When dealing with purchases of high significance, IT shoppers may spend months, even years, making the purchase decision. A great amount of time and effort is spent defining purchase needs, researching the market, narrowing down vendor lists, and putting together a Request for Proposal (RFP). So, it hardly seems fair when vendor responses airbrush out weaknesses in attempts to win competitive bids. A thorough interview with the right references will help verify the accuracy and truthfulness of vendor claims.

Caveat Emptor: Can’t Blame a Vendor for Vending
IT shoppers tend to become irritated by slickly marketed proposals that position vendors favorably without revealing enough of the secret sauce to prove the viability of the purchase solution. In the vendor’s defense, it is their job to sell their products or services. A vendor will avoid incriminating themselves, and may even hide weaknesses in order to win lucrative bids. Furthermore, consultants and other professional service providers must protect their intellectual capital and will hold back on any of their solutions until contracts are signed.
Vendors do not go out of their way to be dishonest. Suppliers and service-providers focus on long-term client engagement, and it is not in their best interest to sell a product or service that will not deliver as promised. It’s also not likely that a vendor will waste time on a bid they have little chance in winning. However, the burden still falls on the purchaser to verify vendor claims.

Verifying Vendor Claims
Depending on the type of purchase or lease in question, supplementary examinations of vendor proposals might also include the following:
* On-site demonstrations. Particularly useful for software solutions, the vendor demo requires serious consideration and varies according to the type of software in question. For an example, refer to the McLean Report research note, “Building Demo Scripts for Enterprise Application Selection.”
* Financial assessments. When dealing with a small or unproven vendor, long-term viability of the vendor can be determined by examining the company’s financial statements.
* Vendor references. All RFPs issued should include a request for vendors to enclose information on references. These references must be contacted and interviewed as part of the evaluation process.

References Must be Requested
To ensure references are provided by bidders, the RFP documentation should include a request for vendor references. Vendor references should only be done once the vendor candidate has been established as a finalist in the bidding process. The references should follow the following criteria:
* The reference should be someone who had direct experience with the related purchase.
* The referring enterprise must be comparable in size, and industry.
* The business need of the reference must be similar to that of the purchasing enterprise.

Reference Interview Questions
A vendor proposal is similar to a potential hire’s resume in that the details provided are generally biased in the vendor’s favor. In order to get beyond the vendor’s written claims, references must be evaluated thoroughly. Questions for references should be prepared in advance, and written in a way that will uncover any areas of uncertainty. The interview questions should set out to not only prove vendor promises with regards to contractual obligations, but to establish the overall satisfaction the reference had with the vendor.
Questions should focus on the level of interpersonal detail that may not be uncovered by the vendor’s proposal. Though it is possible to conduct reference interviews using scales and scorecards, approaching the interview in a more conversational style will help uncover details about the vendor that numbers are unlikely to reveal. For sample questions and considerations, and as documentation to verify that vendor references have been performed, use the McLean Report “Vendor Reference Interview Template.”

Key Takeaways
1. Caveat Emptor. It is the buyer’s responsibility to perform due diligence in verifying vendor claims.
2. References are key. Vendor reference checks are essential to a supplementary evaluation plan, and should always be requested in an RFP.
3. References must be comparable. Purchasers must seek to interview references that are comparable in size, industry and needs in order to provide an accurate assessment of the vendor’s product or service.
4. Questions should breach the surface. Good interview questions will uncover non-technical service level issues that cannot otherwise be guaranteed in a vendor’s proposal.

Bottom Line
IT shoppers dealing with unknown markets cannot take vendor claims at face value. To reduce purchase risks, references must be requested in the RFP and evaluated in the selection process.