Edward J. Hansen brings more than 20 years of experience representing clients in technology transactions that involve significant business change. If you’ve attended a SIG Summit, then you are likely familiar with Ed and his work. In addition to being an active speaker at industry conferences, he has authored and presents the “terms and conditions” module of the SIG University certification program, regularly conducts contracting master classes (including for SIG’s Executive Immersion Program), serves on the advisory board of the Shared Services and Outsourcing Network, and is a regular guest lecturer at New York University’s Executive Master of Business Administration program.
You have a lot of experience representing clients in technology transactions. What are some examples of how technology has changed or impacted the way you approach your job?
The technology in place at any given time actually has little impact on how I approach my job. What does impact my job is the fact that the technology landscape when the deal is two years old may not be the same as it was when we went out to RFx.
I started working in the technology space in 1993 and spent almost a decade working with companies who were undertaking reengineering efforts. What I learned, mostly through trial and error, is that the process you go through in procuring and contracting for transformational technology is at least as important as the contract that emerges. Because of the velocity of change, the relationship you form during the process is often what carries the deal, and the contract has to reflect that.
Contracting is one of the most important parts of the sourcing process – this is one of the final steps in the process before (or in parallel with) implementation and it documents all terms and conditions agreed to by both parties throughout the sourcing engagement. While it is one of the most important steps in a sourcing engagement, it can also be one of the most painful with numerous rounds of revisions and reviewing legalese that can extend out a project timeline substantially at times. As a Sourcing professional, I’ve reviewed my share of contracts ranging from one page agreements to lengthy contracts with multiple attachments and exhibits. Each contracting experience is different, some have gone smoothly and are wrapped up in a few days’ time, while others took months to come to agreement on the final language. I will highlight a few recent experiences with contracting and some of the lessons learned that can be applied to others in similar situations.
Don’t skip the contract just because of a low spend figure.
On a recent project, my team was brought in to negotiate with a local hardware store that was used regularly for as needed supplies at a local manufacturing plant. Upon further investigation, we learned that the client had already negotiated a discount structure with this supplier earlier in the year, but there was no formal documentation because the annual spend with the supplier was below the threshold when contracts are required.
With global sports industry revenues over $145Bn and growing at a rate of 3.7% over the past 4 years, it is evident now more than ever, that behind the tackles and buzzer beaters, sports remains a business. Negotiations in business are usually governed by several tangible measurable data points that are indicative of future performance. Given below are a few aspects that are unique to negotiations in the sports industry: