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Buy Cheap Evista Online

Published on April 13, 2010 by R "Ray" Wang

Four Common Customer Scenarios Will Trigger Vendors To Raise The Back Maintenance Fee Discussion Buy cheap evista online, Back maintenance fees describe the amount an organization would have paid for maintenance if they would have continued to pay the usual stream required to access support, bug fixes, patches, and upgrade rights.  As economic conditions have worsened, many organizations have turned to self-support, third party maintenance (3PM), or dropped support.  Discussions with 43 enterprise software customers reveal four common scenarios (see Figure 1):


  1. Scenario 1: Self supporting customers looking to upgrade to next release. Order zometa online cheap, Customers (44.19% n=19/43) in these scenarios typically run mature systems and are in businesses that do not face dynamic change .  They stopped paying maintenance years ago and rarely make major changes to the system.
    Catalyst:  Something happens in the business and the need to upgrade arises.
    Typical vendor response:     Upgrades can only be provided to customers who pay for maintenance.  Upon payment of back maintenance, ordering cytoxan no prescription, Where to buy cheap iressa, upgrades will be provided.  In some cases, vendors also levies a penalty.

  2. Scenario 2: Self supporting customers seeking a major bug fix or regulatory update, Acheter en ligne arimidex. Comprar evista de descuento, Organizations (27.91% n=12/43) in this dynamic have self-supported for years without incident but run into scenarios where their own teams can not resolve an issue.
    Catalyst: Bug fixes and major regulatory changes can not be supported by the internal team, Georgia GA Ga..
    Typical vendor response: Bug fixes and regulatory updates can only be provided to customers who pay for maintenance.  Upon payment of back maintenance, patches and regulatory updates will be provided.  In some cases, vendor also levies a penalty.

  3. Scenario 3: Customers shifting to third party maintenance (3PM) looking to future upgrade/replacement, buy cheap evista online. Generic casodex, Those customers (16.28% n=7/43) who move to a third party maintenance provider and give up future upgrade rights often face threats from sales people that they will have to "pay dearly" if they plan to come back  to the vendor.
    Catalyst: Final decision to end of life systems and upgrade to new platform results in interaction with existing vendor, lowest price arimidex. Ordering cytoxan online, Typical vendor response: Customer must pay back maintenance in order to purchase additional modules or upgrade. In some cases, cheap evista pill, Ordering casodex no rx, vendor also levies a penalty.

  4. Scenario 4: Customers not paying for maintenance with license contracts. Buy cheap evista online, More and more customers (11.63% n = 5/43) in newer areas such as CRM no longer pay for maintenance and support past the first year.  With replacements every 4 to 5 years for CRM, some customers achieve a better ROI by avoiding the 5 years of maintenance.  Why?  Five years of maintenance at 20% is equivalent to the cost of the original license.   Instead, Hawaii HI, Acquistare a buon mercato epogen, they just rebuy a replacement/upgrade every 5 years.
    Catalyst:  Replacement and full rebuy of new system, evista kopen. Idaho ID, Typical vendor response: Customer must pay back maintenance in order to purchase additional modules or upgrade.  In some cases, vendor also levies a penalty.


Figure 1, För capecitabine online. Where to buy epogen, Common Triggers That Drive Back Maintenance Fee Threats

screen-shot-2010-04-13-at-125226-pm


Customers Often Have More Leverage Than They Realize

Most organizations fear that vendors will carry out threats to charge back maintenance.   Those vendors who subsidize license fees with maintenance to maximize Total Account Value (TAV) often threaten customers the most.  Many organizations will cave-in to demands.  Do not cave-in!  In almost every scenario, expert contract negotiations often result in win-win propositions for both the customer and the vendor for a few reasons:


  • Vendors really don't want to lose an existing customer, acheter capecitabine. Despite the threats from vendors, customers who self support, move to third party maintenance (3PM), or opt out of support, find themselves with significant leverage.  Free of the vendor, organizations in this scenario can make a clean decision because the technology typically is outdated, the cost of upgrade is close to the cost of reimplementation, and the organization has entered a new buying cycle.  If a current vendor wants a customer to pay back maintenance on top of the new license fees, that vendor will find themselves at a price disadvantage with a newer alternative.  Most vendors would rather win your business than lose a customer over back maintenance fees.

