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Published on February 22, 2010 by R "Ray" Wang

Order cheap iressa online, Apps Users Seek Third Party Maintenance For Cost, Value, and Service

Updated surveys from inquiries, client conversations, and user group meetings show a 113.8% increase in interest in third party maintenance (3PM) services from Q3 2009 to Q1 2010 (see Figure 1).  Key factors stem from (see Figure 2.):


  • Continuing cost pressures. Louisiana LA, Budgets continue to be at flat or have been reduced.  Organizations must do more with less.  Add pressures to innovate, CIO's must find fat without trimming bone.

  • Gaining minimal value in maintenance services, West Virginia WV W.Va.. Buy arimidex online legally, Most felt they were paying too much for too little.  An 8 point jump reemphasized the issue with a lack of tiered offerings.

  • Declining plans to upgrade. Worsening economic conditions from Q3 2009 to Q1 2010 led a 27 point increase in interest in 3PM.  Expect many respondents to change their point of view (POV) as economic conditions improve.

  • Expecting better service, cytoxan ordine on-line. Kjøpe billig epogen, Service continues to play a key factor in decisions to go to 3PM.  Over 60% of respondents had experienced poor levels of service.

  • Slowing pace of vendor innovation. Greater than half of respondents believe their vendor has been too slow to deliver new capabilities, order cheap iressa online. These include SaaS deployment options or key functionality in areas such as strategic HCM and social CRM.

  • Disliking the vendor, Maryland MD Md.. Buy iressa, About 1/3 of the survey respondents have bad experiences with their vendor.  Many times it comes from sales person or support rep experiences.

  • Delivering self support. Almost 30% of respondents already provide their own support.  These organizations have no need to pay maintenance when they are doing all the work.


Figure 1, order arimidex without prescription. Order capecitabine online cheap, Interest in 3PM grows 113.8% over 2 quarters.

screen-shot-2010-02-20-at-44436-pm


Figure 2. Order cheap iressa online, Cost Pressures, Value, And Decision Not To Upgrade Drive Current Trends to 3PM

screen-shot-2010-02-20-at-44448-pm


Limited Options Exist For Most Enterprise Apps Customers

Of the 101 respondents in Q1 2010 interested in 3PM, Oracle (88.1%) and SAP (76.2%) users expressed the greatest interest in seeking independent services (see Figure 3).  Over 80% of the users were from large companies greater than 1000 employees across the globe.  Most SAP users surveyed have mixed environments with Siebel, JD Edwards, and PeopleSoft joint installations.  Unfortunately, very few public options exist for sole SAP users (see Figure 4).  For example, SAP customers can only turn to Rimini Street.  Oracle customers on PeopleSoft, JD Edwards, and Siebel also have limited choices with Rimini Street, netCustomer, and Spinnaker among the options.  IBM, Infor, Lawson, Computer Associates, Epicor, Microsoft Dynamics, Oracle E-Business Suite and database customers have no options.  (Note: This data may not be completely statistically significant given the sample size of 240, but hopefully it provides some directional input.)

Figure 3. Oracle And SAP Users Drive Interest In 3PM

screen-shot-2010-02-20-at-44457-pm


Figure 4, Illinois IL Ill.. Cheap zometa online without prescription, Very Few Public Options Exist For Customers

screen-shot-2010-02-20-at-100912-pm


The Bottom Line For Users - Users And User Groups Must Band Together To Guarantee 3PM Rights. Don't Take These For Granted, buy evista online. αγοράζουν online arimidex,

Although the latest surveys show a 17 point increase in the belief that 3PM is a right, this right is under fire by big vendors such as Oracle who have taken legal actions against 3PM providers for improperly (i.e, farmacia evista barato. TomorrowNow) and allegedly (i.e, order cheap iressa online. Um casodex online, Rimini Street) violating intellectual property rights.  If providers have violated such laws, Oracle rightfully should defend its positions and those providers be punished.  However, cheap gleevec tablet, Epogen pill, there's a lot of money at stake.  For most vendors, maintenance represents 50% to 80% of their revenue stream.  Consequently, iressa without a prescription, Nebraska NE Nebr., users and user groups have a responsibility to:


