Vendor Selection

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Curated Learning Resources

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  How to Select Vendors: look for rate of improvement in the product

  Auren Hoffman, CEO, SafeGraph

  When selecting software vendors, the rate at which their product is improving is an important factor to consider in addition to features, price, and compatibility. Products that fix bugs and issues quickly, add new features frequently, and continually delight customers are likely to improve at a fast pace in the future. Companies that publish detailed change logs showing how their product has improved over time gain customer trust and help with the sales process. Publishing clear change logs has significantly helped SafeGraph's sales and Customer Relationships. In summary, looking for the rate of improvement in a vendor's product is a great way to choose between options.

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  Selecting a Cloud Provider

  Mike Fisher, CTO, Etsy

  Etsy decided to migrate their infrastructure from self-managed data centers to a cloud hosting provider. They undertook a careful selection process to choose the right partner. They identified over 30 sub-projects within the migration and used a RACI model to assign responsibilities. They held architectural reviews and experiments to determine requirements. They met with Google Cloud Platform multiple times and reference customers to gather information. They created a decision matrix weighing over 200 factors to evaluate the cloud providers. Google Cloud Platform scored over 10% higher based on Etsy's requirements. The selection process took 5 months with many people involved. The migration itself will take around 2 years while Etsy continues to focus on product innovation and risk mitigation. The use of a decision matrix weighing over 200 factors to evaluate the different cloud providers based on Etsy's specific requirements seems like an interesting and data-driven approach within their selection process.

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  In Defense of Not-Invented-Here Syndrome

  Joel Spolsky, CEO, Stack Overflow

  Joel argues against the common view that code reuse and avoiding reinventing the wheel are always good, while the Not-Invented-Here syndrome is always bad. He claims that for core business functions, it is better to develop solutions in-house rather than outsourcing, even if that means reinventing the wheel. Outsourcing often leads to poor quality, lack of control, and inability to meet customer needs. Truly valuable companies write their own excellent code that forms their core competitive advantage, rather than relying on third-party solutions. However, for non-core functions, outsourcing and code reuse can make sense.

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  Build versus buy.

  Will Larson, CTO, Carta

  When deciding whether to build a solution internally or buy from a vendor, companies should consider risk, value, and cost. Risks include the vendor going out of business or changing their offering. Value comes from how the vendor's solution compares to what you can build, both now and over time. Costs include integration, financial, operating, and evolution costs over the lifetime of using the vendor. Ultimately, companies should determine if any risks are unacceptable, then perform a simple value versus cost calculation to make the decision. However, companies often neglect vendor management, which is key to extracting full value from vendors.

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