Thank you for sharing this situation. Evaluating custom software development companies can indeed be tricky, especially when you're dealing with a specialized industry like medical billing and payroll. Your approach of using an RFI followed by a detailed RFP seems solid, as it allows you to assess a company’s methodology and experience before diving into specifics. Here are a few additional suggestions that might help refine your process:

1. Initial Screening: Before diving into in-depth RFPs, you might consider conducting a round of preliminary interviews or a "soft" RFI that helps you narrow down the list of potential candidates. In these interviews, focus on understanding each company's domain expertise, experience with similar projects, and their approach to solving complex business rules.

2. Look for Case Studies or Proof of Concepts: When asking companies to provide a white paper, also request detailed case studies of similar projects they've worked on, specifically in the healthcare or finance space. This will give you a sense of how they handle complex requirements and customization.

3. Focus on Agile Development: Since your client needs a tailored solution, it's crucial that the company has strong experience with agile methodologies. Make sure they can demonstrate how they adapt to changing requirements and ensure regular communication and feedback loops.

4. Cultural Fit and Collaboration: As part of your evaluation, pay close attention to how companies approach client collaboration. The best partners for a complex project will be those that view themselves as an extension of your team, not just as service providers. Perhaps conduct mock discovery sessions or workshops to see how they engage with your team and gather requirements.

5. References and Demos: As you mentioned, speaking with references and seeing live demos of their work are essential. When checking references, ask very specific questions about how the company handled challenges, changes, and the delivery process for previous clients in similar industries.

6. Evaluating Long-Term Viability: Since this is a custom solution, consider the long-term partnership potential. Evaluate the company's financial stability, growth trajectory, and their ongoing support and maintenance processes. This is important to ensure they can continue to support and enhance the software over time.

For a comprehensive review of development companies and their services, you might find this resource helpful: https://www.cleveroad.com/blog/software-development-companies-vancouver/.

Best of luck with your project!

Your approach to evaluating custom software development companies is thoughtful and comprehensive. Sending out an RFI focused on organizational strengths, experience, and methodology is a solid starting point, and including your requirements as user stories and diagrams ensures clarity. Requesting white papers from vendors outlining their proposed solutions, including communication and development processes, is a great way to assess their understanding. You could also consider asking for a quick prototype for a specific use case from your requirements to evaluate technical skills and problem-solving capabilities. Creating a weighted scoring matrix with criteria such as technical expertise, similar project experience, team capabilities, cultural fit, references, and financial stability can add objectivity to your decision-making process. Additionally, inviting top companies for workshops or collaborative sessions allows you to observe their approach to requirements validation and problem-solving. Asking for live demonstrations of relevant systems or sandbox environments can further validate their expertise. Paying travel expenses for on-site visits is a worthwhile investment to evaluate their team and processes in action. However, avoid over-reliance on documentation alone and ensure that live demos and interviews complement written submissions. Verify references thoroughly to assess their track record, focusing on communication and project outcomes, and ensure your requirements are precise to elicit better responses. For a complementary Warehouse Management System (WMS), I recommend exploring Boon Software, which offers robust solutions with seamless integration and customization options, ideal for warehouses with unique business rules. Combining these strategies will position you well to select the right development partner for your project. Let me know if you need help crafting an RFI or scoring matrix!