  • Demand that their contracts include provisions that protect their right to 3PM

  • Require vendors to work out rules on how 3PM providers can deliver services without violating software IP provisions

  • Seek anti-trust class action with the US DOJ (i.e. Christine A, cheapest zometa price. Washington WA Wash., Varney) and the EU Compeition (i.e. Joaquín Almunia) against software vendors who hinder 3PM providers from providing services


Users and user groups must vigorously defend their positions in contracts and legal action or lose this right.  Failure will result in a continued software maintenance monopoly.  Success will ensure market competition and renewed innovation.  Attention: OAUG, District of Columbia DC D.C., Order epogen online, Quest, and SUGEN leadership your members need your help, Hawaii HI.
Figure 5.  A Growing Body Of Users Believe 3PM Is A Right

screen-shot-2010-02-20-at-44509-pm


The Bottom Line For Vendors - Proactively Address The Issue Or Expect A Groundswell Of Activism
 Order cheap iressa online, SaaS, subscription pricing, 3PM, and the economy provide a confluence of forces that will continue to attack maintenance revenue streams.  Many legal cases have been fought over this issue including IBM vs Amdahl and Geac vs Grace Consulting.  SAP's failed attempt to convince customers on the value of Enterprise Support led to a public relations disaster and a factor in the resignation of their CEO.  The result - many vendors considering price hikes held back.  In fact, some savvy software vendors retooled and restored the client -vendor relationship by:

  • Offering more entry points and tiers to support options. Ostaa halvalla evista, The three pillars of software maintenance and support policies still apply.  However, several vendors are now offering more tiers of support as lower entry points.  Two vendors have finalized plans to offer just the bare bones legal and regulatory updates.  Other vendors have made it easier to come back with maintenance amnesty plans.

  • Providing flexible maintenance policies. Vendors who change rigid policies have experienced success among customers.  Some Both Infor through Infor Flex and Micrsoft Dynamics allow like for like swap credits to migrate between existing products.

  • Renegotiating existing terms. Some vendors are helping clients meet the realities of the current market conditions. Big on the list is helping clients address shelf ware without repricing of contracts.  For clients who paid full maintenance on software that’s at least 4 years old, some vendors are offering to reduce up to 20% of the overall licenses not in use.  This leads to lower maintenance revenue but engenders good will among key clients.  Further, several vendors have allowed clients to apply credit towards another module as an alternative.

  • Delivering amnesty programs. Several vendors have allowed customers to return to maintenance programs after years of not paying.  Such programs play a key role in helping customers upgrade but should be used sparingly as customers may become accustomed to this practice.

  • Creating better peer forums to share information. Almost every vendor surveyed has a program to improve the online support capabilities.  Applying Social CRM use cases,  user generated content in peer forums tops the list of initiatives.  Other plans focus on sharing data on benchmarks, operational metrics, and best practices.

  • Assisting with vendor financing, order cheap iressa online. Clients seek access to financing, especially many in the mid-market who’s credit lines have been zapped.  Microsoft has led the charge by providing 0% financing for its Microsoft Dynamics ERP and Microsoft Dynamics CRM Customers.  Other vendors such as IBM, Infor, Oracle, SAP, Sage also offer vendor led financing programs that include hardware, implementation, training, and other services.

  • Lowering cost of usage and ownership. Though tops on the list as a conceptual practice, most vendors will need to roll out such initiatives over the next 24 months.  A few notable exceptions include Agresso with its VITA architecture which allows customers to rapidly make business and UI changes, Microsoft Dynamics customers who report back significantly lowered implementation and training costs compared to most vendors, and Epicor customers who report significant productivity gains with Service Connect.  SaaS customers already experience such gains.


