Required Inputs
- System Type: Category of system being selected (ERP, CRM, HRIS, data platform, etc.).
- Business Context: Why this selection is happening (new implementation, replacement, consolidation).
- Stakeholder Map: Key decision-makers, influencers, and end users.
- Budget Range: Capital and operating budget constraints.
- Timeline: Decision timeline and target go-live date.
- Constraints: Mandatory requirements, regulatory needs, integration dependencies, preferred vendors.
Execution Steps
1. Requirements Gathering
Gather requirements across four categories. Each requirement is rated by priority and assigned a stakeholder owner.
Requirement Priority Classification:
| Priority | Label | Definition | Scoring Impact |
|---|---|---|---|
| P1 | Must Have | Non-negotiable; vendor fails without it | Eliminatory -- vendor disqualified if unmet |
| P2 | Should Have | Important; significant impact on success | High weight in scoring (3x multiplier) |
| P3 | Nice to Have | Desirable; adds value but not essential | Standard weight in scoring (1x multiplier) |
| P4 | Future | Not needed now but anticipated within 2 years | Low weight (0.5x multiplier) |
Functional Requirements Template:
| ID | Requirement | Description | Priority | Stakeholder | Source |
|---|---|---|---|---|---|
| FR-001 | P1/P2/P3/P4 |
Categories to cover:
- Functional: Business capabilities, workflows, reporting, user experience
- Technical: Architecture, APIs, security, performance, scalability, data model
- Integration: Systems to connect, data flows, real-time vs batch, middleware
- Non-Functional: Availability SLA, response time, data residency, accessibility, compliance
Requirements Discovery Methods:
- Stakeholder interviews (1:1 with decision-makers and power users)
- Process mapping workshops (current state and desired future state)
- Pain point analysis (top 10 issues with current system)
- Data flow analysis (what data moves between systems)
- Regulatory review (compliance requirements that constrain selection)
2. Build vs. Buy vs. Configure Decision
Before evaluating vendors, determine if buying is the right approach.
Decision Scorecard:
| Factor | Weight | Build (Custom) | Buy (SaaS/License) | Configure (Low-Code/Platform) | Score |
|---|---|---|---|---|---|
| Strategic differentiation | 15% | 5: Full control, unique IP | 1: Same as competitors | 3: Moderate customization | |
| Time to value | 15% | 1: 12-24 months | 5: 1-6 months | 4: 3-9 months | |
| Total cost (5 year) | 15% | Variable, often underestimated | Predictable licensing | Moderate, platform fees | |
| Maintenance burden | 10% | 5: Full ownership | 1: Vendor managed | 3: Shared responsibility | |
| Talent availability | 10% | Specialized skills required | Lower barrier | Platform-specific skills | |
| Vendor/platform risk | 10% | None | Lock-in, viability risk | Platform dependency | |
| Scalability | 10% | Depends on architecture | Vendor-managed scaling | Platform-dependent | |
| Integration flexibility | 10% | Full control | API-dependent | Platform ecosystem | |
| Regulatory compliance | 5% | Full control | Vendor certification | Platform certification | |
| Weighted Total | 100% |
Decision Threshold:
- Build score > Buy by 20%+: Proceed with build (validate with CTO/CIO)
- Scores within 20%: Default to buy unless strong strategic differentiation argument
- Buy score > Build: Proceed with vendor evaluation (below)
3. Market Landscape Analysis
Vendor Universe Mapping:
| Tier | Description | Example Criteria | Typical Count |
|---|---|---|---|
| Leaders | Established, broad capability, large customer base | Gartner MQ leaders, >$1B revenue | 3-5 |
| Challengers | Strong product, growing market share | Strong product reviews, fast growth | 3-5 |
| Niche Players | Specialized by industry, size, or function | Deep domain fit, innovative features | 5-10 |
| Emerging | New entrants, modern architecture, disruptive pricing | Cloud-native, AI-first, <3 years in market | 3-5 |
Research Sources:
