The Bare Truths About Vendor Management and Contract
Look at how things are different. There was a time when the purpose of having a contract between vendor and a vendee was simply to establish the terms of their relationship and the manner by which prospective business relationship is to be conducted. As soon as the terms of the contract are spelled out which are simple, concise and straightforward, you are ready to affix your signature and set the deal. That is basically contract management in simplest terms.
However, if you are talking of software license agreements, things will be quite different from your conventional contracts and the application of the principles related to vendor management will have a varied outward appearance. If you are availing of one of these software packages which are governed by license agreements then it is essential that you spend a moment to study the fine prints of the legal obligations as it is important that you understand every detail of its provision. This is how the principles of contract management are applied under agreements involving the purchase of software packages.
An effective contract management involving software packages will require you to focus on the prices and other legal provisions that are part of the package. The cost is often quoted in the legal disclaimers about system performance and quality. This portion of the document is an essential component and it is important that you analyze if you are satisfied would this kind of relationship as what is indicated is what you will receive and nothing more. In your approach for relevant principles and techniques of vendor management, it is important that you are aware of what the vendor commits to provide you and the legal remedies available to you in case you do not see eye to eye.
It is imperative that you cover all the bases including those outside the contract price and major legal issues. If you feel that the contract presented by a vendor seems to be disadvantageous or deficient in substance in protecting your interest, the problem is not in the contract. There are some things that you may have overlooked during the negotiation that preceded the contract. Most of us have the tendency of focusing our attention on the more prominent facts of the transaction and leave everything to the lawyer. In the end, we find ourselves with a contract which does not meet our expectation. In many instances, what we have as a contract is deficient or lacking in provisions on compliance to schedule, performance of the vendor and cost control.
So, what are the important things that you must cover in a negotiation? Obviously, you will need to concur on the contract price of the software package. Over and beyond the price consideration and other related issues, you have to focus extensively on the functionality and support services that you want the vendor to provide under the proposed agreement. You should remember that what is being sold is a group of thoughts and not a tangible and physical product. Its importance is determined by product’s ability in providing the functionality that you need within a certain period of time and with the level of quality that you can not achieve using your existing manpower and capabilities.
