Consider Company History & Experience

The vendor needs to be sized up before we even go on to consider the software itself. Often, these companies would be handling our sensitive business data. Questions to ask are - How long have they been around? How long have they been in their current industry? Do they serve the same niche as yours? What do the customers say?

I recommend: Visit industry & company information sites like hoovers.com, yahoo finance or google finance. Open searches on engines like google & business.com will help you come up with additional information and opinions about the company.

The Cost Factor

There's no denying the importance of cost yet costs should be seen in a broad perspective, because low entry costs may well result in higher total costs along the product's life. Costs need to be weighed in light of feature set and needs.

I recommend: One option could be to check out the pricing page of each offering you are interested in. Another option is to visit resource sites which offer a good price and feature comparison for different categories of software like toptenreviews.com (multi category comparisons), intranetresearch.com (intranet software comparison), sharepointalternative.com (cheap alternatives to MS sharepoint).

Consider User Friendliness and Ease of Adoption

An adoption & learning curve is involved with every new software purchase. It is important that these are short or it will lead to user frustration and resistance. Training provided by the software vendor acts as a good kick start. Sooner or later problems do crop up, so the level of support of the vendor (help engines, live support, or dedicated account personnel) helps. It is important that the software is low maintenance, and does not necessitate hiring of special staff.

I recommend: The new concept of "software as a service" (SAAS) hosted software solutions like HyperOffice, Google Apps or Sharepoint Online, scores in terms of ease of use, adoption & maintenance. The software is hosted by its developer, & buyers have to pay a monthly subscription to use it.

Consider Security

Security is a top consideration because he software company will likely be handling information critical to us - business, financial or personal. We need to be well assured of our data's security & there are no risks of it being compromised. This needs research, & the extensiveness of which depends on the sensitivity of our data. Check out the company's track record. Have their security systems ever been compromised?

I recommend: Password protection is the first level and bare minimum security measure. Look out for providers who encrypt data using the SSL 128 bit encryption standard to safeguard data. Automatic backups ensure that your data is always backed up in case of loss. Anti virus and anti spam may be relevant depending on the type of software and where it is hosted.