- Analyst reports: Gartner Magic Quadrant, Forrester Wave, IDC MarketScape
- Peer reviews: G2, Capterra, TrustRadius (filter for similar company size/industry)
- Industry references: Peer company implementations, conference case studies
- Vendor briefings: Analyst inquiry, vendor-provided materials
4. Long List to Short List Reduction
Stage Gate Process:
| Stage | Input | Criteria | Output |
|---|---|---|---|
| Universe | All known vendors | Market presence in category | 15-25 vendors |
| Long List | Universe filtered | Meets P1 requirements (desk research) | 8-12 vendors |
| RFI Response | Long list vendors | Detailed capability match, pricing range | 5-8 vendors |
| Short List | RFI respondents | Weighted scoring threshold (>70%) | 3-5 vendors |
| Final Demo | Short list vendors | Full evaluation with stakeholders | 2-3 vendors |
| Selection | Finalists | Final scoring, negotiation, reference checks | 1 vendor |
Long List Elimination Criteria (any = disqualify):
- Does not meet any P1 requirement
- No presence in target geography/market
- Company size mismatch (too small = risk, too large = priority risk)
- No relevant industry references
- Technology architecture fundamentally incompatible
- Pricing model misaligned with budget range
5. RFP/RFI Template Structure
RFP Document Outline:
| Section | Content | Page Guidance |
|---|---|---|
| 1. Company Overview | About the buying organization, strategic context | 1-2 pages |
| 2. Project Scope | System scope, users, geographies, timeline | 2-3 pages |
| 3. Current State | Existing systems, integrations, pain points | 1-2 pages |
| 4. Requirements | Functional, technical, integration, non-functional (reference matrix) | 10-20 pages |
| 5. Vendor Information | Company background, financials, references, roadmap | 2-3 pages |
| 6. Implementation Approach | Methodology, team, timeline, change management | 3-5 pages |
| 7. Pricing | License/subscription, implementation, ongoing costs (use TCO template) | 2-3 pages |
| 8. Security & Compliance | Certifications, data handling, audit reports | 2-3 pages |
| 9. SLA & Support | Uptime SLA, support tiers, escalation, maintenance windows | 1-2 pages |
| 10. Evaluation Criteria | Scoring methodology (transparent to vendors) | 1 page |
| 11. Response Instructions | Format, deadline, Q&A process, contact | 1 page |
RFP Requirements Response Format:
| Req ID | Requirement | Priority | Response Options |
|---|---|---|---|
| FR-001 | [Description] | P1 | Fully Supported / Supported with Configuration / Supported with Customization / Roadmap (date) / Not Supported |
6. Weighted Scoring Framework
Scoring Category Weights (adjustable by stakeholder priorities):
| Category | Default Weight | Range | Key Stakeholder |
|---|---|---|---|
| Functional Fit | 30% | 25-40% | Business owners, end users |
| Technical Fit | 20% | 15-25% | IT/Engineering |
| Vendor Viability | 15% | 10-20% | Procurement, executive sponsor |
| Cost (TCO) | 15% | 10-20% | Finance, procurement |
| Implementation Risk | 10% | 5-15% | PMO, IT |
| Innovation & Roadmap | 10% | 5-15% | CTO/CIO, product |
| Total | 100% |
Detailed Scoring Rubric (apply consistently across all vendors):
| Score | Label | Definition |
|---|---|---|
| 5 | Exceptional | Exceeds requirement; best-in-class capability demonstrated |
| 4 | Strong | Fully meets requirement with proven capability |
| 3 | Adequate | Meets requirement with minor gaps or workarounds |
| 2 | Partial | Partially meets requirement; significant customization needed |
| 1 | Weak | Barely addresses requirement; major gaps |
| 0 | Fail | Does not meet requirement (eliminatory for P1 items) |
Scoring Matrix Template:
| Category | Sub-Criteria | Weight | Vendor A | Vendor B | Vendor C |
|---|---|---|---|---|---|
| Functional Fit (30%) | |||||
| Core functionality coverage | 10% | ||||
| Workflow/process alignment | 8% | ||||
| Reporting & analytics | 6% | ||||
| User experience | 6% | ||||
| Technical Fit (20%) | |||||
| Architecture & scalability | 6% | ||||
| Security & compliance | 6% | ||||