  • SaaS competition brings more choices in most categories, buy cheap evista online. Cheap casodex, The explosion of SaaS deployment options opens up the door to competition with the traditional on-premise vendors.  In most cases, there are enough viable options to add  competitive pressures.  SaaS competitors can transcend existing platforms allowing for more choice in new markets.  Organizations should introduce SaaS vendors into short lists in decisions to replace or add additional functionality to existing systems.  Competition often results in the vendor backing down on their back maintenance fee threat.

  • Most customers have not bundled their service contracts. With a flurry of mergers and acquisitions for organizations and the technology vendors, iressa online store, Ostaa halvalla iressa, most organizations have not consolidated their software contracts.  Separate agreements give organizations significant leverage when dealing with vendors because organizations can choose which applications and solutions to cut maintenance on.  This power to slice and dice among the contracts provides tremendous negotiation advantage and a strong check and balance with vendors.  Do not bundle your maintenance contracts unless significant advantages exist in new terms and conditions.


The Bottom Line For Users - Software Market Remains A Competitive Buyers Market For Now

Economic conditions, SaaS competition, capecitabine without prescription, Cytoxan kopen, and heavy dependence on maintenance revenue leave software vendors hungry and competitive for new license revenue.  In markets with SaaS competition, customers continue to win concessions in license and maintenance fee reductions.  Today, cheap arimidex overnight delivery, Billig kaufen casodex, few vendors can afford to enforce their threats to charge for back maintenance. With a high likelihood that current conditions will continue, its would be unlikely to assume that vendors would give up the opportunity to win license revenue by charging for back maintenance.  Work with a contract negotiations expert with applications strategy experience for the best results.  Avoid contract negotiators who do not understand vendor product road maps or hide behind revenue recognition excuses.

Your POV

Has your vendor threatened back maintenance?  Should you have rights to Third Party Maintenance (3PM) ?  Do you feel its okay for your vendor to prevent you from access?  What's a fair amount to pay for maintenance?  Add your comments to the discussion or send on to rwang0 at gmail dot com or r at softwaresinsider dot org and we’ll keep your anonymity.

Please let us know if you need help with your contract negotiations and maintenance renegotiation.  Here’s how we can help:


  • Assistance with vendor threats of back maintenance

  • Crafting your next gen apps strategy

  • Contract negotiations support

  • Free market evaluation to identify contract cost savings


Related resources and links

Take the new and improved survey on 3rd party maintenance


20100222 Monday's Musings: Why Users Should Preserve Their Third Party Maintenance Rights

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

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.


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

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Order Zometa No Prescription

Published on January 18, 2010 by R "Ray" Wang


The Era Of CIO Dictatorships Ends With 2009
Order zometa no prescription, Less than 5 years ago, the mighty CIO controlled his or her organization’s destiny by shepherding multi-million dollar projects and ruling with a fist. Ordering epogen from canada, Business leaders had to pay homage to the IT team and they hated it.  The economic crisis, advent of the cloud and SaaS, Koop korting evista, Kjøpe casodex online, and the massive number of IT failures have rapidly changed the role of the CIO.  Saddled with the burden of maintaining legacy projects and faced with a shortage in budget and resources, businesses now move around the IT team as they must meet a flurry of business requirements.  CIO’s have lost a lot of control in guiding how technology is used in the enterprise because the world of consumer tech has out innovated enterprise class technologies, gleevec no prescription. Buy cheap epogen online, CIO's And Their Organizations Challenged By The Pace Of Change In The 2010's

Similar to this past decade, organizations will face massive amounts of change in the next decade.  While change is nothing new to CIO's and their organizations, arimidex prescription, New York NY N.Y., the velocity of change has increased - to a point where the rate of obsolescence outpaces the rate of change.  Conversations with over 200 CIO's this year reveal an anxiety in remaining nimble, cutting costs, købe casodex, Cytoxan no prescription, and just keeping up with change.  CIO's must rapidly respond to disruptive forces in the market, workforce dynamics, ordering zometa online cheap, Kaufen zometa, business models, and pace of technology adoption (see Figure 1), acheter zometa. Order iressa no prescription, Figure 1.  Four areas of change responsible for major disruptions in today's organizations

[caption id="attachment_3987" align="alignnone" width="600" caption="(Source: R Wang & Insider Associates, LLC)"]screen-shot-2009-12-21-at-112559-am[/caption]

The Bottom Line - The CIO Role Shifts To Match Next Gen Enterprise Requirements

What's the role of the CIO in this next gen enterprise?  Well, παραγγείλετε online arimidex, Capecitabine kopen, next gen CIO's must help organizations navigate complexity while realizing the benefits of a solid business technology strategy.   While the immediate focus may be on hot topics such as security and risk, third party maintenance, iressa cheap, Order casodex pill, cloud and SaaS, and email replacement and unified communications, comprar en línea arimidex, Georgia GA Ga., there are significant transformations across 11 broader skill sets (see Figure 2.)  Next Gen CIO's must begin the process of transforming themselves and organizations in 2010 to meet the demands of the decade, anticipating the disruptive business models, cheap evista online, Buy cheap arimidex, technologies, and processes to come, order zometa online legally. Cheap cytoxan online, Figure 2. Eleven Skill Shifts For The Next Gen CIO

[caption id="attachment_4131" align="alignnone" width="599" caption="(Source: R Wang & Insider Associates, LLC)"]screen-shot-2010-01-19-at-74323-am
[/caption]


In This Series


Your POV

What skill shifts are you seeing in your work as a CIO?  Do these shifts resonate, order zometa no prescription. Do you have a different point of view, buy iressa. Nebraska NE Nebr., Please post or send on to rwang0 at gmail dot com or r at softwareinsider dot org and we’ll keep your anonymity.

Copyright © 2010 R Wang and Insider Associates, LLC. 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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Personal Log: Altimeter Group – Helping Organizations Bridge The Technology Obsolescence Gap

Published on August 27, 2009 by R "Ray" Wang

Altimeter Group Logo

Emerging Technologies Alter The Approach To Enterprise Strategies... The proliferation of and access to emerging technologies by the business user challenges organizations to rethink their enterprise technology strategy.  Consumer technologies have proven to be not only more innovative and collaborative, but also quite accessible and equally reliable when compared to existing enterprise tools.  The result - IT departments no longer reign supreme in determining technology strategy and adoption.  In fact, business leaders and individuals increasingly play a greater, if not decisive, role in driving the selection and cultural adoption of technology.  Consequently, enterprise strategies must be crafted to manage disparate systems, technologies, and deployment options across the organization. ... But The Rate of Technology Obsolescence Outpaces The Pace Of Technology Adoption Organizations face massive levels of change across challenging macro-economic conditions, emerging workplace dynamics, new business models, and slow pace of technology adoption.  Unfortunately, they must respond to these changes while being saddled with the burdens of last century's technology.  Without actionable application strategies in the transition to social enterprise apps, many organizations face obsolescence.  How do we get from where we are today to where we want to be? Enterprise Strategies Must Begin With The End In Mind To take a Coveyism, its important to define the objectives before you begin.  As the enterprise strategist at Altimeter I'll be assisting our clients with:
  • Adopting technology strategies driven by business need;
  • Building dynamic user experiences;
  • Crafting strategies to transform business processes;
  • Delivering a connected community; and
  • Eliminating burdensome cost structures to fund innovation
These advisory projects will include but not be limited to:
  • Technology strategy reviews
  • Vendor selection
  • Independent verification and validation (IV&V)
  • Vendor management strategies
Succeed With A Holistic Approach Beyond Just Enterprise Strategy As I assist our clients with these enterprise strategies, its important to think of these in the context of a holistic approach (see Figure 1).  Your organization's overall strategy should also address the challenges and success strategies in leadership, customer, and innovation required for success.  I'll be joined by 3 other partners including our founding partner, Charlene Li, who will focus on the culture and structures required to guide these emerging technologies in the organization.  Deb Schultz, a pioneer in bringing innovation concepts to life, will be leading our labs program at "The Hangar". Meanwhile, my former Forrester colleague, Jeremiah Owyang will be focusing on customer strategy of emerging technologies.
Figure 1. Altimeter Group's Four Practice Areas
Join The Altimeter Open House Webinar On The Future of Business Find out more about how the Altimeter Group can serve as your resource at our upcoming Open House Webinar.  Details below: Date:                           Thursday, September 10th, 2009 Time:                          10 am Pacific Time (GMT - 8:00) Registration link:     https://www2.gotomeeting.com/register/725944010
Related blog posts:
Your POV What are your top concerns about your enterprise strategy?  Will you have the tools to get from today's enterprise technologies to an emerging world of Web 2.0 and Enterprise 2.0 business solutions.  Let us know what you think.  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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Tuesday’s Tip: How To Properly Align Team Incentives In Software Contract Negotiations

