How to Save a Lot of Coin, Easily, When Buying Software

Software Licensing Handbook – A Million Dollars Worth of Value

                                                     Book Review

Jeffrey Gordon has published the Software Licensing Handbook that is sure to save software buyers lots of money and cost vendors a lot more. It could also impact my colleague Vinnie’s Deal Architect practice, too, if a lot of folks read this.

What Jeff has done is dismantle a standard software contract. He has dissected its component parts into easy to understand sections that explain what a vendor wants, what a customer should ask for and what each party should be willing to agree to if they want to reach a fair decision.

I would call this book: King Solomon’s Guide to Splitting the Software Contract Baby. Vendors are surely going to hate this publication and that should mean it is must-read material for software buyers. I’d strongly recommend that selection team members, not just the in-house counsel, read this as it lays the groundwork for negotiations.

I’d also echo a suggestion in the book where buyers are encouraged to negotiate the terms and conditions first before haggling over the contract price as vendors show much less flexibility after the price (and hence, the decision of which vendor to go with) has already been determined.

While Jeff’s book is not meant to replace legal counsel, the fact that he laid it out in the sequence and headings of standard software contracts makes it easier for buyers and sellers of software to involve counsel and buyers simultaneously in contract negotiations. This is actually quite useful as too many software buyers evaluate product capabilities separately from price negotiations which are negotiated separately from terms and conditions. When deals are negotiated in pieces, the right hand often agrees to a deal the left hand would have never accepted. This structure helps eliminate this outcome.

The book is approximately 200 pages in length. It’s well written, complete and current. As someone who has negotiated deals recently, I could only think of a few areas where I would have added more depth.

I highly recommend this publication. The price will not break the project team’s budget and the value payoff vs. book cost ratio is excellent.