1. Ensure you are not under an obligation to renew

You have relatively few options if you are obliged to renew. Typical contracts ask for 30 or 90 days notice prior to the end of the contract term. If you are within time, send a letter reserving your right to cancel and explain to your supplier that you have to make tough decisions at the moment and do not know where you will be in three months time finance-wise.

2. Do you have any money to spend?

There is no point in going any further if cancellation is the only option. You will have to go back to the start and look at free alternatives that permit commercial use, cancellations of something else or, failing all of the above, communicating a withdrawal of a service. Finding out the budgetary constraints will involve liaison with the Head of Department (if that is not you) and possibly the Finance Director, about the options you are exploring. Your message will be quite clear, you are planning to minimise expenditure whilst retaining essential services. Be careful not to over-promise, as disappointed Finance Directors are not good allies.

3. Cross off the ‘impossibles’

In option two there is no point in subscribing to the software mentioned if it involves IT time that cannot be given, or if it conflicts with your current IT systems. It also saves you going through all the points below, only to find this out later. Never ever anger IT. From experience, the earlier IT knows something is going on, the better.

4. Trials

A trial should identify how significant that 10% difference in content is to your particular organisation and to the searches and alerts you are most likely to perform.

5. Write up the trial results and get them agreed

They will be invaluable in later negotiations with suppliers, the users and the finance director. You might be able to summarise the results into bare tables of ‘number of relevant results’, but juicy details such as a news article notifying of a merger, or potential scandal that have key client relationship issues or business development opportunities are also worth recording. Include in the results information on any new opportunities not available in your current service, for example putting a link from a client relationship management system (CRM) to recent news about a particular client. Get whoever was involved in the trial to agree to the trial summary. That way they are less likely to be a malcontent in the future if things do not quite turn out as envisaged.

6. Are the differences in content and function future-proofed?

Part of the negotiation is not just about the present. You are investing a lot of time and do not want to go through this again in the near future. If the key differences were only minor and, in particular, related to key titles, check with the provider how long they have the contract to supply that content. This is not so important with providers who own their own content, but is vital with aggregators. Think how you would feel if a product you are paying for became a free one a month after you signed the contract. It has happened, so also consider a material change of business clause.

7. Are the financial differences future-proofed?

If you do make a major switch, you may get a good price this year, but what about next year? In the current climate you are often stuck between the finance director being unwilling to allow multi-year deals, but not wanting any nasty surprises round the corner. You can get around this with agreed price caps for a range of years, typically three to five years, but with no obligation to renew. These types of price-caps are easier to get in a tough economic climate than they are in boom times.

8. Do the terms allow you the flexibility you seek?

You may have identified that scenario two offers the technological ability to put links from a CRM system to news results, but do the terms of the contract match? This is where you can derive huge additional value by negotiating the terms that work for your organisation.

9. Summarise the pros and cons of all three scenarios and come to a preferred option

This may involve asking a few key people, for example in marketing, about how important to them would links be from a CRM system to news, were it ever possible? Is the service business critical? Think about the implications of no news service, option three, so that when you come to make a recommendation you are prepared. For the purposes of our scenario, option two came out as the same price as option one, but with a price cap and more ways to deliver the content. Option two has therefore become our preferred option.

10. Shuttle between the suppliers if necessary

You should delay telling your preferred supplier and your unsuccessful supplier until internal negotiations are completed. Language such as ‘we are leaning towards the service that gives us greater flexibility’ and ‘unless your prices come down dramatically I am afraid you are putting yourself out of the frame’, can have dramatic results, taking me back to Step 8 due to such a change in price and terms at a very late stage. In our scenario two we need two suppliers to achieve our single service, one without the other is not going to work, so there is no point coming to an agreement with one without the other. Depending on the size of the deal, it may be worth getting all parties together in a meeting to ensure complete transparency.

11. Make a recommendation

This step only applies if you are not the person who can act on the decision. Think of your audience whenever making a recommendation. Do they like to be able to reply to an e-mail with a yes/no option, or do they prefer a meeting? Do they know what is achieved by the news service and its role in keeping the firm current? Even though you made efforts at the start of this process to know the budgetary pressures, these can change and all your hard-work will be wasted.

12. Communicate the decision and what the implications are of that decision

Whether it is good news or bad news, communicating about a service is a potential minefield. Bad news, such as withdrawal of a service, means you have to negotiate even harder with your internal stakeholders, such as the partners, associates and previous recipients of alerts. A few small meetings with the main beneficiaries of the previous service can get them at least partially back on side, or may even provide some answers to give you leverage in the future. Listening is also an important part of delivering bad news, as it may be the key to turning the bad news into either a solution or a business case at some point in the future to reinstate the service.

Good news should be easier to deliver, but often it is not. In the current climate, if you are delivering a good new service with new features, people will wonder how you have got the time and money to do that! Start with the people who you contacted informally, those involved in the trial, and IT as they will feel left out if told at the same time as everyone else. Details can be scant, but you can make them feel special about more details following. Language such as ‘In our continuing effort to get the best deals from our suppliers…’ and ‘by leveraging our relationships with existing suppliers we have managed to deliver an exciting new service…’ will make it clear that bargains are being thought of, but you do have something new to say.

13. Make a note of all your hard-work for your annual appraisal

After the long-hard process has been gone through, you need to sell yourself. Remind people of the contribution you have made, whether it is saving money, continuing to deliver a service on a tighter budget, or finding something new without spending anything more than previously. After all, you are in a way negotiating for your career, your pay and professional respect.

Good negotiation is therefore like an iceberg, with most of the hard work taking place well ahead of an actual discussion about price or terms.