Published on August 4, 2009 by R "Ray" Wang
In the first step of the original seven simple steps to successfully negotiate software contracts, the key is to have the right team in place.  To refresh everyone's memory from the March 8th, 2004 post the details for Step 1 are:
Step 1: Ensure that the right team is in place
  • Inputs:  Organizational chart and agreement on key roles.
  • Action items: Determine the key roles needed to conduct the negotiation. Business teams include the COO, Division VP’s .  Technology leaders include the CIO, enterprise architecture . Vendor management teams include the procurement experts, legal team, etc.
  • Deliverables: Responsibilities list for each role.
Having the right team in place is important.  However, dozens of readers point out the dire need to not only align incentives but improve transparency.   Some examples include views such as:
  • CIO's. "While the CIO needs to set the technology direction, we often find two types of CIO's - the buyer and the implementer.  Buyer CIO's get wined and dined during the process, hob nob at events, get all the attention and perks, then leave for another company to do the same thing.  Implementer CIO's get stuck with making the stuff all work, cost overruns, and 100's of tradeoffs in promised capabilities and all the blame for failure." - VP of Business Applications, Fortune 100 Company.
  • Procurement/vendor management teams. "The only thing that our Procurement VP and her staff seem to care about is the discount % and total savings.  Despite our need for a product that costs the same, we see her team favor the products that show her the most savings.  Its no wonder why vendors keep jacking up prices to create win-wins for companies like ours where procurement teams have considerable influence." - CIO, EMEA based Financial Services Firm
  • Line of business execs. "Often the business side of the house fails to consider the indirect and hidden costs of ownership.  Some solutions are sexier but cost 3 to 5 times more to integrate, maintain, and staff up for.  These guys forget that we pick up the tab when it fails to work well with other systems" - Enterprise Architect,  North American Transportation Company
The bottom line - all incentives in the contract negotiations strategy must align with product adoption strategy Prior to any contract negotiations, the right team should also take the time to align incentives to the overall business drivers.  Form must follow function and how the solution will be used should be paramount.  Four key criteria:
  1. Define success criteria. Start by determining what success criteria will be utilized.  Some metrics include implementation times, return on investment, savings in total account value (TAV), etc.
  2. Create transparency in objectives. Team members should lay out their incentives and how performance in their management by objectives (MBO's) will be impacted by different scenarios.
  3. Realign incentives for maximum alignment.  Once the objectives have been determined, the team should come back with incentives that reflect performance in short, medium, and long term goals .
  4. Codify and communicate metrics.  Final metrics and incentives should be made public to all team members and performance objectively tracked by an independent committee.
Your POV. Got additional suggestions and best practices?  Ready for the big maintenance renewal seasons in Q4? If you need assistance with your SAP, Oracle, Infor, Lawson, Microsoft Dynamics, or other enterprise software contract, send me a private mail.  We can assist with a contract negotiations strategy that aligns with your apps adoption strategy.   Please post your comments here or send me a private email to rwang0 at gmail dot com or r at softwareinsider dot org. Copyright © 2009 R Wang. All rights reserved.

