The Executive’s Guide to Information Technology, Second Edition

Chapter 12. Vendor Selection

	Thinking is the hardest work there is, which is probably why so few people engage in it.
	--Henry Ford[1]

This chapter outlines the process for selection of major outside service and product providers and the subsequent management of the vendors. The list of external vendors used by even a small IT shop is often lengthy. Vendors provide products and services across a wide variety of categories—telecom, networking, consulting, software, and hardware. In a given category, often multiple vendors are used by the department.

This chapter is organized around the first of two major vendor-related tasks facing the IT manager: selecting vendor partners and products. The next chapter covers the management of the vendor relationship “after the sale.” It provides a comprehensive methodology and approach for vendor selection. Most often, the major vendor selection activities of an IT manager are focused on the selection of software to support the business, with decisions on vendors for hardware, services, and supplementary systems emerging from the primary package decision; therefore, this chapter is primarily focused on the selection of package application software and accompanying products and services.

The selection approach defined here is intended to be a full-fledged, comprehensive methodology that results in the most rigorous, thorough (and painstaking) process for determining the “best” vendor. The steps described can, and should, be skipped or otherwise de-emphasized, ...