It’s been 17 years since SI published its first major series on generic insider tips back in 2009 where we gave you a lot of advice that more-or-less still stands today if you want to safely acquire software. In our preamble, we overviewed what those 11 pieces of advice were then, and summarized the 6 major difference that affect how you apply that advice today so you can continue to make the right decisions when acquiring software in the age of AI Hype and exaggerated I2O claims. In the last four parts we addressed the first eight pieces of advice and how they have evolved over the years. Today, we conclude.

Separate software from service

Seventeen years ago we wrote:

Many software products aren’t really software products at all. In other words, there is some incantation that has to be performed by the software vendor, in the form of services, configuration, or other magic, on a regular basis, to keep the software running. In this case, you haven’t bought software, you’ve bought software plus services. What’s even worse is that you’ve single-sourced it. If the vendor goes broke, or can’t deliver, you have no options.

This is still a reality with many products, and, even worse, in the age of AI-based “agentic” offerings, they only keep working if the vendor is constantly monitoring, maintaining, upgrading, retraining, correcting exceptions and errors behind the scenes that you don’t see, etc. There’s more hidden services than ever. That, combined with the escalating token costs, is why they have to sell you on “outcomes” because they can’t charge SaaS fees and survive. (And that’s why outcomes is a dirty word. Just remember freedom of speech means that they can say anything they want, even if it’s not true, but that you have the right to ascertain the truth and demand that word never be used again in their RFP responses! [As well as “AI”.])

Good software is very affordable today. If it’s too expensive, it’s either relying too much on experimental AI that doesn’t work, stuffed full of features you don’t need, or hiding services behind the scenes you don’t want to be paying for.

Monitor the market

This isn’t 20 years ago where there were very few price benchmarks beyond what you could collect from an RFP and a few general price ranges from your favourite consulting firm that were wider than an average football field, this is now where there are dozens of platforms that monitor SaaS spending and a few big consultancies that specialize in not only monitoring and pricing how low a vendor will go, but breaking apart their combined bids into individual SKUS because they have hundreds of data points to compare against as they have been collecting that data for years as they negotiated on behalf of their clients. If you do the research, you should know exactly how much each vendor will charge, on average, for the solution you are looking at for an organization of your size, what the price trends are, when they make the best deals, and what the best pressure points are. If you don’t, you shouldn’t be making major 6, 7, and even 8 (when you consider lifetime) figure software acquisitions. Period. Market monitoring is a must!

Skip the mind games

Abruptly end a meeting mid-stream to make a point? Make the salesman sweat at quarter-end to squeeze a few extra discount points? Scream emotionally that they are price gouging and you’re going to not only report them to the Better Business Bureau but tell all your friends in the local Procurement Association? Threaten to use Klod or Chat J’ai Pété to build it yourself? Lie and say you can make do with your current system for another quarter if you can’t come to a deal or just select any random competitor at DPW?

Sure you could use these techniques to try to get a better deal using an antagonistic wild west negotiation philosophy, but at the end of the day, it will cost you more than you save because even if the rep caves (because the rep knows if he doesn’t close something, he’s the next rep walked out the door by the investors to make a point), how incentivized is the rep, and the vendor as a whole, going to be in helping you to succeed? Especially if their profit margin is close to 0 in a best case situation? Answer: not very. They will do the absolute minimum to meet their contractual requirement, and then take the phone off the hook, tell the chatbot AI to infinitely loop you when you try to contact support, and, when there is an actual bug, make sure you are last in the queue to get serviced, waiting until the last minute of the SLA to do it

Focus on the value you are getting, a price point based on real market data and intelligence that they should be able to match (and make a fair margin while actively supporting you to meet the ROI metrics they promise), and delayed payments until the module is actually live and users actually onboarded before you start paying for it. (In other words, if you buy six modules, but only two are available day one, two more won’t be available for 90 days, and two more for 180 days, you don’t pay the full license fee until all modules are live AND all users set up. And implementation/integration payments are tied to milestone completion.) That’s way more effective.

Now, as always, there are a lot more tips and advice we could give, but these are the biggies. If you want more details, dig deep in the archives. Or, you can contact <font=black>the doctor for an engagement.