| Integration capabilities | 5% | ||||
| Performance | 3% | ||||
| Vendor Viability (15%) | |||||
| Financial stability | 5% | ||||
| Market position & trajectory | 4% | ||||
| Customer references | 3% | ||||
| Partner ecosystem | 3% | ||||
| Cost / TCO (15%) | |||||
| 5-year TCO | 10% | ||||
| Pricing model flexibility | 5% | ||||
| Implementation Risk (10%) | |||||
| Implementation complexity | 4% | ||||
| Vendor implementation capability | 3% | ||||
| Data migration risk | 3% | ||||
| Innovation (10%) | |||||
| Product roadmap alignment | 5% | ||||
| AI/automation capabilities | 3% | ||||
| Technology modernity | 2% | ||||
| TOTAL | 100% | /5.0 | /5.0 | /5.0 |
7. Vendor Demo Evaluation Scorecard
Demo Structure (require from all vendors):
| Segment | Duration | Content | Evaluators |
|---|---|---|---|
| Company & vision | 15 min | Vendor strategy, roadmap, relevant experience | Executive sponsor |
| Core scenario 1 | 30 min | Primary business workflow (scripted) | Business users |
| Core scenario 2 | 30 min | Secondary business workflow (scripted) | Business users |
| Integration demo | 15 min | Live integration with key systems | IT/Engineering |
| Administration | 15 min | Configuration, security, user management | IT/Engineering |
| Q&A | 15 min | Open questions from evaluation team | All |
Demo Evaluation Form (per evaluator):
| Criteria | Weight | Score (1-5) | Notes |
|---|---|---|---|
| Scenario completion (did it work?) | 25% | ||
| Ease of use / UX quality | 20% | ||
| Data handling and reporting | 15% | ||
| Configurability (no custom code) | 15% | ||
| Integration capability demonstrated | 10% | ||
| Presenter knowledge and credibility | 10% | ||
| Innovation / "wow factor" | 5% | ||
| Weighted Score | 100% | /5.0 |
8. Reference Check Methodology
Reference Selection Rules:
- Require 3-5 references per short-listed vendor
- At least 1 reference in same industry
- At least 1 reference of similar company size
- At least 1 reference that went live within last 18 months
- Request references the vendor did NOT pre-select (ask for full customer list)
Reference Check Question Bank:
| Category | Questions |
|---|---|
| Implementation | How long did implementation take vs. plan? What was the biggest surprise? Would you use the same implementation partner again? |
| Functionality | What works well? What are the top 3 gaps or workarounds? How does reporting meet your needs? |
| Performance | Any performance issues at scale? Uptime experience vs. SLA? |
| Support | How responsive is vendor support? How are bugs and enhancement requests handled? |
| Cost | Did total cost match proposal? Any unexpected costs? How have renewal negotiations gone? |
| Integration | How well does the system integrate? API quality and documentation? |
| Satisfaction | Net Promoter Score (0-10)? Would you choose this vendor again? What would you do differently? |
9. Total Cost of Ownership (TCO) Model
5-Year TCO Template:
| Cost Category | Year 0 (Impl) | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Total |
|---|---|---|---|---|---|---|---|
| Software Costs | |||||||
| License / subscription fees | |||||||
| User licenses (per seat) | |||||||
| Module / add-on fees | |||||||
| API / integration fees | |||||||
| Storage / compute overage | |||||||
| Implementation Costs | |||||||
| Vendor professional services | |||||||
| SI / implementation partner | |||||||
| Data migration | |||||||
| Custom development | |||||||
| Testing and QA | |||||||
| Internal Costs | |||||||
| Internal project team (FTE x months) | |||||||
| Business user time (training, UAT) | |||||||
| IT support team allocation | |||||||
| Change Management | |||||||
| Training development and delivery | |||||||
| Change management program | |||||||
| Productivity loss during transition | |||||||
| Ongoing Costs | |||||||
| Annual maintenance / support | |||||||
| Managed services / admin | |||||||
| Enhancements / releases | |||||||
| Infrastructure (if on-prem) | |||||||
