In part 1 of this series I wrote about a simple case where failure to define requirements for a software purchase ended up costing the business several thousands of dollars worth of wasted effort that had to be re-done. The software purchase price was just a few hundred dollars, so it seemed okay to take shortcuts in the selection process. The resulting loss was more than anyone bargained for.

In part 2, this post, I’m writing about a much larger purchase of custom-developed software. This is a true story of a project that could have turned into a disaster. It could have sunk a new startup company before it ever got off the ground. It could have failed badly. But this one actually has a happy ending. Disaster was averted because the business owner stopped in the middle of the process to ask some key questions, and he acted on the answers.

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I recently appeared on Nancy Brown’s Business Guru Show on Blog Talk Radio to speak about “How To Avoid Technology Traps.” You can hear the show (30 minutes) by following the link or you can play it right here:

I’m starting a short series in How Business Automation Projects Fail. This is part 1, where I’ll cover the case of an apparently simple project to install a common software package. In part 2 I write about a much more complex and expensive project.

Business Processes

Businesses run by following well defined processes. Let’s look at a wholesale distribution business as an example. Here’s a grossly simplified version of the core processes at the heart of the business:

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I find that many small-to-medium local businesses are hiding from their customers and don’t realize it. They still market to new customers in newspapers and the Yellow Pages, and they still stay in touch with existing customers (if they do) by direct mail.

But those traditional marketing channels are increasingly empty. That’s not where you find customers in the 21st century. No, they’re online. They’re on Google, Twitter, Facebook, StumbleUpon. They’re blogging and commenting on blogs. They’re forming communities of interest on Digg and social|median.

If businesses aren’t familiar with these venues and aren’t meeting their customers where they hang out and interact, then they’re missing an enormous opportunity to keep building even during these recessionary times.

So stop hiding from your customers^SM. I can help. Contact me today.