Your POV

Take the new and improved survey on 3rd party maintenance and let us know if you need help with your enterprise apps strategy by:


  • Conducting an ROI on 3rd party maintenance options

  • Identifying cost reduction opportunities

  • Renegotiating your software contracts

  • Improving innovation via SaaS and other deployment options


Please post or send on to rwang0 at gmail dot com or r at softwaresinsider dot org and we’ll keep your anonymity.
Related resources and links

20091008 Deal Architect - Vinnie Mirchandani "Third Party Maintenance Is Really 4 Decades Old"

20071120 News Analysis: Too Early to Call the Death of Third Party Maintenance

20090210 Tuesday's Tip: Software Licensing and Pricing - Do Not Give Away Your Third Party Maintenance And Access Rights

20090709 Tuesday's Tip: Do Not Bundle Your Support and Maintenance Contracts.

20090622 News Analysis: Infor Flex Reflects Proactive Maintenance Policy

20090516 News Analysis: Rimini Street Launches Third Party Maintenance for SAP

20090504 News Analysis: Oracle Waives Fees On Extended Support Offerings

20080909 Trends: What Customers Want From Maintenance And Support

20080215 Software Licensing and Pricing: Stop the Anti-Competitive Maintenance Fee Madness

20090428 News Analysis: SAP and SUGEN Make Progress on Enterprise Support

20090405 Monday's Musings: Total Account Value, True Cost of Ownership, And Software Vendor Business Models

20090330 Monday's Musings: It's The Relationship, Stupid. (Part 2) - Stop Slashing The Quality Of Support And Maintenance

20090324 Tuesday's Tips: Five Simple Steps To Reduce Your Software Maintenance Costs

20090223 Monday's Musings: Five Programs Some Vendors Have Implemented To Help Clients In An Economic Recession

20081012 Monday's Musings: 5 Steps to Restoring Trust in the Vendor - Customer Relationship

20100114 News Analysis: SAP Revives Two Tier Maintenance Options

20091012 Research Report: Customer Bill of Rights - Software-as-a Service

20090912 News Analysis: Siemens Cancels SAP Maintenance Contract

20090910 Tuesday's Tip: Note To Self - Start Renegotiating Your Q4 Software Maintenance Contracts Now.

20090602 Tuesday’s Tip: Now’s The Time To Consider SaaS Software Escrows


Copyright © 2010 R Wang and Insider Associates, LLC. All rights reserved.

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Buy Capecitabine Online Cheap

Published on November 30, 2009 by R "Ray" Wang

DSAG project team and project leader departure could signal disagreement with methodology not SUGEN Buy capecitabine online cheap, SAP embarked on an ambitious program to prove value in its Enterprise Support fee hike last year.   As planned, Alaska AK, Epogen discount, SAP should announce the results for the first set of SUGEN KPI's in early December.  However, two key SUGEN KPI project sponsors (revised 11/30/2009) team members have left from the German SAP user group (DSAG).  Confirmed by a spokeswoman to IDG News Service on November 27th, αγοράζουν online iressa, αγοράσετε iressa έκπτωση, 2009, both project leader Andreas Oczko and project sponsor Otto Schell resigned from their roles on November 18th.  Several outcomes may potentially have led to this departure:


  1. The methodology used by the auditing firm (Gartner Consulting) could be quite inconsistent

  2. Teams may not have had enough time to review the data to check for statistical errors.

  3. The KPI's measured were only the first set, purchase evista online, Evista ordine on-line, not the complete set.

  4. A few months does not provide enough trending data

  5. SAP's attempting to announce results prior to when 90%+ of its maintenance renewal occurs in Q4


To be clear, DSAG remains a SUGEN member and has not pulled out of the group or project.  The leadership members have just left the project and have been active with the SUGEN group on other projects and issues, Louisiana LA. Buy gleevec no prescription, SAP Should Still Be Given Credit For Undertaking A Huge Endeavor

Despite attempting to raise get away with a large (revised 11/30/2009) maintenance fees hike in the middle of one of the worst global recessions, the SUGEN agreement with SAP is a good faith gesture and a step in the right direction.  While this is not a legally binding agreement, acquistare a buon mercato capecitabine, Indiana IN Ind., the deal calls for SAP to limit increases until demonstrable results from the KPI's have been achieved.  This is not an easy challenge but a few props should go out to SAP because:


