Why benchmark and negotiate software agreements?
A benchmark and subsequent negotiation assistance for software agreements guarantee knowledge of the prices that an organisation can actually achieve, while preparing for a rigorous, structured negotiation process in what is one of the most complex negotiation disciplines in the IT sector.
When should you benchmark and negotiate your software agreement?
You should consider a benchmark and software negotiation whenever you are renewing an agreement and when looking into an extension, or if there are any changes to the infrastructure that affect your software portfolio. It is also a worthwhile practice to consider, if you are about to purchase major new services from the software vendor in question, or in situations, in which the vendor introduces various non-compliance requirements in the context of audits. In this context, a structured review of the portfolio, pricing and subsequent preparation for negotiations can often mitigate the requirements received.
When it comes to benchmarking, the negotiation and conclusion of software agreements, the optimisation of software portfolios and the establishment of long-term software strategies, Zangenberg Group is the number one advisor in Denmark. We specialise in SAP, Microsoft, Oracle, IBM, Software AG etc. and have assisted both public and private sector clients – including a large number of C20 companies – with their benchmarking and preparation for software negotiations. Those companies have achieved significant savings and favourable terms and conditions in their agreements.
The benchmarking process starts with a baseline data collection and a normalisation of the products vis-à-vis scope and comparable peers. Once we have mapped the baseline and presented scenarios that might be of interest to the organisation, we calculate the financial target zone for each of the scenarios.
The negotiation process depends on thorough preparation and rigorously equipping the negotiation team prior to discussions with the vendor. The work involves an analysis of existing software and of the organisation’s use of that software, and analyses of new products and functionality, identification of alternatives to the existing solution and clarification of the organisation’s future roadmap and requirements.
- Mapping of software portfolio and usage
- Benchmark against comparable peers
- Input and recommendations for terms conditions
- Preparation for negotiations and negotiating strategy