IT system procurement is not just negotiating the lowest licence fee
Negotiating and procuring a new I.T system is not a simple process and can be a very daunting experience.
Negotiation and procurement is a very important stage in selecting and implementing a new I.T system, and it is crucial that sufficient effort and time is assigned to this process. It is key to realise that this process is not just about negotiating the lowest licence fees and day rate, there are many factors that need to be considered, negotiated and agreed. Many of these factors are not always obvious, and often omitted in initial vendor quotes. Some examples of factors that need to be considered are:
- Software License
- 3rd Party Licenses
- Reporting
- Additional Modules
- ESCROW
- Enterprise Agreement
- Training
- Future License Amendments
- Payment Terms
- Additional Companies \Territories
- SLA and Penalties
- Implementation
- Maintenance
- Hosting
- Future Consultancy
- Future Hosting Amendments
- Support
It is also important to understand you are not just negotiating an agreement and pricing for your business today, but also for your future business scenarios i.e., what is the cost impact if your employees double or halve? what happens if you acquire a new business that you want to associate previously purchased licences to? what happens to the system if the vendor goes out of business?
At Ballards, we have expert real-life experience of negotiating and procuring I.T systems. We work with our clients to understand what is being negotiated and the areas that should be considered. We can also assist by advising of any pricing anomalies and on typical market prices.
For more information on our procurement assistance service please contact sean.devlin@ballardsllp.com
