It’s a truism in software and services negotiation: suppliers are more willing to make special deals and terms concessions as their financial years and quarters end. But clients all too frequently fail to make use of this information – to start your preparations with enough lead time, to use the very real supplier deadline in your favor. To help you organize your plans, we’ve listed the Fiscal Year end dates for a number of major suppliers in this table. Take a few moments to mark your calendars with at least three months’ lead time to get in touch with NET(net) to maximize your value from the supplier Fiscal Year ends. Accenture 31-Aug CGI ...
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NET(net) posed the question on Twitter one day: “How does the Software & Information Industry Association (SIIA) have the authority to audit software license use?” In thousands of license transactions, we’ve never given them that right. Learn your software audit rights in this blog. We were looking for some insight that we might have missed. In the world of contracts, your license grant will actually call out specific provisions regarding who has the ability to audit your license usage (if any ability is so granted). In the world of contract law, the term “standing” is used to show who actually is allowed to raise a particular issue (via ...
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Let’s face it, outsourcing is a way of life these days, but it is flawed especially in the area of contractual agreements. No matter when you did your agreement, it’s time to check for and mitigate the Five Fatal Flaws. I’ve seen a lot of outsourcing agreements, and most of them are simply not sustainable. They suffer from one or more of these fatal flaws:[spacer height="20px"] 1. Communication For one reason or another, most organizations don’t communicate well. The world changes and those changes usually mean alterations in the goals of an outsourcing agreement. Effective and regular communication is essential to make sure the changing ...
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Many of NET(net)’s clients are finding that the deals they once negotiated are no longer sustainable and, as a result, they are spending more time renegotiating legacy deals than they are negotiating new deals. There are many perils of trying to renegotiate a deal. If there are disproportionate benefits to the supplier, their general view is to try to hold on to those benefits. Any attempts to try to remedy these inequities usually result in bitter disputes. Even though most agreements contain language governing disputes, including facilitative mediation, arbitration, and litigation, most disputes are settled with informal escalation that ...
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Think about the last large thing you purchased. A house, a car, a boat, or, sure, even software. Do you remember the price? Do you remember the number YOU last offered? Would it surprise you to know that more than 70% of the time, it's a round number? And of those round number times, more than 80% of the time, the last several digits (depending on the size of the number) are zeros? This is because, generally speaking, humans love orderly things, including numbers. Round, whole numbers are easy to deal with in your head. They also don't mask change as well. For example, most people would rather say "$2,500,000" than "$2,494,293". In fact, we ...
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Governance of outsourcing agreements can be complex and challenging. There are ways to simplify the governance process, however, by crafting agreements which take into account the business drivers, tolerances and environments of both the client and the supplier. It is interesting to note that many (if not most) organizations seeking to (re)negotiate their outsourcing (and other IT-related) agreements typically only do so every few years. Changes in the marketplace from supplier tolerances and market value perspectives are fast and furious. That said, doesn’t it make sense to level the playing field? Bringing in an agnostic outsourcing ...
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Clients dealing with complex issues generally understand there is no such thing as “Too Much Information”. Our world’s information is currently doubling every two years, and in 2010 alone, we created more information than in all of recorded history. This ongoing data explosion inundates all our clients, but can also be an enormous opportunity. NET(net) specializes in IT Investment Optimization, an area where the information is convoluted, the answers are obfuscated, and the rules are unintelligible. In our world of supplier marketing presentations, supplier pricing models, supplier support policies, and supplier contract provisions and ...
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For many years, so-called industry experts have advocated reverse auctions as a means to commoditize highly differentiated solutions like we often see in technology buying. The thought is to document your requirements, build an ‘apples-to-apples’ comparison of multiple solutions, and reverse auction the buying process to get the best price. Proponents suggest that these techniques will ‘devalue’ the differentiations of the competing solutions, and Clients will benefit from increased economic value at the point of purchase. However, our research seems to contradict this so-called conventional wisdom. As NET(net) has compared the results of ...
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Are you familiar with one of the ugliest spats in Silicon-Valley – Oracle vs. HP? If not, I would be surprised, as most of their dirty laundry has been airing everywhere other than in private. These two former ‘partners’ used to pitch a best of breed strategy while competing directly against the likes of IBM, and told customers to buy HP servers and Oracle software, instead of buying bundled solutions from IBM, because they made better respective point solutions, and by partnering together, their bundled solutions were performance optimized, and due to their strategic collaboration, their service and support was every bit as good as IBMs. ...
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IT contracts: getting them right the first time sounds simple enough. But in a cyclic economy, organizations often realize too late that they do not have correct contract governing dials, and given a fundamental change their business, they are unable to adequately control costs. For example, an organization may realize that because of downsizing, they own more licenses than they actually deploy, and want to reduce the license maintenance. Not so fast. For example: A client, who three years prior, bought 4,000 licenses of enterprise software and was only using 3,000 may want to cancel support on 1,000 licenses. The client was paying $4 ...
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