It has been estimated that U.S. corporations waste tens of billions of dollars on information technology assets they do not need or ever use. When software turns into shelfware it becomes a big part of that waste. For purposes of this discussion, shelfware is any software package meeting one or more of the following criteria:
How often do these things happen? Surveys vary widely depending upon the type of software being studied. Overall averages for shelfware of 10-15% have been circulated. In some specialty cases, it has been suggested that up to 85% of software sales result in shelfware. The cost is staggering when you consider the 20% maintenance fee that gets charged year after year.
So who's fault is this? The IT department, the software vendor, and senior business decision-makers all shoulder some blame. But rather than pointing fingers and finding someone to accuse, let's examine how shelfware can be prevented and cleaned out.
Be a smart buyer
A good place to start is buying software just in time. That is, delay new software purchases or major upgrades until the business need is genuine and justified. Don't get talked into buying just because the vendor is offering a special deal or prices are about to go up. Also avoid buying extra licenses because they might be needed someday. Those maintenance fees will kick in whether the software is deployed or not.
Beware of buying extra modules that are not needed. Sales people will frequently offer enticing discounts on these modules "if you buy them at the time of the original purchase". These extras are a frequent cause of shelfware. Remember that the maintenance fee will be based on the list price not the heavily discounted promotion price. Those bargain add-ons are budget busters. Stay focused on the strategic objectives for buying the software.
Look and listen
Major enterprise deployments require not just training but evangelism. Someone must monitor the software users, offering ideas and instructions as they go about their daily routine. Training classes only go so far. They don't deal with the thousand and one real-world scenarios that stump and stymie the user community. The evangelist can deal with these real-world situations and supply tips and techniques to all users. She will also be able to find new and creative uses for the software that just aren't obvious from reading the manual.
Keep a watchful eye on usability. Many enterprise packages require significant database and user interface customization. Involve the people who will use the software daily in any user interface design sessions; not just the managers and intermediaries! Listen to their needs and incorporate their ideas. Greater acceptance of the new procedures for getting work done as well as incremental productivity gains can be achieved using this approach.
Monitor usage and reactions
Larger enterprises should monitor software usage. Asset management software can tell you what software is installed on desktop systems but that is not enough. Find a package that can meter software usage showing who is using it and how often. (One example of such software is Centameter by Tally Systems.) Smaller firms may not want to purchase such software but they can examine log files or generate reports within most enterprise software showing who is logging in and running the software.
When you find software that is being underused, gather together representatives from IT, business operations and the software vendor. Interview the users and find out why the software has become shelfware. Address the issues and get buy in. (If the vendor tries to charge for participation, threaten to toss out the software altogether. You are paying for maintenance and this is a maintenance issue.)
Sell the software internally
Finally, sell the benefits of the new software internally. People are naturally resistant to change. We get comfortable in doing a task in a certain way, perhaps using Microsoft Excel or Outlook, and are reluctant to transition to a new software package.
Companies often tell everyone how the new software will make it easier for management to generate reports. Or, the software will enable the company to consolidate information and servers. The employees are justified in asking "what's in it for me?". They need a good reason to make the switch. How will they benefit? What will they learn? Why should they care? If these questions can't be answered, many will continue to do things the old way long after the new software has been deployed. This can be a very expensive problem. Address it up front.
Don't let that expensive enterprise software wither into shelfware. Make smart buying decisions, monitor usage over time and pay attention to your employees. If any software package outlives its usefulness, remove it and cancel the maintenance contract. Your information technology environment will be simpler resulting in lower software costs, fewer support calls, stronger software integration, and improved network security.
Vin D'Amico is Founder and President of DAMICON, your ADJUNCT CIO. He is an expert in leveraging open software to drive growth. DAMICON provides Freelance Technical Writing, IT Disaster Response Planning, and Network Security Management services to firms throughout New England.
This article appeared in Vin's monthly Virtual Business column for the IndUS Business Journal in August 2004.
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This column appears monthly in the IndUS Business Journal.