Managing Your Technology Service Suppliers
Our recent articles have covered a range of contractual terms that help buyers protect the benefit for which they bargained in technology outsourcing and licensing agreements.
October 02, 2015 at 06:45 AM
6 minute read
Our recent articles have covered a range of contractual terms that help buyers protect the benefit for which they bargained in technology outsourcing and licensing agreements. This article continues that focus by addressing internal processes and controls that help buyers manage suppliers as well as specific contract terms that encourage excellent service throughout the life of the contract.
The balance of leverage often shifts to the supplier once the contract is signed, and even more so once the supplier begins performance under the agreement and the buyer begins to rely on the supplier's solution. The buyer's growing investment of time and money into the supplier's solution makes it difficult to change when the solution experiences problems, and the passage of time eliminates the possibility of achieving deadlines with a replacement supplier. Moreover, while managing its clients is a core competency for many technology service providers, many buyers have not yet developed the internal processes necessary to manage their suppliers.
A buyer can level the playing field with a trained vendor management team that can protect the buyer's interests under the contract. In too many cases, buyers leave contract management in the hands of the end users of the supplier's services. These end users are often employees whose training and experience does not include the interpretation or negotiation of complex commercial contracts. They are also often invested in the original decision to select the supplier.
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