From selection to signature: 7 tips for contract negotiation

This phase defines not only what the vendor will deliver, but how they will deliver it, what it will cost, and how success will be measured. It sets the tone for the system implementation and the long-term relationship. Getting it wrong can lead to spiralling change requests, misaligned expectations, and costly rework; while getting it right will mean a smoother delivery, better outcomes, and long-term value.

Here are our 7 top tips to help you ensure a successful contract negotiation:

• 1. Define a clear scope based on requirements
• The foundation of a strong contract is a shared understanding of scope, which is based on detailed business and technical requirements. Vague or high-level scope definitions are often the root cause of disputes later. Taking the time now to walk through the detailed functionality, integrations, data needs, and user stories ensures everyone is aligned before pen hits paper.
• 2. Push for fixed price deliverables
• While Time and Materials (T&M) can provide flexibility, a well-defined scope allows clients to push for fixed-price deliverables, offering greater budget certainty and reducing commercial risk. However, fixed price only works if the deliverables are tightly scoped, so upfront diligence is critical.
• 3. Understand pricing model and inclusions
• Vendors often present pricing in bundled formats. It's essential to unpack this, understanding what is included (e.g., configuration, testing, training) and what is not (e.g., custom development, post-go-live support). Ambiguities here can quickly become change requests later.
• 4. Match hosting and service levels to your business needs
• If the platform is cloud-hosted, you'll need to dig into the assumptions behind sizing, resilience, availability, and SLAs. Are the load projections accurate? Are backup, failover, and recovery plans sufficient? Does the SLA reflect your operational criticality? These are not just technical details, they are business continuity fundamentals.
• 5. Clarify ongoing service model and configuration management
• Ensure you understand how configuration changes will be managed post go-live. Will your internal team have the skills and access to make changes, or will the vendor remain involved? If you want more autonomy, that needs to be planned and priced upfront, with knowledge transfer, training, and documentation included in the scope.
• 6. Know the difference between customisation and configuration
• Many modern platforms support high levels of client-controlled configuration, reducing the need for bespoke code. But where true customisation is required, it should be clearly logged, justified, and costed. These often have long-term support implications that are not always obvious during the sales phase.
• 7. Invest time now to save cost and risk later
• It's tempting to accelerate contract signing to maintain momentum, but rushing this stage often leads to downstream delays, change disputes, and even project failure. A well-structured negotiation phase will reduce future friction and establish a stronger foundation for the implementation and service phases.
• While there is certainly art to contract negotiation, these points illustrate that much effort is needed too. Like in most walks of life, planning to succeed makes success far more likely.