Be Prepared: Five Steps To Optimizing An End-Of-Contract Strategy

Sponsored By Compass Management Consulting

Topics:

Finance & Risk Management > Benchmarking/Metrics , Outsourcing

Technology > IT Management

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Abstract:

The end of an outsourcing contract term should be an ideal time for client organizations to negotiate improvements in rates and services. Service providers, the thinking goes, are eager to retain customers and will offer price concessions and address quality issues.

As a result, many clients go into a renegotiation overestimating the leverage they have. In reality, replacing an incumbent is a costly, risky, and time-consuming proposition. Indeed, only a small percentage of clients risk a full-scale change of vendors. Vendors recognize this, and use this knowledge to their advantage in the negotiation process. While leverage does not automatically appear with the end of the contract term, clients can take steps to identify priorities and enact real change.

This white paper examines the issues surrounding sourcing negotiations at the end of the contract term and outlines five strategies to optimize benefits and drive improvement from the renegotiation process.

DETAILS

Sponsored by: Compass Management Consulting

Released: November 19, 2009

Length: 5 pages

Format: PDF (435 kb)

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