Third-Party Software Support: Pros and Cons

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You should consider the risks in switching to a third-party support structure, as well as benefits that can be achieved in well-defined circumstances.

4. How can I minimize the risk of using third-party support?

The short answer is … contractual details, details, details! More specifically, make sure that your service contract clearly:

·  Defines who is responsible for doing what, when and at what cost. For example, do costs increase if the problem escalates? Are you expected to provide the service vendor with office support on-site? And what about technical bugs the vendor can’t fix?

·   Stipulates when and how fees are assessed. Nobody likes cost surprises or litigation, so make sure the contract defines hardware and software resources, what actions will result in what charges, and how the payment process works.

·   Prioritizes and states precisely what should happen in the event of predictable events, such as common technical bugs. Is the bug a vital situation, fairly significant or just routine? Based on the bug and the priority level, how is the service vendor expected to respond?

·   Names exactly who the primary support contact will be at the service vendor, and ideally stipulates that this person is to coordinate all service events and act as the sole, or primary, liaison with your organization.

The Bottom Line

The cost of software maintenance is an unavoidable cost of doing business today. Third-party service vendors cannot fully replace a software vendor’s SULS because they have no legal rights to the source code—a situation recently upheld in the courts at great cost to third-party service customers.

There are circumstances in which replacing software vendor SULS with third-party service contracts makes sense and can reduce an organization’s software maintenance costs significantly, but be sure to negotiate a contract that clearly defines responsibilities, fees, priorities, predictable situations and actions, as well as a primary liaison. There are also situations in which third-party support can save time and money as an augmentation to your software vendor SULS. 

Most importantly, the best time to minimize a software vendor's SULS fees is during the negotiation of new or revised licensing agreements. If you carefully select the optimal software packages for your enterprise and negotiate overall costs with professional savvy from the outset, your maintenance costs should not exceed the value of smoothly running, fully compliant and up-to-date software.

Scott Rosenberg is CEO and founder of Miro Consulting, in Woodbridge, N.J., which helps companies analyze and negotiate enterprise software contracts, specifically Microsoft and Oracle licensing. He is also an active member of the International Association of IT Asset Managers and is a certified software asset manager.

This article was originally published on 2013-05-02
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