{"id":2927,"date":"2010-07-14T13:22:00","date_gmt":"2010-07-14T13:22:00","guid":{"rendered":"https:\/\/www.certitrek.com\/nlpa\/2010\/07\/14\/whitepaper-wednesday-end-of-contract-strategies\/"},"modified":"2021-07-27T09:22:46","modified_gmt":"2021-07-27T13:22:46","slug":"whitepaper-wednesday-end-of-contract-strategies","status":"publish","type":"post","link":"https:\/\/www.certitrek.com\/nlpa\/blog\/whitepaper-wednesday-end-of-contract-strategies\/","title":{"rendered":"Whitepaper Wednesday – End-of-Contract Strategies"},"content":{"rendered":"

Welcome back to another installment of Whitepaper Wednesday here on the Purchasing Certification Blog. Today, I\u2019ll be reviewing a whitepaper entitled \u201cBe Prepared: Five Steps to Optimizing an End-of-Contract Negotiation Strategy\u201d from Compass and CFO.com.<\/p>\n

The first paragraphs of this whitepaper set the stage for why it is important to have an end-of-contract strategy when preparing to either extend or replace a relationship with an outsourcing service provider. Specifically, it says that sourcing teams are commonly \u201cunderprepared and overly confident\u201d in thinking that negotiation<\/a> will be easy because \u201cconventional wisdom states that\u2026[incumbent] service providers\u2026are eager to retain customers.\u201d In reality, the whitepaper contends that service providers know that switching providers is \u201cis a costly, risky, and time-consuming proposition\u2026and use this knowledge to their advantage in the negotiation process.\u201d<\/p>\n

The whitepaper offers \u201cfive key steps\u201d for a sourcing team to maximize its leverage as contract expiration approaches. While I found all five of these key steps to be valuable, I thought that the following two were the most important and would probably resonate most with readers of this blog:<\/p>\n

3. Get Senior Level Support<\/strong> \u2013 This point discusses the very real possibility of the incumbent service provider obtaining a contract renewal \u2013 at less favorable terms to the client organization \u2013 by backdoor selling<\/a> to the executive level if the sourcing team lacks senior-level support.<\/p>\n

4. Be Serious \u2013<\/strong> This point essentially states that incumbents seek evidence that the client is willing to pursue an alternative. Without such evidence in the form of things like an information-packed Request For Proposal<\/a> and active lobbying of potential bidders, the incumbent may be inclined to call the sourcing team\u2019s bluff.<\/p>\n

Sometimes, Whitepaper Wednesdays can be a bit onerous for me. Not this time.<\/p>\n

I found the topic of this whitepaper to be very thought-provoking and its solutions very practical. If you\u2019d like to check it out for yourself, you can download your own copy from CFO.com (registration required).<\/p>\n

Become a member<\/a><\/span>\u00a0of one of the world\u2019s largest procurement associations today.<\/span><\/p>\n

Recommended Reading<\/b><\/span><\/p>\n