4 Most Egregious Issues in Local Government Software Purchasing

Posted on November 10, 2015

At Seneca Systems, their mission is to rekindle passion for public service in America’s 10.5 million local government employees. They have worked with offices across the country, from Oakland to Chicago, to improve constituent relations with a powerful, modern CRM called Romulus.

By Chris Maddox, CEO, Seneca Systems – LinkedIn and Twitter

From onerous contracts to thousands of dollars in fees, local government software purchasing needs significant reform. In my work at Seneca Systems, I have come across some unexpectedly nasty behavior from vendors. In this article, we’ll walk through the most egregious issues in local government software purchasing.

Together, we can tell these vendors: enough is enough!
Avoid Contracts
If I could make only one change to encourage innovation in local government, it would be to eliminate contracts. Why? Because they are bad for your team and the constituents you serve. Don’t get me wrong, contracts are great for businesses. As a CEO, you would save my accountants a lot of worry if you signed a contract guaranteeing to pay us for 12–24 months.
downloadBut how does that motivate us to improve?
Think about this way – When you ask a high-school teacher what happens to seniors once they get accepted to college, the teacher give you a laundry list of senioritis stories. The same goes for contractors and vendors once you’ve agreed on the bare minimum they need to do in order to get paid.
But what happens if you find a better product the next month? You’re out of luck. Either you stick with an inferior product or waste tax dollars paying for two systems at once.
Tip: If you sign a contract, negotiate an ‘out’ that you can exercise if the product is not meeting your expectations.
Consider the Costs in Managing a Contract
Managing contracts is not free. Every change requires legal review from both sides and those legal costs have to be paid by someone. As a result, taxpayers are picking up a huge tab for the time you spend negotiating changes to a contract. Local governments need many things, but more legal fees are not one of them.
Tip: Look for services that charge monthly so you can always have the best software to serve your constituents.
Watch for Hidden Fees
customer-service-call-comcastHidden fees and poor customer support — It’s why we hate airlines, cable companies, and wireless phone providers.
Fees should be avoidable for 90% of customers. If you have a highly specific need, you’ll probably need to pay a little extra, but when you start seeing $75,000 for “configuration”, ask yourself if this company really cares about its customers. The answer is probably no.
Companies should not charge you to get started using their software. When you have questions, you should have responsive customer service without figuring out what “service level” you belong to. No contracts, no fees, no service level agreements (SLAs).
Tip: Ask questions about start-up charges. You have a right to know exactly what you are paying for.
Know the Real Price of a Product
When you buy a used car, everyone knows that you should ask for a discount — including the car dealer.
Do you think they would offer a discount if the sale were not still profitable? Absolutely not! So they price the cars higher and set a limit of how much they are willing to negotiate down. Unless you hit that number exactly, you end up paying more for the car than you would have otherwise.
Successful negotiation makes you feel good, like you’ve saved some money. But if you are getting a discount based just on negotiations — not, say, a discount for buying in bulk — you’d better believe the other side has planned for this and marked up accordingly.
Tip: Use the power of public service — most of what you do is public record. Ask your colleagues in other cities how much they paid for a certain product.
You came into public service to make a difference in your community. Partnering with private software companies can help to amplify your impact with the people you serve. At the same time, it is important that local governments draw the line when it comes to exploitation from vendors.
You have dedicated your life to a noble cause and they are claiming to be on your side. It is time they started acting like it.

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