Category: Platform & Implementation Strategy

Software implementation can be challenging. That’s particularly true for private equity and venture capital firms, where getting software solutions up and running efficiently and effectively is critical. Allow the process to drag or do a poor job of ensuring user adoption and you can miss out on deals.

Consequently, it’s important to understand how to conduct a software implementation the right way and to take a methodical approach when you’re ready to put the solution in place.

Relate the System to Your Business Processes

Too often, firms neglect to talk about how a new fund management software system will integrate with their current business processes. But it’s important to consider both a solution’s technical capabilities and how those features will be used in your setting before you begin your software implementation.

It’s also crucial that you address both aspects when providing “how-to” training. The last thing you want is for users to say, “I see how it functions. But how does it support what we do?”

For example, as part of your software implementation, it’s important to talk about how deals flow through the system. In addition to teaching users how to access and navigate it, you must also walk through things like:

• The different ways deals come in—through intermediaries, for instance
• How users should log deals into the system
• Who gets alerted about the new deal
• How important information is circulated internally
• Who is responsible for acting on the information

A good approach is to prepare for your software implementation by identifying the five most important processes that your team will use it for. Get users together and discuss not only how those processes will be handled in the system but also how the software can streamline and simplify that process so that it’s done better or more efficiently after the switch than it is today.

The First Two Weeks After a Software Implementation Are Critical

Research has shown that what happens in the first two weeks after a software implementation has a significant effect on long-term software adoption. If you can get users to log in daily during the first two weeks, that’s a great start. Through frequent exposure to the system’s features and function, they start to understand its value.

Soon, they’re searching for information, running reports, adding data, etc., and doing so with greater efficiency than in your old system. As a result, these actions come with “rewards” in the form of time savings that encourage users to continue exploring the system. And not only do they start to rely on the solution, but they also become advocates that encourage others to learn about its advantages.

If, on the other hand, users don’t get on board in the first few weeks following a software implementation, the odds of them ever leveraging the tool effectively drop significantly—and the work a firm puts into promoting adoption of the solution in the weeks and months that follow quickly starts having diminishing returns.

Promoting Early Adoption

So, how do you go about getting people to log into the new solution following your software implementation? The key is to have a carefully considered and executed plan.

It should include:

• Designating an internal “champion” to promote the system in meetings, in casual conversations, etc.
• Having a system administrator review user login history daily and report the stats to those responsible for the software implementation so that they can nudge reluctant users
• Having the champion and other early adopters model behavior like generating and sharing reports from the system to encourage others to log in
• Making the system and its features a point of emphasis in everything from meetings to casual conversations

Software implementations and achieving a high rate of system adoption don’t have to be difficult. As long as you have a strategy in place before the new solution is launched, you can ensure that your team members quickly understand the benefits of the system and start capitalizing on its features to make their work easier and improve the firm’s operations.

And, of course, your software implementation will go much smoother if you’re moving to the right system!

There are many software solutions on the market today that help fund managers track their deal flow and manage fundraising. It seems like each solution employs a different software implementation strategy ranging from an extensive and prolonged engagement with a consultant (on one end of the spectrum) to the software provider that just provides access to the software and says “Good luck!” (on the other end).

You could argue that each of those approaches has its advantages. A long period with a consultant means your team will get all its questions answered and have a good understanding of the software when you go live with it. Being handed the keys means you’ll have to fend for yourself, and that can prompt you to delve deeply into its functionality. But, of course, both methodologies have their drawbacks, too.

So, while selecting the right software is critical, evaluating which software implementation strategy is right for your firm is just as vital. In fact, as we noted in another blog, ensuring widespread adoption of your private equity software solution is crucial to your success. And if your software implementation doesn’t go well, you’ll face an uphill battle in getting people to use it and maximizing its value to the firm.

Off-the-Shelf Solutions

Our extensive experience with firms of all types and sizes has proven that a so-called off-the-shelf (OTS) solution—one that’s used as is, with few if any modifications—can be a good fit for organizations that have fairly standard business processes. OTS software may also be the right choice for your firm if you’re price-conscious and looking to get a good amount of functionality for your dollar.

Software implementations with OTS solutions tend to be fairly straightforward. Because the same system is delivered to all customers, the software implementation process tends to be standardized and well-documented.

And the lack of customized functionality doesn’t have to be negative. Many firms find that there’s value in getting their software implementation and data entry completed quickly. For one thing, this approach minimizes implementation-related costs. Plus, enabling teams to get productive faster can mean increasing your revenue faster. So, in effect, the software pays for itself more quickly.

In addition, rapid software implementations can lead to greater buy-in from users, as they start seeing positive results and want to capitalize on that momentum.

Then, as your organization grows or users recognize the potential value in expanding the system, you can customize the solution or add functionality. Of course, this strategy requires that you buy a solution that’s scalable and expandable in the first place.

Software Implementation for Customized Solutions

If a private equity software solution will be highly customized, the software implementation is, by necessity, more involved. An expert or team of experts must work with users first to understand their needs and then modify the software to meet them.

This approach can be very beneficial if your organization has unique processes. It means you’re not forced to fit round pegs into square holes, so to speak. That said, when done right, this approach involves looking at your existing processes from a new perspective. Yes, the software will be modified to support whatever workflows you choose, but it’s wise to first ensure that those workflows make good business sense and that they’re clearly documented, well-understood, and universally practiced.

Then, when it’s time for the actual software implementation, there’s a tremendous value (and comfort) in being able to rely on the skills and experience of people who do software implementations for a living. They bring with them the latest industry-specific best practices and can ensure that your team is able to capitalize on them.

Expert software implementations are, not surprisingly, more costly. However, in terms of the total cost of ownership, paying for an expert-led software implementation can result in a system that provides greater value for a longer period.

Investing in a New Solution

As the private equity industry gets continually more competitive, firms have a greater sense of urgency when considering technology that can give them an edge. However, rushing to purchase a solution and conduct a software implementation is never a good idea. Firms that take the time to evaluate both the new system and the software implementation process always come out ahead of those that make snap decisions without considering the big picture.

You want to be sure that your firm is in the former category!