greater efficiencies, including decreasing vendor negotiation time to just three to five business
days and one to three short follow-up conference calls. This halves\ the number of contract
management personnel required to manage the mobility sourcing contracts.
A Fair Contract, Fast
HP ENTERPRISE SERVICES, ASIA–PACIFIC AND JAPAN
For the past three decades, the IT legal industry has pursued the same contracting
methodology, characterized by extended wrangling driven by the desire to “win” every
clause. Although protracted negotiations on terms rarely reduce risk or increase competitive
advantage, the process and the mindset behind it were entrenched.
“We kept doing the same dance to get to the same middle position,” says Paul Lanzone, Vice
President and Associate General Counsel, Asia–Pacific and Japan, for HP Enterprise Services.
“We felt like it was time to get there faster.”
Recognizing that deals require a partnership and that the old way misaligned the interests
of HPE and its customers, Lanzone and his team turned their focus to contract terms that
really distinguish their offering: services and price. Other changes were happening in the IT
contracting world simultaneously: monolithic master services agreements of yore no longer
suit the high-utility, open, flexible solutions of today.
The HPE legal team decided to change the way it worked. Lanzone had had a previous
experience that convinced him it was possible:
“I had worked through a deal in the UK worth A$1.4 billion that took over seven months
to complete,” he says. “But an additional contracting mechanism developed over a weekend
pitching for an additional A$800,000, using a modular approach showed me that IT
contracting can be done quickly and flexibly.”
But Lanzone wanted something more than speed and flexibility: fairness.
“We had to be fairer. We had to give up our supplier-centric positions and convince our
customers to do the same. This was a big change in methodology, from our previous old-school lawyering.
In 2013-2014, the legal team marshalled resources, pulling its existing global templates apart
and putting them back together with a different lens. The new methodology features a seven-step process that places a significant focus on face-to-face meetings. It flips standard contract
negotiation procedure on its head by obliging each party to tackle the hard legal issues early,
and facilitates the quick finding of middle ground.