Technology Negotiation

IT Negotiations: Last words of advice on professional services

Prepare for the RFP process properly or risk a ride on the upgrade train

Author: Phil Downe

TORONTO, June 1, 2018 – As part of this series for Canadian accountants on IT professional services (PS) contracts, I’ve taken you through a PS overview, the pros and cons of time and materials versus fixed-price contracts, and how to control your costs and deliverables. Now for a few last words of advice on professional services.

Your cloud solution will most likely preside in a multi-tenant environment. These versions of the software are designed to allow continuous upgrades or improvements to the underlying platform, without affecting any unique interfaces or pre-packaged or customized add-ons you might have added for your specific needs.

At least, that’s the brochure pitch. It doesn’t always work so seamlessly. Don’t be forced on to the “upgrade train” until your systems people have had ample time to test the new versions. Your own version may be technically walled-off from everyone else’s but the upgrades or changes to the underlying common platform may cause unexpected results with the way your interfaces are written or your software is configured.

Get specific in the RFP phase

Once you have all the requirements, you can break them down into the major tasks, prior to writing your request for proposals (RFP) for PS firms. If the project is large it might even be broken down into multiple phases.

You must be specific with your questions and avoid vague answers and equivocation. When you give a vendor a general question, don’t expect anything but a general answer. You must get specific — if you ask someone how to build a watch, make sure they don’t just tell you the time.

Regardless of who you are negotiating with, you must maintain leverage. If you leave the PS piece until late in the game — and the PS firm knows the subscription pricing and terms have been settled and you’re under pressure to sign due to time constraints — then your negotiating leverage will be low.

Interested in a free negotiation strategy webinar with negotiation specialist Phil Downe? Email editor@canadian-accountant.com and we will add you to our notification list.

Phil Downe is an independent IT negotiations specialist and principle with Relations Management Group Inc. based in Toronto. He can be reached at 416-804-7445 or Phil.Downe@ITnegotiations.com.

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