Software Proof of Concepts Best Practices II

The following was a question posed by a reader to the blog Software Proof of Concepts Best Practices written April of 2010. The question posed was rather interesting.

I’m working on a software Proof of concept project here in Finland and writing my master’s thesis related to the project for Lappeenranta University of Technology in the department of Innovation management. I read your blog post from April, 2010 (Software proof of concept best practices, ) where you state the following:

“The indirect costs associated with an evaluation can often be up to 25% of the cost of the product.”

I was wondering the source of this statement, is it based on a scientific research, your experience, some sort of corporate research?

The costs analysis of a software proof of concept seems to be pretty complicated issue and this is one important aspect in my master’s thesis.
Hope to hear from you soon and thank you for an interesting article!

Best regards,

Mr. XXX –

It is nice to meet you virtually. This statistic came from my own personal experience. During the period 1996-2007 I was selling and implementing large scale global ERP projects with the likes of PeopleSoft, SAP and NetSuite. Coincidentally, I remember being in Finland on several occasions up in Jyväskylä.

My intent in this blog was to demonstrate that the evaluation process was as difficult as the actual implementation itself. To model out the costs associated with the implementation will be wide and varied:

1. How large is the project
2. How much exec project sponsorship
3. How large is the evaluation team
4. Are the requirements fully defined
5. Does the project team have clearly defined goals and metrix

Since there are so many variables in the selection process, a specific number may be rather difficult to obtain. Good luck with your thesis project. If you figure out a model that is more specific than the 25%, I would enjoy understanding it.


About Cameron Ackbury, CPA

Founding Director at DaggerFoil Group
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