Whitepaper: How to Choose a Technology Partner

Selecting the right technology partner for your business is not getting any easier. MLS organizations face a bewildering array of vendors from which to choose, and the rate at which technology is accelerating only compounds the problem. Who has the best combination of products and services? Will this company still be the leader 3 years from now? These are the questions MLS executives are wrestling with as they approach the end of their current contracts.

In the face of these uncertainties, there’s one thing you know for sure: the MLS system you need today is a far cry from the one you provided to your memberships just five years ago. The Internet has changed and will continue to change the way people buy and sell property. The ease with which consumers can access listings on the Internet has already eroded the value of the agent’s "traditional" services. Consumers are demanding to pay smaller commissions, and agents and brokers are feeling the pinch. In turn, this has put pressure on MLS organizations to reduce their dues to all-time lows.

No longer the exclusive gatekeepers of property information, MLS organizations have a new goal: ensuring the ongoing profitability of their members through technologies that can help fulfill the Web-savvy consumer’s evolving needs.

But making sure you choose the right technology—and a vendor that can offer the services and support you need—can be challenging. Here are some guidelines and questions you can use when selecting your next technology partner:

1. The Company

What do you know about the company that makes the software? Choosing the right system should always begin with an analysis of the vendor that provides it. Even the best software application is not worth much if it is not backed by a quality organization.

• Is the company financially stable?
• Does the company have a proven track record building real estate applications?
• Does the company invest in its future, in research and development, and in resources?
• Consider the size and infrastructure of the vendor. Does it have the resources to support the size and the needs of your organization? Does it have dedicated teams for development, implementation, quality assurance, technical support, and network operations?
• What communication channels exist to ensure an efficient working relationship?
• What relationships does the company have with other technology companies?

2. Client-Server versus Web-Based Products

When evaluating client-server systems versus Web-based systems, it’s important that you understand the benefits of both. Client-server systems can be faster, but Web-based systems provide mobility, easier support and maintenance (no CDs to distribute), and quicker development cycles.

• Can the vendor offer the best of both worlds—a distributed desktop product and a Web-based product?
• What can the vendor do to help prepare your membership for the transition to a Web-based MLS system?
• Does the vendor offer Internet training? (Acclimatizing your members to the Internet will help set and manage their expectations of a Web-based system.)

3. Subscription Model

How functionality is delivered to your membership can be just as important as the functionality itself. Beware of one-size-fits-all solutions.

• Does the vendor provide an "evergreen" model with automatic product updates and no additional costs for maintenance releases or new feature updates?
• Does the vendor employ a flexible model that easily accommodates the unique needs of your membership, providing basic functionality to part time and casual agents and extended functionality to full-time real estate professionals?
• Is the subscription model flexible enough such that extended functionality can be acquired on an agent-by-agent basis?

4. Data Management

The value of the data in your system largely depends upon its quality, completeness, and accessibility.

• Data In—does the vendor have a robust listing input module that ensures data integrity? Up to 25 percent of stored MLS data is inaccurate due to inferior listing input modules.
• Does the vendor provide a listing input module that is customizable and able to handle the unique business rules of your MLS? Does it have field-by-field data integrity checks? Can it auto-populate property information from your tax database?
• Does the listing input module have the ability to do incremental saves, allowing office administrators to multitask without losing the work they've already done?
• Is the database designed to fully integrate property data with tax data and listing history information?
• Data Out—is the MLS system built on open-systems architecture and does it allow for easy data extraction by third-party vendors and brokers?
• Data Management—is the MLS system sophisticated enough to manipulate data and help MLSs and brokers determine market share, days on market versus list price, and other meaningful statistical information?

5. System Architecture

As long as it does what it’s supposed to, the system architecture doesn't really matter, right? Wrong. As the needs of your membership change, you'll quickly realize the importance of a well thought out, flexible and extensible design.

• Is there redundancy in the network and system architecture?
• Does the system architecture allow for scalability and capacity on demand to support your growing membership?
• Is the vendor a true Application Service Provider (ASP)? Is there a generic database and application platform to allow for quick implementations?
• Does the system allow for board-level and user-level customization of business rules and user interface components such as search criteria screens and reports?
• What kind of infrastructure supports the maintenance and monitoring of the system, and the ability to respond on a timely basis should issues arise?

6. Service

If your chosen vendor doesn't offer all of the system-related services that you and your membership require, you'll have to hire third parties to fill the gaps—third parties that may or may not have expertise with the vendor’s system.

• Can the vendor provide the level of service you want to offer your membership? Does it have the capacity to handle the support requirements of a board your size?
• Do they have field staff, on-site support, a call center to provide live end-user support, Web-based end-user support, a knowledge base that can be referenced by users, and flexible training options including end-user training and train-the-trainer?

7. MLS Books

Still important to many MLS organizations, MLS books round out a full-service vendor’s value proposition.

• Can the vendor provide MLS books and other printing services to the board, its broker members, and its agent members?

8. Turnkey versus Full Service

Your organization should perform a cost benefit analysis of turnkey versus full-service systems. If you are considering a turnkey system, make sure you examine the cost of software licensing, hardware support and maintenance contracts. Be aware that systems need to be hosted in a qualified data center to get 24x7 monitoring of the hardware, software, and network.

9. Buy versus Build

To really consider all your options, your organization should compare the benefits of buying a system versus building your own system in-house. Because technology changes so quickly, many MLS boards have found it too difficult and expensive to keep pace. The operational costs of staff, product development, product maintenance, and product support must be considered. MLS vendors that specialize in the development of MLS software have the advantage of being able to defray such costs across a much larger user base.

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