  1. SAP's embarking on a risky but unique program to show value

  2. Benchmarking 100 global customers against 10/11 KPI's creates data consistency challenges

  3. Agreeing to present results in the face of public opinion takes courage


The Bottom Line For Users -  Remain Vigilant And Compare SUGEN Results With Your Own

SAP customers should work with their user groups to understand the methodology used and gain access to the underlying data with these 100 customers.  Keep in mind SAP's Value Academy already has benchmarking data for a broader set of customers.  The result - selection of the 100 customers by the user groups will significantly impact the outcome.  Users should see how their situation fares compared to the benchmarks to gauge their own potential value achieved from SAP's Enterprise Support

The Bottom Line For Vendors - Provide Customers With Tiered Maintenance Plans

Pressures from SaaS deployments and mid-market competitors will erode the 70 to 80% margins in maintenance fees.  Customers will begin to demand third party maintenance options and include such protections in future contracts.  Those vendors who keep tiered maintenance based on the life of the product in production will engender the most loyalty by providing customers with the right balance between sustaining maintenance and incentives to upgrade.  At the end of the day, customers have to migrate on their own terms.  Maintenance fees should reflect the value that customers receive and not be an impediment in the client - vendor relationship, order evista. Oregon OR Ore., Your POV.

If you get a chance, let us know:


  • Which SAP products do you use?

  • What do you think about the progress on SUGEN KPI's?

  • Are you considering alternatives to SAP?

  • Do you feel SAP is innovating fast, arimidex price, Missouri MO Mo., ok, or slow enough?


Feel free to post your comments here or send me an email at rwang0 at gmail dot com or r at softwareinsider dot org, αγοράσετε capecitabine έκπτωση. För iressa online, Copyright © 2009 R Wang and Insider Associates, LLC, Kansas KS Kans.. Bestill epogen online, All rights reserved. Buy gleevec online legally. Köpa rabatterade casodex. Price of epogen. Køb billige arimidex. Buy iressa pill. Ordering cytoxan. Capecitabine pedido en línea.

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Order Arimidex Without Prescription

Published on November 25, 2009 by R "Ray" Wang

Building Innovation With And Around Your SAP Environment

Location: Manchester CentralAuditorium
Date:23/11/2009
Start Time: 16:25
End Time: 17:00
Speaker: R "Ray" Wang
Company: Partner with Altimeter Group

Keynote summary:


  1. Order arimidex without prescription, Pace of change continues to increase in market forces, work dynamics, business models, and pace of technology adoption.

  2. Innovation is essential in this market.

  3. There's a tonne of innovation at SAP. Iowa IA, Management and politics keep it from coming out.

  4. Users need to tap into innovations from SAP and also help SAP prioritize what should go to market.

  5. Users need to know what you want to do before you even talk to SAP.  Get your act together.

  6. Use the user group to build the linkages to SAP.  This is a better, more productive approach, ordering casodex without prescription, District of Columbia DC D.C., especially if you are not a top 400 customer with private access.

  7. SAP isn't bad or good. You can't view them that way, Arizona AZ Ariz.. Ordering epogen online without prescription, Management is confused at the moment on leadership, direction, North Dakota ND, Ordering arimidex online without prescription, and innovation so figure out what you need from them early and fast.

  8. If SAP can't do it, you don't have time to wait for them, South Carolina SC S.C., αγοράζουν φτηνά cytoxan, especially if there's no commitment. SaaS is an option, ordering gleevec overnight delivery, Idaho ID, other providers are out there.  Come back to them later when they figure it out.

  9. The pace of change is too fast. Technology adoption too slow, order arimidex without prescription. Companies need to keep moving in innovation.

  10. Invest in innovation even if it hurts, Nebraska NE Nebr.. Købe evista, Find money to optimize and pay for this.  There are a number of vendors that can assist.


