The latest and greatest BI and analytics technologies are at the top of many companies' must-have lists. And it is easy to see why-- these tools allow businesses, such as retailers, to gather huge amounts of valuable information to predict customer behavior and increase revenue.
The high demand for these technologies and solutions has, unfortunately, motivated vendors to pursue higher margins by charging higher prices and offering complex terms. Many IT leaders and purchasers may fall prey if they lack the knowledge to secure a good deal.
It is possible to stay within budget on your next purchase -- start with a clear plan and these considerations:
Consider third-party providers
Odds are that a third-party provider will give you better service at a better price. Make sure to weigh all your options carefully before signing on the dotted line.
Remember that ROI has nothing to do with price
Vendors might try to tie the price of your purchase to ROI. Not only are vendor ROI claims usually inflated, they also have nothing to do with price.
Beware of bundled services
You may be tempted to bundle services when vendors offer high discounts. Don't be fooled! These bundles probably include services you don't even need. Before you agree to a bundle deal, figure out which services you will actually need and get the cost for each. You may save money buying them individually.
Beware of fixed fees
Don't be misled by fixed-fee implementation costs. This is a terrible misnomer as the fees are rarely, if ever, "fixed. Always ask vendors to calculate costs based on time and materials. This is the only way to really know true cost-to-serve.
Position your purchase properly
The way you position your next BI/analytics purchase could make all the difference. If done properly, you could save 15-20 percent on the entire purchase. You must have a sound strategy complete with a clear understanding of any goals you wish to achieve with your purchase and how you plan to measure effectiveness. Entering negotiations with these in mind, as well as carefully benchmarked pricing will give you the leverage you need to make a smart purchase.
The high demand for these technologies and solutions has, unfortunately, motivated vendors to pursue higher margins by charging higher prices and offering complex terms. Many IT leaders and purchasers may fall prey if they lack the knowledge to secure a good deal.
It is possible to stay within budget on your next purchase -- start with a clear plan and these considerations:
Consider third-party providers
Odds are that a third-party provider will give you better service at a better price. Make sure to weigh all your options carefully before signing on the dotted line.
Remember that ROI has nothing to do with price
Vendors might try to tie the price of your purchase to ROI. Not only are vendor ROI claims usually inflated, they also have nothing to do with price.
Beware of bundled services
You may be tempted to bundle services when vendors offer high discounts. Don't be fooled! These bundles probably include services you don't even need. Before you agree to a bundle deal, figure out which services you will actually need and get the cost for each. You may save money buying them individually.
Beware of fixed fees
Don't be misled by fixed-fee implementation costs. This is a terrible misnomer as the fees are rarely, if ever, "fixed. Always ask vendors to calculate costs based on time and materials. This is the only way to really know true cost-to-serve.
Position your purchase properly
The way you position your next BI/analytics purchase could make all the difference. If done properly, you could save 15-20 percent on the entire purchase. You must have a sound strategy complete with a clear understanding of any goals you wish to achieve with your purchase and how you plan to measure effectiveness. Entering negotiations with these in mind, as well as carefully benchmarked pricing will give you the leverage you need to make a smart purchase.
About the Author:
Joseph B. Kappernick specializes in helping Fortune 500 companies save money. He recommends that you visit NPI to learn more about IT cost reduction solution service consulting
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