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Master Contract Review and Negotiation for Software Agreements
Optimize spend with significant cost savings and negotiate from a position of strength.
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Contributors
- Christiaan Murphy, Global Software Category Manager at CGI
- Jeffery I. Gordon, SVP, author of Software Licensing Handbook & Mortgage Lending Vendor Operations Manager at BT&T
- David W. Tollen, Attorney at Law & Founder at Sycamore Legal, P.C.
Your Challenge
- Internal stakeholders usually have different – and often conflicting – needs and expectations that require careful facilitation and management.
- Vendors have well-honed negotiating strategies. Without understanding your own position and leverage points, it’s difficult to withstand their persuasive – and sometimes pushy – tactics.
- Software – and software licensing – is constantly changing, making it difficult to acquire and retain subject matter expertise.
Our Advice
Critical Insight
- Conservatively, it’s possible to save 5% of the overall IT budget through comprehensive software contract review.
- Focus on the terms and conditions, not just the price.
- Learning to negotiate is crucial.
Impact and Result
- Look at your contract holistically to find cost savings.
- Guide communication between vendors and your organization for the duration of contract negotiations.
- Redline the terms and conditions of your software contract.
- Prioritize crucial terms and conditions to negotiate.
Start here – read the Executive Brief
Read our concise Executive Brief to find out how to redline and negotiate your software agreement, review Info-Tech’s methodology, and understand the four ways we can support you in completing this project.
1. Gather requirements
Build and manage your stakeholder team, then document your business use case.
2. Redline contract
Redline your proposed software contract.
3. Negotiate contract
Create a thorough negotiation plan.
Guided Implementations
This guided implementation is a six call advisory process.
Guided Implementation #1 - Gather requirements
Call #1 - Define business use case and build stakeholder team
Call #2 - Evaluate initial proposal
Guided Implementation #2 - Redline contract
Call #1 - Review terms and conditions
Call #2 - Validate requirements and incorporate into redlined contract
Guided Implementation #3 - Negotiate contract
Call #1 - Develop a negotiation strategy
Call #2 - Review final proposal
Book Your Workshop
Onsite workshops offer an easy way to accelerate your project. If you are unable to do the project yourself, and a Guided Implementation isn't enough, we offer low-cost onsite delivery of our project workshops. We take you through every phase of your project and ensure that you have a roadmap in place to complete your project successfully.
Module 1: Collect and Review Data
The Purpose
- Assemble documentation.
Key Benefits Achieved
- Understand current position before going forward.
Activities
Outputs
Assemble existing contracts.
Document their strategic and tactical objectives.
Identify current status of the vendor relationship and any historical context.
Clarify goals for ideal future state.
- Business Use Case
Module 2: Define Business Use Case and Build Stakeholder Team
The Purpose
- Define business use case and build stakeholder team.
Key Benefits Achieved
- Create business use case to document functional and nonfunctional requirements.
- Build internal cross-functional stakeholder team to negotiate contract.
Activities
Outputs
Establish negotiation team and define roles.
- RASCI Chart
Write communication plan.
- Vendor Communication Management Plan
Complete business use case.
- SaaS TCO Calculator
- Software Business Use Case
Module 3: Redline Contract
The Purpose
- Examine terms and conditions and prioritize for negotiation.
Key Benefits Achieved
- Discover cost savings.
- Improve agreement terms.
- Prioritize terms for negotiation.
Activities
Outputs
Review general terms and conditions.
Review license- and application-specific terms and conditions.
- Software Terms & Conditions Evaluation Tool
Match to business and technical requirements.
- Software Buyer’s Checklist
Redline agreement.
Module 4: Build Negotiation Strategy
The Purpose
- Create a negotiation strategy.
Key Benefits Achieved
- Establish controlled communication.
- Choose negotiation tactics.
- Plot negotiation timeline.
Activities
Outputs
Review vendor- and application-specific negotiation tactics.
- Contract Negotiation Tactics Playbook
Build negotiation strategy.
- Controlled Vendor Communications Letter
- Key Vendor Fiscal Year End Calendar