Members of the SAP UK &I user group who would like a copy of the presentation can contact David Stanley, Vice President of Business Development and Sales at david@altimetergroup.com for copies.   Your member number will be required for proof, order cytoxan from canada. Cheap capecitabine tablet,

Video Highlights - Exposing SAP Innovation


Courtesy of Dennis Howlett

Video Highlights - On ESME vs Salesforce.com Chatter


Courtesy of Dennis Howlett.

Video Highlights - 5 Recent Failures of SAP


Courtesy of Dennis Howlett, epogen ordine on-line. Cheapest cytoxan in the world, Copyright © 2009 R Wang and Insider Associates, LLC, Acheter en ligne casodex. Acheter gleevec discount, All rights reserved.

Additional coverage and related links

Event Report: UK & Ireland User Group Conference 2009


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Order Zometa Online Cheap

Published on November 24, 2009 by R "Ray" Wang

SAP users in UK and Ireland remain equally skeptical about SAP

Order zometa online cheap, (Photos by R Wang & Insider Associates, LLC.   Copyright © 2009 All rights reserved.)


The SAP user group hosted its annual event.  Conversations with 37 clients reflect the following broad trends in the UK and Ireland:


  • SAP users remain skeptical about benefits promised by SAP due to lack of delivery over the past 5 years (See Figure 1.)

  • SAP has spent more time reaching out to customers to understand pain points

  • Knowledge gaps continue to exist between what SAP users know about SAP and what SAP sales people communicate to clients

  • A show of hands in the audience validates conversations that SAP users have not adopted NetWeaver, order iressa without prescription, Comprar gleevec barato, Duet, ByD, kjøpe gleevec, Arimidex farmacia a buon mercato, Solution Manager, and Enterprise Support.

  • Many customers have budget but need trusted advice as to what is possible in including SAP in their future roadmaps

  • Customers seek innovation from SAP but find a difficult time understanding what SAP has to offer

  • Many customers have turned to other providers for innovations via SaaS or cost optimization


Figure 1, Oregon OR Ore.. Ostaa halvalla zometa, What SAP Customers Want

What SAP users want from SAP


The bottom line.

SAP users and their user groups have a unique opportunity to put in the right infrastructure to engage in productive partnership with SAP.  The management team has shifted their outlook.  Early signs indicate a more customer focused approach may be on the way.  Customers seeking to innovate within their SAP investment should ask hard questions about what is in the SAP Labs portfolio.  User groups will play a key role in helping to prioritize future SAP product road map investments.  Users and their user groups should push for frameworks that monitor customer reuqests and increase transparency in the prioritization process. Customers can not allow SAP to squander any more of the 10's of billions in maintenance fee and license fees "invested" with SAP, Hawaii HI. Arimidex online cheap, Your POV.

If you get a chance, let us know:


  • Which SAP products do you use?

  • When will you migrate to BS7 or ECC 6.0?

  • What do you think about the progress on SUGEN KPI's

  • Are you considering alternatives to SAP

  • Do you feel SAP is innovating fast, buy zometa without prescription, Iowa IA, ok, or slow enough?


Feel free to post your comments here or send me an email at rwang0 at gmail dot com or r at softwareinsider dot org, ordering cytoxan without prescription. Cheap iressa no prescription,

Copyright © 2009 R Wang and Insider Associates, LLC, Ohio OH. Order casodex no rx, All rights reserved.

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Buy Epogen

Published on October 12, 2009 by R "Ray" Wang

Connect.  Collaborate.  Innovate. Buy epogen, Welcome to the first of many Altimeter Group research reports.  Before you dive deep into the Customer Bill of Rights: Software-as-a-Service report, we wanted to share with you a bit about the research process and how we work within the community. Ordering cytoxan online cheap,


  • Connect.  We strive to bring new people together and share our knowledge.  Knowledge has no value unless others can put it to use.

  • Collaborate.  We believe in open collaboration with the market and ecosystem of thought leaders, influencers, αγοράσετε evista, Ordering arimidex online cheap, solution providers, and implementation experts.  In collaboration do we foster new relationships and opportunities to solve client problems.

