The past 15 years have seen dramatic changes in software and technology: leaps from flip phones to smart phones, desktop computing to laptops and tablets, on-premises software to cloud, big data, the Internet of Things, and others. With these new technologies and platforms have come an explosion of software vendors profoundly shifting the information technology and software landscape. As an example, we’ve seen a jump from 1,876 vendors in the marketing space to over 8,000 in just the past five years in marketing technology—not the only industry that has seen this exponential rate of growth. Almost every technology and software segment over the past few years has seen similar growth. However, we are not just seeing a fundamental change in the solutions available; there have also been almost continental shifts in the way organizations acquire new technology and software.
Changes in the Technology Buying Process
Putting it into perspective, you really have to think back to how organizations acquired solutions many years ago vs. today. When it came to technology and software acquisitions, it was completely in the realm of the IT Department. They led the charge with respect to what technology and software an organization would acquire. This meant leading the entire process from vendor evaluation to solution deployment and management. They were also given the annual budget and there was little to no scrutiny over how they spent those funds… What this meant, is that an organization was forced to use whatever solution they acquired, regardless of if they liked it or not. Simply put, the buying process was much more linear back then and a far smoother process.
Today, we are a looking at a dramatically different process, and it starts with line-of-business owners who are now the ones leading the charge with respect to acquiring solutions. They are the ones developing the solution selection criteria, issuing RFPs, and driving the sales process with vendors. When entering the sales process, these buyer-side stakeholders typically come in fully educated with regards to the problem they are looking to solve and how they believe the vendors can help them. But herein lies the problem: unlike their counterparts in the IT department years ago, line-of-business owners are not the only buyer-side participants in the decision-making process. We now have committees composed of IT, financial, and executive teams. Depending on the size of the buying organization, these other stakeholders typically hold great sway over these decisions on solution acquisition. They all care about their own priorities, and only a few of these potentially intersect with line-of-business owners’ needs. Download the research note here: 3Sixty Insights – The Software Technology Decision Making Cycle.