| Risk Contingency (10-20%) | |||||||
| TOTAL | $[X] |
TCO Comparison Normalization:
- Convert all pricing to same term (monthly/annual)
- Normalize user counts to same projected growth
- Include contractual escalators (annual price increases)
- NPV calculation at company's discount rate for multi-year comparison
NPV of TCO = Sum of (Annual Cost_t / (1 + discount_rate)^t) for t = 0 to 5
Cost per User per Month = 5-Year TCO / (Average User Count x 60 months)
10. Implementation Risk Assessment
Risk Assessment per Vendor:
| Risk Factor | Weight | Assessment Criteria | Vendor A | Vendor B | Vendor C |
|---|---|---|---|---|---|
| Implementation complexity | 20% | # of integrations, data migration volume, customizations | |||
| Vendor implementation track record | 20% | On-time %, reference satisfaction, methodology maturity | |||
| Data migration risk | 15% | Data volume, quality, mapping complexity, downtime tolerance | |||
| Organizational readiness | 15% | Change magnitude, executive support, user buy-in | |||
| Integration risk | 15% | API maturity, middleware needs, real-time requirements | |||
| Timeline feasibility | 15% | Vendor capacity, internal resource availability, dependencies | |||
| Weighted Risk Score | 100% | Lower = less risky | /5.0 | /5.0 | /5.0 |
11. Contract Negotiation Key Terms
Critical Contract Terms Checklist:
| Term | What to Negotiate | Acceptable / Watch Out |
|---|---|---|
| Pricing protections | Annual increase cap, volume discount tiers, MFN clause | Cap at 3-5%; avoid uncapped CPI adjustments |
| SLA and penalties | Uptime guarantee, response times, credit mechanism | 99.9%+ uptime; meaningful credits (5-10% of monthly fee) |
| Data ownership | Data portability, export formats, deletion on termination | You own all data; vendor provides full export at no cost |
| Termination rights | Convenience termination, cause termination, transition period | 90-day notice; 6-12 month transition assistance |
| Liability cap | Vendor liability for data breach, downtime, errors | Minimum 2x annual fees; carve-outs for IP infringement, data breach |
| Implementation guarantees | Fixed price or cap, milestone payments, warranty period | Milestone-based payments; 90-day warranty post go-live |
| IP rights | Ownership of customizations, configurations, integrations | You own all custom code; vendor retains core product IP |
| Escrow | Source code escrow for vendor insolvency | Required for critical systems; annual verification |
| Compliance | Audit rights, certification maintenance, breach notification | Annual SOC 2; 24-hour breach notification |
| Renewal terms | Auto-renewal notice period, renewal pricing | 90-day opt-out; renewal at current published rates or negotiated cap |
12. Decision Presentation Template
Steering Committee Decision Pack Structure:
| Section | Content | Slides |
|---|---|---|
| Executive Summary | Recommendation, key rationale, investment required | 1 |
| Process Overview | Methodology, timeline, participants, vendors evaluated | 1 |
| Requirements Summary | Key requirements, prioritization, stakeholder alignment | 1 |
| Vendor Comparison | Scoring summary, strengths/weaknesses, key differentiators | 2-3 |
| TCO Comparison | 5-year cost comparison, NPV, cost per user | 1 |
| Risk Assessment | Implementation risk by vendor, mitigation plans | 1 |
| Reference Insights | Key findings from reference checks | 1 |
| Recommendation | Recommended vendor with top 3 reasons, second choice | 1 |
| Implementation Plan | High-level timeline, resource needs, key milestones | 1 |
| Decision Required | Specific ask, approval needed, next steps | 1 |
Output Template
# System Selection: [System Type] for [Organization]
**Prepared for**: [Steering Committee] | **Date**: [Date] | **Decision Required By**: [Date]
## Executive Summary
**Recommendation**: [Vendor Name]
**Confidence Level**: [High / Medium / Low]
[3-5 sentence summary: why this system is being selected, the recommended vendor,
key differentiators, and total investment required.]
