Software selection depends on many factors, such as the functionality of the software, its price, or user satisfaction. Our biases are another important factor that is often overlooked. While a biased selection isn’t the end of the world when buying low-cost software, it can be a deal breaker when purchasing enterprise software like ERP.
Let’s take a look at how our biases impact software selection and what we can do about it.
How biases impact software selection
While we all make mistakes once in a while, we are sometimes prone to systematic and unconscious errors, also known as biases. Biases are often the result of mental shortcuts (or heuristics), which help us process information quickly. For instance, if I want to buy a coffee, I'll go to the coffee shop I already know instead of looking for and comparing all the options in my area.
Heuristics don't always lead to the best decision. In the example above, I could find cheaper or better coffee, but I'd need to walk more or drive. However, this kind of mental shortcut may have severe consequences regarding software selection. Choosing the wrong software may be disruptive for a company, not to mention costly. Therefore, understanding how our biases impact decision making when selecting software is critical.
| Here are some types of biases that may influence our decision making when buying software: |
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The best way to understand how our biases may impact software selection is to look at some examples. G2 reviewers often share feedback on why they switched from one software solution to another.
Source: Behavioral economics guide 2022.
How to overcome software selection bias
Understanding how biases work leads to a level of sophistication that helps improve decision making. However, to overcome biases, we require more than sophistication. Since they're unconscious, biases may still lead to irrational decisions, even though we rationally know we shouldn't make them.
The good news is that people can be influenced to make better decisions through a concept known as a nudge. Nudging refers to altering people's behavior "in a predictable way without forbidding any options or significantly changing their economic incentives." (from Nudge, by Richard H. Thaler and Cass R. Sunstein)
The bad news is that the same concept can also be used to make buyers choose a product over others. This is a bad nudge or a sludge.
My next blog will describe how to use nudges and avoid sludges to improve software selection. In the meantime, you can learn more about software purchasing behavior from our 2022 G2 Software Buyer Behavior Report.
Edited by Sinchana Mistry
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Gabriel Gheorghiu
Gabriel’s background includes more than 15 years of experience in all aspects of business software selection and implementation. His research work has involved detailed functional analyses of software vendors from various areas such as ERP, CRM, and HCM. Gheorghiu holds a Bachelor of Arts in business administration from the Academy of Economic Studies in Bucharest (Romania), and a master's degree in territorial project management from Université Paris XII Val de Marne (France).
