Contact us
Contact us
VENDOR SELECTION

A structured approach to successful vendor selection

When it comes to introducing new technology into an organisation, selecting the right vendor can make or break the eventual outcome. The sheer amount of choice, variation in technical specs and complex pricing structures presented by vendors can be overwhelming, and that’s before you start watching demos and wading through proposals.  

What you need is a structured approach from the get-go.  

Emily Fitz-Hugh, from regulatory and financial crime transformation experts BeyondFS, explains how to streamline your process, eliminate risks, and save your business time and money. 

 

Stop wasting time: Why structured vendor selection matters

A new technology solution is invariably a major investment for financial institutions, yet many projects are initiated in an exploratory style with only the fuzziest conception of priorities, scope and objectives, and still less idea of the quantifiable benefits expected from a new software platform.  

The result can be weeks or even months wasted on unstructured conversations and demos which don’t provide sufficient knowledge to make a clear, informed and objective decision to select the right vendor.  

Eventually, a formal project structure is introduced, often requiring the entire exploratory phase to be scrapped and restarted. A structured approach from the outset avoids this mistake. It ensures fair evaluation of competing solutions and vendors, minimise risks, optimise costs and timelines, and ultimately is more likely to lead to a successful implementation and a lasting partnership. 

Let’s take a closer look at a structured approach which clearly defines and aligns your requirements from the outset.  

A structured approach to successful vendor selection
A structured approach to successful vendor selection
1.
Get your requirements right early on

Before reaching out to vendors, define your requirements internally, engaging relevant stakeholders and experts across your organisation. This may be onerous but is the most important thing you can do to save time and money in the long run. It guarantees that everyone is aware of the vision, and aligned on what the new system should do.  

Agreeing your requirements at the outset will ensure that the preferred vendor aligns with your organisation’s strategic goals. It will also avoid the need for reconfiguration when you move into the implementation phase of the project.  

What do you want the world to look like once your new software or platform is in place? How will your processes work? What does that mean for your data, your reporting, for customers and employees that are affected? Ask your IT, Legal, and other impacted teams so that you can ensure alignment. 

As a rule of thumb, start by identifying approximately 15 priority requirements and ask vendors to address these in initial demos before inviting them to participate in the formal tender process. This way you can swiftly eliminate vendors who don’t meet your critical requirements.  

2.
Eliminate risks through objective evaluation

To evaluate potential vendors effectively you’ll need to create a scoring methodology based on your defined requirements. Assign a weighting to each requirement according to its importance for your business. Your decision criteria should be agreed and validated with all key decision makers before sending out an RFP (Request for Proposal) to potential vendors. This minimises biases and promotes transparency, leading to an objective selection process overall. If a vendor fails to meet multiple requirements, remove them from consideration to reduce the likelihood that their solution could cause operational disruptions, legal issues, or integration challenges. 

Narrow down your vendor shortlist to 2-3 options early on. Fewer choices make it easier to compare and agree on selection criteria with internal stakeholders. 

3.
Playback

Ensure that the vendors understand your requirements and invite them to ask any follow-up questions. Next, it’s their turn to play back your requirements to you. Ask them to explain in detail how they can meet all your requirements using their platform.  

This playback step is vital. Vendors want to win your business, and are usually eager to confirm that they can easily meet your requirements. If their explanations leave you less than 100% convinced, probe deeper into the detail until you are confident that they can or cannot meet the requirement.  

This will avoid disappointment and time wasted on customisation further down the line 

4.
Bring everyone on the journey

Make sure you get everyone on board with the project’s approach and any responsibilities they might have - internal stakeholders, wider teams, and even the vendor – by keeping them informed throughout the process with clear signposts. Transparency creates trust and accelerates decision-making. 

For demos and requirement responses, use simple scorecards to summarise results. This demonstrates the objectivity of the process, and makes it easy to present your findings to leadership. 

With these steps, you'll be well on your way to securing a vendor who aligns with your goals, and implementing a solution that delivers real value to your organisation. 

How can BeyondFS help?

BeyondFS has helped many financial institutions with their end-to-end vendor selection, implementing new technologies and automation successfully in complex scenarios, across multiple business units, corporate entities and international jurisdictions. 

  • We can provide the methodologies, artifacts and templates required to perform vendor selection and manage the whole process (including RFP) 
  • We can help understand business needs and technical requirements to support the definition and documentation of system requirements and specifications 
  • We can rapidly research available vendors and facilitate vendor shortlisting 
  • We can provide negotiation support 

If you would like help with vendor selection, or another aspect of technology implementation, just reach out to us. 

Let's make change happen.

We help Financial Institutions accelerate digital transformation – delivering improved efficiencies, better risk controls and enhanced customer experiences.