  • Innovate.  We are thinking about what's next.  SaaS deployments and web-based solutions represent the future and we'll be looking for the next set of innovations.


Customer Bill of Rights - Software-as-a Service

Enjoy this report, ordering gleevec online. Buy generic epogen, It's been placed in Scribd for shared use.

AG Customer Bill of Rights - SaaS - Live

Use, Maine ME Me.. Comprare evista sconto, Share. Remix.
Creative Commons License
Customer Bill of Rights: Software as a Service by R "Ray" Wang is licensed under a Creative Commons Attribution-Share Alike 3.0 United States License, buy epogen.
Based on a work at blog.softwareinsider.org, kjøpe billig casodex. Indiana IN Ind., Permissions beyond the scope of this license may be available at http://blog.softwareinsider.org.

Continue The Discussion On Linked IN

We've crepic_logo_119x32ated a group that you can join now that will carry the conversation further.  Sign up now and stay tuned for when the report goes out.  Look for more Bill of Rights to come. Customer Bill of Rights

Your POV.

Want to be part of the collaborative research process?  Got ideas for topics that should be reports?  Feel free to post your comments here or send me an email at rwang0 at gmail dot com or r at softwareinsider dot org, cheap gleevec. Maine ME Me.,

Copyright © 2009 R Wang. All rights reserved.

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Order Zometa

Published on October 8, 2009 by R "Ray" Wang

This post has been cross posted on the Enterprise Advocates blog

A New Way Of Creating Research - Collaborative Input And Review Order zometa, Some time early next week, we (i.e. Altimeter Group's Jeremiah Owyang and I) will be publishing a Customer Bill of Rights - Software-as-a-Service.  Through the generous input of 57 collaborators and organizations, kopen goedkope cytoxan, New York NY N.Y., this document will serve as a reference, checklist, Connecticut CT Conn., Acquistare a buon mercato gleevec, and point of discussion with SaaS vendors for prospects and clients who have made the decision to begin a SaaS deployment.

Why A Customer Bill of Rights for SaaS, casodex ordine on-line. Kentucky KY Ky.,
SaaS deployments have entered the heart of the business and now deserve to be treated with all the rigor and due diligence of on-premise licensed software. Client - vendor relationships in SaaS are perpetual and it is imperative that these agreements provide a chance for a new slate, köpa billiga capecitabine. CIO's, CMO's, LOB execs, procurement managers, and other organizational leads should ensure that the mistakes they made in licensed software aren't blindly carried over, order zometa. Billig iressa apotek, The SaaS Bill of Rights (BoR) provides a tool for clients and vendors to change the tenor of contract negotiations from subservient to equal partnership.  Though not all these rights may be provided by the SaaS vendors today, these rights represent the best practices in over 250 SaaS contracts and reflect the general spirit and intent of most SaaS vendor's executive management teams, köpa rabatterade capecitabine. Billige zometa Apotheke, Thanks To Creative Commons For A Great Legal Platform For Collaboration

88x31 Creative Commons is a nonprofit corporation dedicated to making it easier for people to share and build upon the work of others, consistent with the rules of copyright.  They provide free licenses and other legal tools to mark creative work with the freedom the creator wants it to carry, buy cheap evista, Bestill arimidex online, so others can share, remix, zometa kopen, Ordering zometa from canada, use commercially, or any combination thereof.  We'll be setting up the license as a Creative Commons | Attribution| Shared Alike.  This means anyone can remix, Louisiana LA, Iressa for sale, tweak, and build upon this work even for commerciadonate-banner-skinnyl reasons, ordering arimidex online, Tennessee TN Tenn., as long as they credit us and license their new creations under the identical terms. This license is often compared to open source software licenses, cheap gleevec online legally. Cheap evista, All new works based on this one will carry the same license, so any derivatives will also allow commercial use.   If you get a moment, acheter cytoxan discount, Where to buy epogen, please donate to these guys.

