How to Document System Requirements Before You Choose New Software

New software opens up abundant opportunities for improvement: automated processes, streamlined workflows, system integrations, and much more. For many organizations, however, bridging the gap between current systems to new systems can be daunting. What begins as a push for efficiency can lead to frustration when the system fails to meet expectations—or worse, creates new problems.

The disconnect is rarely about the technology itself. More often, it is about understanding the needs of the organization and comparing that to the functionalities of potential system solutions. Too many software decisions begin with vendor demos and product specs instead of a clear internal roadmap. The result? Irrelevant features are demonstrated, system or partner weaknesses aren’t highlighted, and the final product favors old processes or new technology without factoring in best practices.

The best software decisions begin with documentation. Defining your requirements—what the software must do, how it should support operations, and where it must integrate—lays the groundwork for confident decisions. Before comparing platforms, get your needs on paper.

Begin With the Work, Not the Wishlist

Start with a review of how work gets done today. Map key workflows—monthly close, grant tracking, reporting—and identify where delays or manual effort slow things down. Where is data inconsistent? Which tasks depend on spreadsheets or institutional knowledge?

Think about what tools and information would be helpful, so you can factor in these processes to your solution evaluation. Do managers in development or operations need real-time reporting or dashboarding to effectively manage their teams? Might there be a benefit to budgeting down to the staff or role level? Are there reconciliations, true-ups, or variance analyses that are performed on an annual basis when they would be better conducted more frequently?

This exercise helps uncover root causes, not just symptoms. Additionally, it encourages creative thinking around how things should or could be as opposed to what’s always been done. This process also creates a sense of what functions are truly needed as opposed to nice to haves or wishlist items. By grounding the process in actual workflows, you are more likely to select a system that encompasses all of your current and future needs.

Build a Blueprint

The next step after conceptualization is to document where your current systems fall short. What tasks require workarounds? Where does delayed data slow decisions? These are the small inefficiencies that can grow over time.

Good documentation shifts the conversation from “What can this software do?” to “What do we need it to do—and why?” That clarity helps focus your search and frames more productive questions.

In AAFCPAs’ recent Nonprofit Educational Seminar, 38 percent of attendees identified exploring software add-ons as a priority for streamlining operations. When you have a clear view of your challenges, you are better positioned to assess whether add-ons or integrations may address them.

Include the following in your documentation:

1. Functional needs. What tasks must the system perform? Think approvals, allocations, and compliance reporting.
2. Integration points. What other systems must connect? Document where data comes from and where it needs to go.
3. Reporting and visibility. What information needs to be available, to whom, and how often? Identify key reports and dashboards.

This process reduces the risk of missed requirements or rushed decisions. It also levels the playing field when comparing vendors, letting you focus on substance over style.

Use Requirements Documentation to Guide the Vendor Conversation

Once you’ve documented what you need in a new system, vendor conversations become easier. Requirements steer vendors away from giving you a sales pitch and towards providing targeted, specific responses to your needs and wants. These requirements can be presented in multiple formats simultaneously. Providing a generalized narrative of what features are needed in certain business areas—such as AP, grant management, fundraising—will contextualize the overall focus. Detailed, line by line expectations of exact features that you’re looking for from a provider will oblige respondents to commit to each requirement with a yes, no, and/or reason why.

Lead with your requirements, not a demo. Share your must-haves and ask how their system addresses each one. Request examples. How do similar organizations use the software? What limitations should you know upfront?

This helps avoid time spent on platforms that appear promising but fall short. It also shows which vendors listen well, respond clearly, and understand your goals. Use your requirements to objectively evaluate each solution and have measurements that may be compared for selection. If you do not have documentation, it is often hard to develop comparisons that lead to a conclusion.

Requirements are not just a technical formality. They are your compass in a crowded software landscape. Let them keep your decision focused on solutions that work in practice—not just on paper.

Explore This Topic in Greater Depth

AAFCPAs explored tools that automate routine tasks across resourcing, project management, budgeting, and AP automation during our Nonprofit Educational Seminar. The discussion includes guidance on how to optimize your tech stack to improve accuracy, boost performance, and support strategic decision-making—without overcomplicating.

How We Help

At AAFCPAs, we align people, processes, and technology to help you achieve measurable growth and operational efficiency. Our Business Process & IT Consulting practice focuses on business intelligence, cybersecurity, data analytics, and process automation, delivering solutions tailored to your unique challenges. Whether selecting new software or refining internal controls, we help you make informed decisions and maximize the value of your technology.

With a team of experienced technologists, data analysts, and CPAs, we work closely with you to streamline operations, reduce risks, and improve your overall system performance. We take the time to understand your needs, ensuring every solution supports your goals. By combining practical expertise with rigorous project management, we help you unlock the full potential of your technology while staying focused on what matters most to your business.

These insights were contributed by Robyn Leet, Partner, Business Process Assessments & Attestations and Stuart Karas, Systems & Process Optimization Consultant. Questions? Reach out to our authors directly or your AAFCPAs partner. AAFCPAs offers regular resources on business and IT consulting. Subscribe to get alerts and insights in your inbox.