3 Tips on Using Software Renewal Negotiations to Plan Your Cloud Migration

When your business commits to migrating its IT infrastructure to cloud or hybrid alternatives, this monumental decision is just the start of a much longer, methodical process. Unfortunately, the process can be costly if you don’t approach migration with the strategic aim of controlling costs to make your new cloud-based investments more affordable and valuable to your organization.

The decision to migrate to cloud-based alternatives may also dovetail with contract renewals and negotiations with your existing legacy software vendors. Rather than force an abrupt migration and suffer the disruption and cost that comes with poorly planned infrastructure projects, your business should leverage vendor negotiations to build a more accommodating launching pad for your migration project.

Even as you renew or extend your contract, certain pricing compromises and other negotiated terms can facilitate a smoother and more cost-effective transition for your data center management services. Here are some tips to keep in mind as you map out your exit strategy amid vendor negotiations.

Tip 1. Trim Unnecessary Services and Expenses

Every vendor’s approach to bundling and pricing is different. But regardless of how your pricing is currently structured, your business should identify services and related expenses that can be trimmed or offset by more cost-effective investments into cloud-based alternatives.

Pinpointing and prioritizing these service cuts will require collaboration with software architects that understand both the service packages you’re currently paying for, the complexity of untangling certain services and capabilities from your legacy framework, and the potential cost savings of these changes relative to the value they create. Through strategic scaling down of existing data center management costs, you can grow your own budgetary space to afford incremental steps toward full cloud migration.

Tip 2. Use Market Comps to Scale Back Costs

Market comps are crucial regardless of whether you’re planning to migrate away from your existing third-party service management partner. But even if your business has one foot out the door and is determined to migrate to the cloud sooner or later, market comps can still be valuable leverage as you work to control legacy costs and afford your complex move to the cloud.

Of course, it’s possible that even with concessions on price, your business may still ultimately plan to migrate over to cloud-based alternatives—including the same service packages your current vendor is attempting to match on price. But even minor revisions to contracts and pricing can free up budget space that can fund your next steps in migration.

Although your technology procurement leaders may be reluctant to play hardball in negotiations with a vendor whose partnership with your business has an expiration date, market comps and tough back-and-forth negotiations serve multiple goals of successful cloud migration.

While these negotiations can help lower costs and reduce the expense your business faces through this significant infrastructure project, they can also help untangle some of the legacy services supporting your data center, making your later separation a little less complex and cumbersome.

Tip 3. Prioritize Migrations That Offer the Greatest Savings

With a cost analysis of your service bundle at your disposal, take time to review potential services and capabilities to determine where the greatest cost savings can be found.

Again, software architects must be involved in any process that determines which service migrations offer the greatest savings and value. Depending on the structure of both your service contract and your IT architecture, migrations that offer the best value might not be feasible: in spite of the theoretical savings they offer, they may be too integral to your existing infrastructure to replace at an early stage in migration.

If you want to lead a successful, cost-effective data center migration project, you need a plan—and you need collaboration between a wide range of stakeholders, including software architects, procurement officers, finance executives, and your entire IT department. You can start laying the groundwork for a successful transition by coordinating your strategy and planning ahead even as you negotiate your next software contract.

Eager for some expert insight to guide these negotiations and strengthen your strategy? Origina’s data center migration experts have seen it all—and they’re ready to help you manage costs and complexity to deliver the best outcome possible. Contact us today to schedule a consultation and find out how we can help.


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