Props To Collaboration And Great Ecosystem Input Order zometa, The Customer Bill of Rights: Software-as-a-Service report could not have been produced without the generous input from these individual influencers and the following vendors who have shown a keen interest in transforming the client-vendor relationship. Please keep in mind, buy gleevec overnight delivery, Arizona AZ Ariz., input into this document does not represent a complete endorsement of these rights in total by the individuals or vendors listed in this report.


The Thanks List: Star Influencer And Guru Inputs
Nenshad Bardoliwalla
Naomi Bloom, order evista from canada, Bloom and Wallace
Kevin Dobbs, Montclair Advisors
Bob Evans, TechWeb
Dennis Howlett, Enterprise Irregulars
Phil Fersht, Horses For Sources
Christian Gherorghe
Paul Greenberg, The 56 Group
James Governor, Red Monk
Erin Kinikin
Esteban Kolsky
Amy Konary, IDC
Michael Krigsman, Asuret
Frank Scavo, Computer Economics
Josh Weinberger, CRM Magazine


The Thanks List: SaaS and Solution Vendor Input

Agresso
Appiro
Boomi
Blue Wolf
Cisco Systems
CODA
Demand Media
Epicor
Everest Software
Flexera
GetSatisfaction
HelpStream
IBM
Infor
Informatica
Infosys
Intacct
Intuit
Jive Software
KickApps
Lithium
M-Factor
Microsoft
Mzinga
NetSuite
Panaya Inc
Patni
Pervasive Software
RightNow Technologies
Rimini Street
Salesforce.com
SAP
Social Text
SoftBrands
SuccessFactors
Sugar CRM
Telligent
Tenrox
Ultimate Software
UserVoice
VMWare
Workday


Continue The Discussion On Linked IN

We've crepic_logo_119x32ated a group that you can join now that will carry the conversation further.  Sign up now and stay tuned for when the report goes out.  Look for more Bill of Rights to come. Customer Bill of Rights


Your POV.

Want to be part of the collaborative research process?  Got ideas for topics that should be reports?  Feel free to post your comments here or send me an email at rwang0 at gmail dot com or r at softwareinsider dot org.

Copyright © 2009 R Wang. All rights reserved.

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Tuesday’s Tip: Call Vendors On Their Bluff About “Rev-Rec” And Software Maintenance Contracts

Published on September 29, 2009 by R "Ray" Wang
Vendor Sales Reps Keep Using An Age Old Excuse Out Of Habit Many organizations start their Q4 software maintenance renewals process in September.  This has led to a flurry of emails and phone calls about revenue recognition (a.k.a. "rev-rec") rules for software maintenance contracts.   Apparently, both customers and vendor sales reps suffer from mass confusion on this issue.  The result - a conservative but inaccurate stance from sales reps who use pat answer number 1 and tell existing customers that they can't discount their software maintenance because of rev-rec rules.  For good measure, they usually throw out all the real official sounding terms around AICPA Statement of Position (SOP) No. 97-2 and VSOE.  To customers, this reminds them of technical gobbleydegook and they glaze over this issue about software revenue recognition in despair. However what's true for how rev-rec works for license fees does not apply in most cases for software maintenance and support because:
  • Maintenance and support fees are adjunct or known as separate from license fees. Maintenance contracts may be based on license fee costs but these fees should be recognized as a separate stream of revenue.  More granular accounting will be required when licenses are bundled with one or more years of pre-paid maintenance, but the vendor should be able to carve out a value for this.
  • Post contract customer support (PCS) or what we call maintenance and support is ratable. Maintenance fees are recognized over the life of a contract.  For example, if you got a 1 year contract, then that's all you impact, not the entire license basis as some vendor sales reps would have you believe.
The Bottom Line - Call The Bluff And Ask The Sales Rep To Show You How SOP-72 Is Applied* Countering false claims on rev-rec will provide a key weapon in reducing maintenance fees in contract negotiations.  Challenge the vendor to explain their rationale.  When successful, clients can then ask the vendor to base maintenance fees on a reduced total account value without jeopardizing the vendor's insistence to hold to a maintenance fee percentage. Your POV. Have you encountered the rev-rec song and dance?  How have you pushed back on this issue?  Did you find any success with this technique?  Need some guidance?  Feel free to post your comments here or send me an email at rwang0 at gmail dot com. *standard disclaimers apply.  always check with your legal counsel and procurement experts before taking any action.
Copyright © 2009 R Wang. All rights reserved.

