Why we have a one-month notice period on our software
“We wanted to move away from legacy software practices and align ourselves with the way advisers run their businesses,” says Roland Rawicz-Szczerbo, director, Time4Advice
Typically, in most industries, companies providing IT and software services will impose a tie-in period. This might be a 12-month contract, with a 6-month notice period. With this type of contract companies know they have users for at least 18 months (or pay a penalty to get out), even if the customer realises it is not the software for their business.
Most people will give a software system a reasonable bedding in period before conceding they need to switch, only to find they are going to have to stick with the software for some time before they can move.
As a software provider there are good business reasons for having a long tie-in: There is a cost implication in bringing a customer on board and you want to ensure a steady revenue stream to fund ongoing maintenance of the software. Obviously the longer a customer stays using the system and paying for the licenses the better.
And if a customer has been using a system for 12 months or more it can be difficult for them to walk away. There is the time and the inconvenience of researching the market for a new supplier and then moving the entire firm’s data on to a new system. It is going to be a far more significant decision at that time.
This is good news for the software company as it knows that things need to get really bad for a client to make the decision to act. Inertia is a massive disincentive to change.
Knowing that it is difficult for clients to move software suppliers has other benefits. Firms can be more relaxed about how fast they develop their software, which is an expensive and risky exercise. Further, long-term contracts can dissuade software suppliers from explaining to clients just what is involved in adopting software and to get it operating properly within a business, which is why most software salespeople pay lip service to the need to invest in training and implementation support, which they see as a barrier to a sale.
A different approach
When we set up Time4Advice we knew we wanted to be different in the market. From our past experience we also knew that a piece of software is not going to be right for every business and that often there’s a time lag before this becomes apparent.
By having a one-month’s notice contract we feel we are far more closely aligned with our customers’ needs and believe this approach supports the concept of treating customers fairly. We are hugely incentivised to continue to develop the system to keep it relevant to our clients but we also make it easy for people to leave us because we know that until you start using a piece of software you’re not going to know just how well, or not, it suits your business. And we know we’re not going to be suited to everybody.
We’ve also found that people need proper support to get the best from any software, particularly in companies that have offices and advisers spread around the country. Although the number will vary from firm to firm, we estimate a company needs anywhere from 10-20 days to properly use a system and get the most from it. So we work with our customers to deliver the training and the implementation support they need to get up and running with the software as quickly as possible all based on a thorough understanding of the main business drivers and priorities. To help firms invest in their businesses we spread the cost of all consultancy, implementation and training support as well as offer increasing discounts on our day rates the more a firm buys at outset. The aim is to incentivise firms to invest in their businesses as well as make it easier for them to come on board and to really use CURO to its best advantage within their business.
It pays us to ensure firms are getting the most from the system so we keep them on board by working closely with them over the first twelve months and beyond. And we’re not going to sell our software to firms unless they have the time, the resource and are willing to invest in their business to learn how to use it properly, because if they are not, then everyone is simply on a hiding to nothing.
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