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

Published on March 24, 2009 by R "Ray" Wang
Maintenance costs represent a major part of the software budget and the largest growing source of revenue for software vendors.   In fact, an aggregation of the past four quarters of software vendor financial results definitively demonstrates double digit declines in new license revenue, even more exacerbated by the evils of currency flux from the strong dollar for US based vendors. Not surprisingly, vendors are hard at work vigorously protecting their 70 to 80% margin in maintenance revenues just as clients and readers of this blog now zero in on this line item as the major concession target during contract negotiations.  Here are five steps (i.e. as simple as ABC's) you need to do now*:
  1. Assemble all the relevant contract information. Aggregate all your contract information and vendor interaction history so that its centrally accessible.  Determine the value of your maintenance agreement. Examine how often you call for support, apply patches, conduct upgrades, and require technical assistance.  Then calculate the total support and maintenance spend.  Most customers will find that for $1M a year, 5 support calls can be pretty pricey at $200k a pop, especially when upgrades aren't in the picture for the next 24 months.   The vendor better show up the next day with white gloves and be there in person.
  2. Breakdown the total cost of shelfware. Simply put, shelfware is the software licenses purchased, not deployed that is incurring support and maintenance fees.  That great deal 3 years ago you got on 1000 user licenses, when you only ended up using 800, now comes to bite you in the butt.  Calculate the maintenance fee you have for 200 user licenses at $1000/user which is $200,000 X 20% annual support and maintenance X 3 years.  At $120,000, you had better make up the "big" discount you got for buying 1000 user licenses by at least 12% this year and 15% the next year.
  3. Craft your overall software adoption strategy. Consider the business drivers that impact software adoption.  Assemble the domain experts, vendor management and sourcing professionals, legal experts, business owners, and IT team.   Apply a long term apps/ recession proof apps strategy and determine when and how licenses will be used in the software ownership lifecycle.  What processes will be supported? What roles will use the software?  When will you upgrade?  Can you consider an alternative?
  4. Determine all the alternatives. Depending on your adoption strategy, multiple paths exist.  If there are no intentions to upgrade or enhance the software, self support and third party maintenance (3PM) options from vendors such as Rimini Street and Spinnaker should be considered.  In some cases, an upgrade should be completed before switching over to 3PM or self support.  If the system can be replaced, begin vendor selection efforts so that you will have leverage during the negotiation.  If the system cannot be replaced, consider swapping out unused licenses for credit towards newer or more desirable modules.  Reduce your CPI for new maintenance.  Focus on reducing new license costs.
  5. Follow-up with Engage your account representative at least one quarter before the contract expires. Put preparation on your side and begin to let your sales rep know 3 to 6 months in advance that you are unhappy with the current agreement.  Based on steps 1 to 4, you now have the ammunition you need to negotiate from a position of strength.
The bottom line - align your contract negotiations strategy with your product adoption strategy. Successful negotiations will require these 5 steps.  However, more importantly, organizations should keep a current apps strategy and product adoption strategy.  Without these two key documents, lack of visibility into the business case will lead to shortsighted negotiations that fail to meet the true requirements of the business.  Sourcing, procurement, and vendor management professionals should partner with domain experts who can provide third party, independent and objective advice that will complement contract negotiations strategy.  Click here for more contract negotiation strategy tips. Your POV What's your best practice in reducing maintenance costs?  Post your comments here or send me a private email to rwang0 at gmail dot com.  Do you need more advice on contract negotiations strategy?  If you are a Forrester client, call the inquiry team and they can set up some time.  In your request, specifically ask for R "Ray" Wang.

Contribute to the 2009 Enterprise Software Licensee's Bill of Rights

Take the new poll on what rights should be included in the 2009 Enterprise Software Licensee Bill of Rights   Posts are preferred!  For every good idea or comment, whether or not we use your idea, we'll send you a copy of the final report.  Let's put the collective wisdom of the web to work and help our end user clients create a fair win-win playing field with the vendors.  We'll be publishing the official update in Q2 2009.  Thanks and look forward to your input!
*Caveats are as follows:  1) This does not constitute legal advice.  Please consult your legal counsel for an official opinion and wording.  2) This does not consider any procurement or vendor management rules that must be applied to your enterprise.  Please work with your vendor management teams for compliance.  3)  Contract negotiation support provides insight into overall trends and price points.  Benchmarks are not provided as each user scenario is unique. Copyright © 2009 R Wang. All rights reserved.

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Tuesday’s Tip: Software Licensing and Pricing – When Software Contract Negotiations Strategies Should Be Led By Domain Experts