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Vendor Event: Soft Summit 2009

Published on September 5, 2009 by R "Ray" Wang
Soft Summit 2009 Title: Vendor Event: Soft Summit Location: The Sheraton Palace Hotel, San Francisco, CA Link out: Click here Start Date: 2009-10-21 Start Date: 2009-10-22 Description: What is SoftSummit? Agility and Insight. Profitability Today! "SoftSummit has a great mix of practitioners, looking at licensing from an end-user and a vendor perspective and has a great deal of depth looking at these issues." SoftSummit 2009 is unlike any other conference you'll attend this year. It's the only conference that takes a laser-like look at licensing and entitlement technologies and the intersection between producers and the enterprises that manage and use their solutions. This year, more than ever, expect to be challenged, informed, and inspired to: * Navigate emerging licensing trends and issues * Drive fast ROI with practical techniques and best practices * Maximize efficiencies throughout the licensing and entitlement continuum * Achieve the profitability you want today SoftSummit offers common ground where peers and colleagues from software producers, device manufacturers, and enterprise IT come together to learn, discuss, network and brainstorm. SoftSummit 2009. It's time to join the conversation and the experience. Register

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Tuesday’s Tip: Note To Self – Start Renegotiating Your Q4 Software Maintenance Contracts Now!

Published on September 1, 2009 by R "Ray" Wang
Labor Day (US Holiday) traditionally marks the end of summer BBQ's, the beginning of the fall conference season, and yes, the time to begin a review of your software maintenance contacts that expire end of year.   As clients prepare for this seasonal ritual, a few trends in 2009 should set the stage for negotiations:
  • Continued weakness in the economy. Vendor revenues continue to decline as new license sales drop and vendors become more dependent on support and maintenance revenues.  Customers looking to upgrade or commit to new apps can expect vendors to be more generous on the support and maintenance front.
  • Dated and inflexible architecture of legacy applications. Change in business models, workplace dynamics, and macro economic conditions apply new pressures to aging systems purchased pre-Y2K.  Customers seek paths to upgrade but are limited by economic pressures.
  • Vendor awareness of customer discontent with existing support offerings. Customers now seek to understand what value vendors deliver in their support and maintenance agreements.  Many vendors have proactively responded by improving service or making appropriate concessions.
  • Growing acceptance of third party maintenance (3PM) options. Vendors such as Rimini Street and Spinnaker have proven to the market that they can deliver 3PM to an array of ERP applications.  Cutting maintenance fees by 50% or more can free up funds for innovation or pay for the next upgrade.
Align your apps strategy before negotiating contracts - do your homework Contract negotiations strategy should be planned in conjunction with an overall apps strategy.  Begin the process 2 to 3 months in advance.  Make sure the teams have the proper incentives in place.  Take the following steps as you prepare for your maintenance renewals: The bottom line - follow the seven simple steps to successfully negotiating software contracts.
  1. Ensure that the right team is in place
  2. Identify the organization’s key business drivers
  3. Determine the product adoption plan
  4. Consider contract strategy implications of the software ownership life cycle
  5. Align contract strategy with product adoption
  6. Identify leverage points
  7. Prioritize key contract objectives
Your POV Looking to hear your best practices with software maintenance contract renewals.
  • Is your maintenance contract up for renewal at the end of the year?
  • Do you need help putting a strategy in place?
  • Have you conducted an apps strategy assessment?
  • Would you like to break free from your vendor but don't know what options exist?
Post your comment here or reach me direct at r at altimetergroup dot com or r at softwareinsider dot org. Copyright © 2009 R Wang. All rights reserved.

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