IT Procurement Best Practices to Reduce Risk in Cloud Contracts
Nine terms managers should examine when negotiating cloud contracts.
"Clowns to the left of me, jokers to the right, here I am - stuck in the middle with you." - Stealers Wheels.
Listening to the CIO session at Gartner's annual Symposium, Larry Dignan of ZDNet wrote, was like being at a conference of bad marriages. IT buyers want out - some even have SaaS "mistresses" on the side. "But in the end these customers stick around and complain like someone that has been married three years and one upgrade cycle too long," he observed. "For these enterprises, a move to the cloud is a way - if not THE ONLY way - to ditch the legacy applications that feel like shackles."
Sticking with that awful bad marriage/mistress metaphor, he talked about a presentation by SaaS ERP NetSuite, which offers fast implementations. "In other words, NetSuite can be the mistress you ultimately decide to marry after ditching SAP or Oracle."
But, too often, those who leave a "bad" marriage for a marriage with a mistress find they've brought the same problems from the first marriage to the second.
"Force.com is available to SaaS customers of Salesforce.com for developers to build other systems [and applications]," Burton Group Research (now owned by Gartner) analyst Anne Thomas-Manes told SearchCIO.com "It's a great service for users to share apps, but it is a proprietary system, so there is a trade-off in that you are locked down."
And then there's the old adage about cheaters always cheating. The same article includes the cautionary tale of a CIO who received bills from 25 different people for 25 different accounts with cloud service providers. "Is finance aware of this, or will it be in for a sticker shock?" the article's writer wonders - a reminder that it's perhaps too easy to get into bed with the cloud, but not so simple to pay the costs.
It makes me wonder: Is the cloud really a way out of your vendor problems? Or are CIOs really just stuck in the middle between jokers and clowns who are more concerned with locking you in than keeping you engaged with great service and business value?
So a word to the wise: If you're going to upgrade your tryst with the cloud, get a pre-nuptial agreement that addresses many of the issues that bothered you in your past. The Burton Group specifically recommends you push for an open API and fair licensing schemes to address some of these challenges.
Otherwise, after the heady seduction, you may sober up to find you're still stuck with performance problems, proprietary platforms and, yes, vendor lock-in until death do you part.