Published on March 10, 2009 by R "Ray" Wang
A common question asked by readers of this blog is when should vendor contract negotiations be led by a domain expert and when should this be led by a procurement professional?  As the complexity of the technology topology increases, expect a multitude of domain experts in roles such as application specialists, business process experts, enterprise architects, and information management professionals to take a greater lead in contract negotiation strategy and become more engaged in the vendor management process.  Let me share with you some best practices from the field. Here are a few rules that work in favor of the domain experts who have contract strategy expertise:
  • Where product strategy drives contract negotiation strategy. Sample questions. How should I negotiate my SAP contract with the introduction of Business Suite 7? How should I consider Oracle Fusion Applications as I upgrade from PeopleSoft? How should I structure my contract with my Microsoft Dynamics partner as I move from GP to AX? How do I negotiate my SAP BW contract along with my BOBJ purchases?
  • Where vendor knowledge drives contract negotiations strategy. Sample questions. How should I deal with Oracle in overall pricing and licensing strategy? How do I avoid a software audit with SAP? Is it typical for SAS institute to price by subscription licensing? How do I avoid an increase in maintenance fees with SAP?
  • Where previous experiences in contract strategy becomes valuable for existing customer contract strategy. Sample questions. In your experience with Oracle contract negotiations, what’s a typical database discount? What companies have been successful in moving to third party maintenance with PeopleSoft? How many SAP customers have won concessions on maintenance with SAP? Is there a way around the Infor third party maintenance lock-in?
Here are a few rules that favor of the vendor management and procurement generalists:
  • Where the domain experts lack contract negotiations strategy. Sample questions. How do I set up flex up/ flex down provisions with my vendor? How can I reduce my overall maintenance fee structure?
  • Where vendor management and procurement strategy touches issues about managing multiple vendors. Sample questions. What are good approaches to manage multiple vendors? Does it make sense to consolidate vendors? When do I deem a vendor a strategic vendor? Should I apply tiering to vendors?
  • Where contract negotiations and procurement strategy touches about internal processes. Sample questions. Who should engage with vendors? What's the contract negotiations strategy? How do you handle different procurement processes within the company?
The bottom line - good negotiations strategy requires domain expertise Contract negotiations devoid of apps strategy or understanding of the vendor's product strategy often lead to shortsighted negotiations that fail to meet the true requirements of the business.   Success requires strong alignment of product strategy adoption with business strategy and vendor management strategy. Your POV Does this resonate with you and your procurement process?  Do you have a best practice in delineating roles in contract negotiations?  Post your comments here or send me a private email to rwang0 at gmail dot com.

Contribute to the 2009 Enterprise Software Licensee's Bill of Rights

Take the new poll on what rights should be included in the 2009 Enterprise Software Licensee Bill of Rights   Posts are preferred!  For every good idea or comment, whether or not we use your idea, we'll send you a copy of the final report.  Let's put the collective wisdom of the web to work and help our end user clients create a fair win-win playing field with the vendors.  We'll be publishing the official update in Q2 2009.  Thanks and look forward to your input!
Copyright © 2009 R Wang. All rights reserved.

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Poll/Survey: It’s Time To Update The Enterprise Software Licensee Bill of Rights!

Published on March 5, 2009 by R "Ray" Wang
Now's The Time To Assert Your Rights With the market now in favor of the enterprise software licensee, its now time to update the Enterprise Software Licensee's Bill of Rights to include newer topics such as virtualization, SaaS and subscription pricing, newer usage based pricing models, open source, and vendor lock-in avoidance.  As mentioned in a call to action in a December 2008 Monday's Musings, this groundbreaking report, originally published in December 2006, will be updated to reflect current market conditions.  The goal - improve this reusable contract negotiation model that cuts across the 5 key phases of the software ownership life cycle:
  1. Selection
  2. Implementation
  3. Utilization
  4. Maintenance
  5. Retirement
An Enterprise Software Licensee's Bill Of Rights Gives Users A Platform to Build a Win-Win Client Vendor Relationship
[caption id="attachment_1195" align="aligncenter" width="600" caption="December 2006 Enterprise Software Licensee's Bill of Rights"]eslbor[/caption]
Your POV So based on some key market changes, here's my challenge to you.
  1. What rights should be added?
  2. What rights should be updated?
  3. What rights should be retired?
Take the new poll on what rights should be included in the 2009 Enterprise Software Licensee Bill of Rights or send me a private email to rwang0 at gmail dot com.  Posts are preferred!  For every good idea or comment, whether or not we use your idea, we'll send you a copy of the final report.  Let's put the collective wisdom of the web to work and help our end user clients create a fair win-win playing field with the vendors.  We'll be publishing the official update in Q2 2009.  Thanks and look forward to your input! Copyright © 2009 R Wang. All rights reserved.

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