A common question asked by our advisory customers is whether they should use a software vendors' professional services arm. Over the years I have come to recognize this is not an easy question to answer.
Professional services can mean a lot of different things, and can represent a very substantial part of a software vendors income. These services can range from initial requirements analysis, process design, development, system installation and configuration through to testing and training. Also, vendor profiles here can differ substantially across the different technology segments we cover; our different research streams offer technology-specific advice in that regard.
Still, services will typically take up the lion's share of your budget. I posit that most enterprises will spend between 2 and 4 times the cost of software licenses on professional services of one kind or another (sometimes more). So if you spend €500,000 on software licenses you can expect to spend a total of €1.5 to €2 million in initial implementation costs for your project.
Yet, software buyers typically spend much less time and attention on this than they do the selection and spend on software licenses, and that is not smart.
I cannot examine all the various elements to this question here, but will argue upfront that your software vendor is not always the right choice of provider of professional services for your project, no matter how good a deal they offer you. In fairness I should also say that some vendors have outstanding professional service teams, and many are capable of doing a very good job. Nevertheless I recommend that you the buyer, particularly in larger and more complex projects, consider the provision of services as a separate procurement process.
The reason is that there is often a very wide choice of services providers ranging from tiny boutiques to mega firms like TCS, Wipro, Accenture, Cap Gemini or Infosys. A locally based boutique may provide much better and more personal service, a mega firm may have a much larger and more highly skilled team of consultants than a vendor has in house. Likewise, though a vendor may know their product really well, and may even provide some insight into industry best practices, you are likely to find the essential business change and process skills supplied more effectively by outside experts not connected to a specifc software vendor.
The long and the short of it is you have to select a services provider that suits your specific needs, one that you are comfortable working with, one that understands and cares about you. The professional services divisions of software vendors may be the right fit, but rather than assuming that they are, I advise you to follow the same scenarios and bake off process we recommend to our research customers when selecting software.