### Selection at a Glance
| Criterion | Vendor A | Vendor B | Vendor C |
|---|---|---|---|
| Weighted Score | X.X/5.0 | X.X/5.0 | X.X/5.0 |
| 5-Year TCO | $[X]M | $[X]M | $[X]M |
| Implementation Risk | Low/Med/High | Low/Med/High | Low/Med/High |
| Go-Live Timeline | X months | X months | X months |
## 1. Requirements Summary
**Total Requirements**: [X] (P1: [X] | P2: [X] | P3: [X] | P4: [X])
[Key requirements highlights]
## 2. Build vs. Buy Decision
**Decision**: [Build / Buy / Configure]
[Scoring summary and rationale]
## 3. Market Landscape
[Vendor universe, long list, and short list progression]
## 4. Detailed Vendor Scoring
### Scoring Summary
| Category (Weight) | Vendor A | Vendor B | Vendor C |
|---|---|---|---|
| Functional Fit (30%) | X.X | X.X | X.X |
| Technical Fit (20%) | X.X | X.X | X.X |
| Vendor Viability (15%) | X.X | X.X | X.X |
| Cost / TCO (15%) | X.X | X.X | X.X |
| Implementation Risk (10%) | X.X | X.X | X.X |
| Innovation (10%) | X.X | X.X | X.X |
| **Weighted Total** | **X.X** | **X.X** | **X.X** |
### Vendor Profiles
**[Vendor A]**: [2-3 sentence summary of strengths and weaknesses]
**[Vendor B]**: [2-3 sentence summary of strengths and weaknesses]
**[Vendor C]**: [2-3 sentence summary of strengths and weaknesses]
## 5. TCO Comparison (5-Year)
| Cost Category | Vendor A | Vendor B | Vendor C |
|---|---|---|---|
| Software | $[X] | $[X] | $[X] |
| Implementation | $[X] | $[X] | $[X] |
| Ongoing (annual) | $[X] | $[X] | $[X] |
| Internal costs | $[X] | $[X] | $[X] |
| **5-Year Total** | **$[X]** | **$[X]** | **$[X]** |
| NPV @ [X]% | $[X] | $[X] | $[X] |
| Cost/user/month | $[X] | $[X] | $[X] |
## 6. Reference Check Summary
| Vendor | NPS (avg) | On-Time Implementation | Top Concern |
|---|---|---|---|
| [Vendor A] | [X]/10 | [X]% | [Concern] |
## 7. Implementation Risk Assessment
[Risk comparison by vendor with mitigation strategies]
## 8. Recommendation and Rationale
**Recommended**: [Vendor Name]
**Second Choice**: [Vendor Name] (if primary negotiation fails)
**Top 3 Reasons:**
1. [Reason with supporting evidence]
2. [Reason with supporting evidence]
3. [Reason with supporting evidence]
**Key Risks of Recommended Vendor:**
1. [Risk with mitigation plan]
## 9. Implementation Plan (High Level)
| Phase | Timeline | Key Activities | Investment |
|---|---|---|---|
| Contract & Kickoff | Weeks 1-4 | Contract signing, project setup, team mobilization | $[X] |
| Design & Configure | Weeks 5-16 | Requirements validation, configuration, integrations | $[X] |
| Test & Train | Weeks 17-24 | UAT, performance testing, training delivery | $[X] |
| Go-Live & Stabilize | Weeks 25-30 | Cutover, hypercare, issue resolution | $[X] |
## 10. Decision Required
- [ ] Approve recommended vendor: [Vendor Name]
- [ ] Approve budget: $[X]M (implementation) + $[X]M/year (ongoing)
- [ ] Authorize contract negotiation to proceed
- [ ] Confirm go-live target: [Date]
Quality Checks
- Requirements gathered across all four categories (functional, technical, integration, non-functional).
- Build vs. buy analysis completed before vendor evaluation.
- All vendors scored using identical weighted criteria with consistent rubric.
- Category weights validated with stakeholders before scoring begins.
- At least 3 vendors on final short list for meaningful comparison.
- Demo evaluation uses scripted scenarios consistent across all vendors.
- Reference checks completed with at least 3 references per finalist.
- 5-year TCO model includes all cost categories with consistent assumptions.
- NPV calculation applied for multi-year cost comparison.
- Implementation risk assessed per vendor with mitigation strategies.
- Contract negotiation checklist covers all critical terms.
- Decision presentation structured for steering committee approval.
- Scoring methodology is transparent and defensible.
- All estimates carry confidence levels (High/Medium/Low).