A Decision Framework for Software Purchases

10 min read

Most software purchasing decisions take too long, involve too many people, and still end up wrong. The problem isn't that decisions are hard—it's that teams lack a structured process. Here's a framework that actually works.

The Five Questions

Before evaluating any software, answer these questions clearly:

  1. What specific problem are we solving? Not a vague pain point—a concrete, measurable problem. "Our CRM is slow" is vague. "Sales reps spend 2 hours daily on data entry that could be automated" is concrete.
  2. What does success look like? Define the outcome before looking at solutions. If you can't articulate success, you can't evaluate whether software achieves it.
  3. Who will own this? A tool without an owner becomes shelfware. Name the person responsible for implementation, adoption, and ongoing value extraction.
  4. What's the real budget? Include implementation, training, integration, and ongoing costs—not just license fees. If you don't know the real budget, you're not ready to buy.
  5. What's the timeline? When do you need this working? Urgent needs narrow options. Flexible timelines allow more thorough evaluation.

The Evaluation Checklist

Before First Demo
Problem statement documented and agreed
Success metrics defined
Budget approved (including hidden costs)
Decision-makers identified
Deal-breaker requirements listed
During Evaluation
Standardized demo scenarios prepared
All vendors shown same scenarios
Real users participated in evaluation
References checked (not vendor-provided)
Security/compliance reviewed
Before Decision
Total cost of ownership calculated
Implementation plan reviewed
Exit strategy considered
Contract terms negotiated
Owner confirmed and committed

Common Failure Modes

Feature fixation: Choosing based on feature count rather than fit for specific needs. The product with the most features is rarely the right choice.

Demo seduction: Being wowed by polished demos that don't reflect actual usage. Always test with your real scenarios, not vendor scripts.

Committee paralysis: Involving too many stakeholders, leading to endless debate and no decision. Limit decision-makers to 3-5 people maximum.

Sunk cost continuation: Sticking with a bad choice because you've already invested in evaluation. It's cheaper to restart than to implement the wrong solution.

The Decision Meeting

After proper evaluation, the decision should take one meeting. Present the evaluation data. Discuss concerns. Make the call. If you can't decide in one meeting, either your evaluation was incomplete or you have the wrong people in the room.

Document the decision rationale. In six months, when someone asks why you chose this software, you should be able to point to clear reasoning—not "it seemed good at the time."