Are You Managing Your Contracts the Right Way? – Do IT Right: Part 3
Welcome to “Do IT Right,” a 9-part series on how to succeed in the most important areas of IT management. In this series we introduce you to Simmons & Hawking, a fictional law firm that is scaling up its outdated IT infrastructure, and how the relatable challenges faced by their IT stakeholders. In part 2, we continued to journey along with their IT Manager, Ethan, who found out that sourcing was definitely not a one-person job. Now it’s on to his next step: contract management.
Ethan has sourced all of the best IT services and products for Simmons & Hawking Law Firm. He is confident the options he chose will allow his company to scale in the most efficient way possible and keep them competitive within the industry. Ethan meticulously made sure the solutions he chose stayed within his allotted budget for the project. His superiors made it clear staying within budget was a necessary component to the success of the IT infrastructure revamp.
Ethan begins to work with the finance and legal departments to hammer out the details of final pricing for each solution he chose. He also must ensure each solution is accompanied by a reliable and fair service level agreement (SLA).
A lot of back-and-forth is happening between Simmons & Hawking and the companies he chose services from, due to budget and terms issues. Ethan thought negotiating the best prices and terms for his company would be more straightforward. He realizes his lack of negotiating experience had landed him in a whirlwind of confusion – he doesn’t know the right things to say to get the best final contracts.
Once he begins to get final pricing back from those service provider, Ethan realizes that what he once thought was all within budget, actually isn’t; additional fees are required for key components. . To make matters worse, the service terms leave much to be desired and do not adhere to Simmons & Hawking’s business practices.
Ethan gets overwhelmed and feels defeated. It seems like all of this hard work and attention to detail has been thrown out the window.
This predicament means Ethan and his team must work further on negotiations with each service provider to come to a consensus on final contract details.
Ethan and his team have been trying to track each step of the process with each provider, but the process has become messy and disorganized quickly. The many people on Ethan’s team are each negotiating contracts and prices. Approvals for each are at different stages, and there is no clearly defined system to keep track of it all. In all the confusion, Ethan realizes he will stay nowhere near his target dates for implementation.
Like Ethan, all too many people underestimate the time and attention to detail required to ensure the smooth, organized, successful management of a contract negotiation. Companies tend to have a hard time managing all of the steps properly and in the most efficient way possible.
In order to make contract management successful, the focus should be on these few core principals:
- Negotiate for best pricing and service terms
- Leverage costs by aggregating options
- Organize contracts to expedite execution of agreements
Focusing on these areas will ensure you your project will get off the ground smoother and faster, without all of the headaches and unnecessary stress.
By using a structured platform that can keep track of the contract management process and having experts negotiate for you, you can maneuver through this complex process with ease and organization.
Contract Management is one of the 9 modules of vCom Solutions’ vManager platform. Fill out the form below to download our extended eBook on the topic!