of the Toronto-based company has had positive experiences with his technology vendors.

Last year the company redesigned its Web site. Erenberg brought in experts to cover the firewall, database and Web design issues. Knowing they were adding about 20 per cent new functionality to the site, mostly from customer suggestions, they had an idea of what the cost would be prior to going out looking for a solution.

Yet the prices quoted by the vendors varied dramatically, he said.

“[But] I think that once we narrowed it down to the final three the price wasn’t that far away…they were all similar.”

Having experts on their side also helped the process.

“When we went to most of the companies (technology vendors) we found that they came in and walked us through everything and because we had our consultants, it was a much better feel,” he explained.

He gave specific praise to Oracle Corp. “They had a guy there almost right away when [we] called,” he said. “Some companies are very service oriented.”

Whether your company is big or small there is a need to find that happy medium between what marketing wants and what technology and finance can actually deliver.

“[We] go for the best business arrangement regardless of who offers it, it doesn’t necessarily mean the best technological solution,” Crago said.