Master Contract Review and Negotiation for Software Agreements
Optimize spend with significant cost savings and negotiate from a position of strength.
RETIRED CONTENT
Please note that the content on this page is retired. This content is not maintained and may contain information or links that are out of date.Software is essential to many major business functions, but the contract review process for licensing that software is a complicated, lengthy, and sometimes frustrating process.
- The terms that vendors put in contracts are not standardized.
- Vendors know how to capitalize on chronic IT capacity challenges.
- Every facet of your organization has its own agenda and requirements.
A careful contract review and negotiation plan will allow you to:
- Save approximately 5% of the overall IT budget through comprehensive contract review.
- Negotiate in a way that prioritizes your organization's needs, and reach an agreement with your vendor that takes into account both parties’ best interests.
- Build an internal cross-functional team across the organization that will negotiate your software contract as a team.
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Module 1: Collect and Review Data
The Purpose
- Assemble documentation.
Key Benefits Achieved
- Understand current position before going forward.
| Activities: | Outputs: | |
|---|---|---|
| 1.1 | Assemble existing contracts. |
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| 1.2 | Document their strategic and tactical objectives. |
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| 1.3 | Identify current status of the vendor relationship and any historical context. |
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| 1.4 | Clarify goals for ideal future state. |
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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: | |
|---|---|---|
| 2.1 | Establish negotiation team and define roles. |
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| 2.2 | Write communication plan. |
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| 2.3 | Complete business use case. |
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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: | |
|---|---|---|
| 3.1 | Review general terms and conditions. |
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| 3.2 | Review license- and application-specific terms and conditions. |
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| 3.3 | Match to business and technical requirements. |
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| 3.4 | Redline agreement. |
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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: | |
|---|---|---|
| 4.1 | Review vendor- and application-specific negotiation tactics. |
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| 4.2 | Build negotiation strategy. |
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