Most loyal Central Perk-loving ’Friends’ addicts know the small details of each of their favorite Friends characters. Phoebe’s a massage therapist/smelly cat singer; Rachel’s a marketing manager/shopaholic; Monica’s a head chef/neat freak; Joey’s an actor/foodie; Ross is a paleontologist/walking encyclopedia.
And Chandler, Chandler’s a sarcastic… wait, what does Chandler do again?
Most die-hard fans of the show know the characters inside out, but like Monica and Rachel in a sudden-death trivia round, most fans cannot answer the question: ‘What is Chandler Bing’s job?’. It took over 10 years and Google to finally solve the mystery. Chandler Bing is an IT Procurement Manager.
Badabing! Chandler is the guy in your company who plays a fundamental role in the negotiations of your technology services agreements. Now, what might Chandler look for in his good old tech agreement?
The customer in a technology services agreement (and in this case, Chandler) will often negotiate these three (3) main concerns of theirs:
- Transfer of ownership or a grant of a license;
- Dates and deadlines for receiving and accepting the deliverables and services; and
- Warranty for the deliverables and services.
If Chandler and his work team realize that the product (deliverable) they received under their technology services agreement does not function according to Chandler and team’s liking or to their expectations, the vendor would have the obligation to remedy the defect within the warranty period that the vendor and Chandler and team have agreed to. However, both parties will have different positions about the warranty provision, so it can be heavily negotiated, depending on the relative bargaining power of the parties.
Issues that often arise when negotiating a warranty provision include:
- The length of the time period a warranty will be provided for;
- When the warranty period will begin;
- What will be excluded from the warranty; and
- The time period within which the vendor will be required to remedy a defect.
The customer will generally try to broaden their rights to warranty by negotiating:
- A longer warranty period (for example, a one year warranty);
- The warranty period to begin at a date later than acceptance;
- A broader warranty coverage (for example, warranty to include any and all minor defects, and bug fixes); and
- The product to be remedied within a short time period (for example, the customer may include language that states the vendor will remedy any defects within 10 business days).
Chandler and team may also negotiate that a refund be provided if their product is not remedied within the deadlines included in the warranty period.
The vendor will often try to push back on warranty by negotiating:
- A shorter warranty period (for example, a 6 month warranty);
- The warranty period begins as soon as the product is delivered, regardless of acceptance by the customer;
- Limitations to what the warranty will cover (for example, the vendor may include language that states the warranty will not include any defects or bugs caused due to changes made to the product by the customer); and
- A longer period to remedy the issues (for example, the vendor may negotiate the specific (longer) time period provided to remedy the breach and/or the vendor may include language that they will allocate resources for remedying a warranty on a part-time basis)
The warranty period is an important portion of a technology services agreement for the customer. It assures them that the product/service they are agreeing to purchase will meet the standards agreed to by the parties, and if it does not, the vendor will remedy it to a point where, in the words of Chandler, the customer will say: ‘could the product BE any more perfect’!
Takeaways:
- A warranty provision will assure the customer that the product will meet, or will be remedied to meet the customer’s standards.
- A customer will generally want to negotiate a longer warranty period, with broader warranty coverage and a shorter time period to remedy the defect.
- The agreement should include clear standards to be met under the warranty.