The UK
economy would be in much better shape if we all honed our
negotiating skills according to the January edition of business
publication, Director Magazine. But vendor and reseller
negotiations can be extremely fraught and complex and are often a
minefield to work through. More often than not this is because we
just don’t do the upfront preparation and due diligence before we
start discussions.
Here are four
key tips from FAST Ltd to help if you are about to negotiate a new
contract:
1. Preparing the ground
In FAST Ltd’s
experience, many companies just don’t prepare well enough for new
contract negotiations; they are often short of time and people with
the requisite skills and experience. If you are preparing for
vendor negotiations or a “true- up” with a vendor or facing a
vendor audit make sure that you do your preparation. Things to
consider include: checking your current contract, when is it due
for renewal? What are the terms and conditions? Do you have the
right contract in place – for example does it meet your current
requirements? Has anything changed within your IT estate which
isn’t now reflected in your existing contract? Do you think you are
over or under licensed? Have you had significant staff changes
whereby you might have the opportunity to reharvest licences? Are
your products in or out of warranty?
2. Have you checked out the
competition?
Once you have
considered what you want, have you properly scoped out your
requirement? How well do you know the vendor or reseller? What sort
of reputation do they have? Are any of your colleagues in the
industry working with them? Have you sought out competitive quotes
and have you made sure you are working with the right partner? If
working through a reseller, is this your approved reseller? Have
you considered whether you'll need experts like FAST Ltd by your
side to help you negotiate? Have you established and got approval
for your budget? Do you know what your bottom line is? All of
this has to be dealt with upfront rather than when you are in the
heat of the negotiations.
3. Have you got the right processes in
place?
Often it is not just
about the new software that you are buying but you also need to
check whether you have the processes in place to manage the
successful implementation of the technology into your business? A
discovery tool will only be as effective as the information that
you put into it and if you are not able to match the right
processes to support the software, then the chances are the
technology won’t be as effective as it could be. This is where
the FAST Compliance Programme can really help. As it gets
organisations onto the right track and makes sure that you have
effective and robust software asset management and compliance
processes in place.
4.
Don’t get hit with hidden costs
A successful
negotiation process results in both sides ending up with what they
want. If you want to work with the vendor or reseller again
don’t play hard ball or screw them down on price because the
chances are you won’t have a very fruitful relationship. Also be
aware that the product price can be misleading, because often, the
cheapest product might mean that you have to pay on top for
professional services to implement or unexpected maintenance costs
that you didn’t factor in at the outset. So make sure you check out
carefully what each vendor can provide so that you don’t to get hit
with hidden costs further down the line.
At
FAST Ltd we are here to help. This can either be with the upfront
preparation if you are facing a vendor audit or vendor ‘true up’ or
we can be on hand during the negotiations to help support your
position. To find out more call FAST Professional Services
and speak to one
of our trusted advisors on 0844 815 5742.