Software implementation services agreement

Technology constantly changes. Firms are periodically put to the choice about whether to upgrade their technology or build a new platform. An expert software vendor/installer can greatly assist firms in making and implementing these decisions, increasing productivity and efficiency, and thereby helping a firm grow its business. Vendors are often selected after a thorough evaluation process involving the submission of requests for proposals and the evaluation of multiple proposals, culminating in the negotiation and execution of a complicated services agreement and associated statement of work. Once the agreement is executed and the firm’s IT department takes over, however, the details of the agreement and SOW can be overlooked, creating litigation risk in the event a dispute develops between the vendor and the firm.

There are numerous reasons such a relationship can become contentious. The technology and the parties’ contractual framework is oftentimes complicated. Disputes can arise out of implementation delays, product defects, service inadequacies, disputes over payments, personnel changes, shifts in technology, and even personality conflicts. A one-sided agreement can force a customer to absorb long delays, continue the use of a dissatisfactory or otherwise outdated platform, or pay exorbitant fees to terminate the services agreement. As a result, understanding and adhering to the terms of these complicated contracts in the event of a dispute is oftentimes critical.

To assist customers in minimizing litigation risk after a services agreement is executed, below is a checklist identifying the typical yet critical provisions in a services agreement. Careful attention to these provisions will greatly assist companies in identifying issues and minimizing litigation risk after a service agreement is signed.

1. Payment Schedule: The payment schedule will dictate whether and how much payment is owed.