Renegotiating Outsourcing Contracts: What Works and Why

As outsourcing decision-makers gird for another year of engaging with IT and BPO suppliers, it is a good time to reflect on what has worked well over the past twelve months and what could be improved. This is as true for outsourcing contracts as it is for everything else in our lives.

The transition from one year to the next is a good time for companies to ask themselves whether their outsourcing relationships remain fit for purpose and whether they are getting the best value for money from their suppliers. If the answers to these questions are negative, then perhaps it is time to renegotiate the contract.

This article considers the reasons parties renegotiate, and best practices for preparing for and conducting a renegotiation.

Reasons to renegotiate

Parties will usually renegotiate coming up to contract expiry. However, there are various reasons why a customer might want to renegotiate mid-term as well. These include:

  • Dissatisfaction with the service provided
  • Technology issues
  • Poor relationship management
  • Financial reasons
  • Business change

Read more at: Renegotiating Outsourcing Contracts By Caroline Doherty de Novoa

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