Vendor Software Agreements

After having completed the extensive process of defining the functionality that must be present at “go-live” and the functionality that must be developed by pre-determined dates, it’s time to evidence this information in the various Information System Agreements. We recommend that the organization present a draft of the proposed Agreements to the vendor, rather than having the vendor submit its Agreements to the organization. This approach should come as no surprise to the “vendor of choice” because all vendors were informed, during Step 3 of the process, that this would occur.

Typically, the vendor wants to assume the leadership role by proactively presenting a pricing offer with their standard Agreements. This leaves the organization in a “reaction” mode by continually responding to the vendor’s terms and conditions. This is not the approach that your organization should take. To the contrary – your organization should inform the vendor that it has an Information System Agreement Template Set that will be used as the basis for the proposed relationship.

We believe the organization should include contract provisions that not only protect its business interests, but also contain language that clearly defines issues such as software functionality on the “go-live” date, functionality that will be developed within certain pre-determined time-frames, contingent source code provisions, etc., -- including all associated fees. In other words, the Set of Agreements should clearly define those provisions that are important to the organization and the vendor, leaving no ambiguity as to what is expected from each party. The organization is in the best position to present those terms and conditions that define expectations, performance, and appropriate protections for both parties.

To that end, the Solutions Solves ™ Practice Management Methodology includes an Information System Agreement Template Set. Based upon years of experience in the development and negotiation of vendor agreements and of being a vendor, Solutions knows those provisions that should be included in every Agreement. We have created a Template Set that includes three separate Agreements with the critical provisions and appropriate language that creates a trusting, mutually beneficial, long-term relationship with the vendor. This Template Set is time-tested and proven, having been used hundreds of times the past thirty years.

Obviously, since each organization has different needs, the Agreement language needs to be modified so the particular needs are properly addressed. Solutions assists with this process. The Information System Agreement Template Set contains the following essential Agreements:

  1. License
  2. Software Services
  3. Operations Support

With minor variations, these Agreements can be used in different application software situations. For example, the language can be altered to accommodate a situation where the organization is licensing standard software, or software that requires some additional development by the vendor, or where the Group Practice is “co-designing” software with the vendor.

For more information on creating and negotiating these agreements, contact Solutions at 715-842-1684. We will be happy to assist and coach you through this process.