The Fine Print - ... The Fine Print: A Guide to a Strong Contract and a Successful Relationship in General

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  • D E

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    A Guide to a Strong Contract and

    a Successful Relationship in General

    Corporate Support Services

    The Fine Print:

    Canon Business Process Services

    Ted Ardelean, Director, R&D Marketing

    Kevin Shotsberger, Director of Operations Midwest Region

    www.sig.org/eval

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  • The Fine Pr int : Contract ing for General Corporate

    Support Services

    A Guide to a Strong Contract and a Successful Relationship

    Ted Ardelean

    Kevin Shotsberger

  • Presented by

    Ted Ardelean

    Director

    R&D Marketing

    Kevin

    Shotsberger

    Director of

    Operations –

    Midwest Region

    4

  • About Canon Business Process Services, Inc .

    S u b s i d i a r y o f C a n o n U . S . A . , a C a n o n G r o u p C o m p a n y

    S e r v i c e s

    • BPO: AP, document processing, legal coding

    • DPO: Imaging, records management, print, mail

    • Office Services: Reception, hospitality, A/V, Admin Services

    • eDiscovery: Physical, digital, consulting, technology

    5 , 0 0 0 p e o p l e

    S e r v i c e d e l i v e r y :

    • On-site, Off-site, Off-shore processing centers

    • Six-sigma process excellence based methodology

    • Customized, supplementing client technology with CBPS technology

    I A O P T o p 1 0 0 G l o b a l O u t s o u r c i n g L e a d e r 2 0 0 7 t o 2 0 1 4

    5

  • S e r v i c e d e l i ve r y: • On-site, Off-site, Off-shore processing centers

    • Six-sigma process excellence based methodology

    • Customized, supplementing client technology with CBPS

    technology

    S e r v i c es • BPO: AP, document processing, legal coding

    • DPO: Imaging, records management, print, mail

    • Office Services: Reception, hospitality, A/V, Admin Services

    • eDiscovery: Physical, digital, consulting, technology

    S u b s i d i a r y o f C a n o n U . S . A. ,

    a C a n o n G r o u p C o m p a n y

    5 , 0 0 0 p e o p l e

    I AO P To p 1 0 0 G l o b a l

    O u t s o ur c i ng L e a d e r 2 0 0 7 t o

    2 0 1 4

    About Canon Business Process Services, Inc .

    6

  • Agenda

    ON-SITE CORPORATE SUPPORT

    SERVICE S OVERVIEW • Range and Scope of Services

    • On-Site Service Characteristics and Requirements

    CLIENT REQUIREMENTS AND

    CONTRACT CONSIDERATIONS FOR: • Employees and Staffing

    • Equipment and Supplies

    • Disaster recovery Considerations

    • Contract Change Dynamics

    • Mutual Risks and Liabilities

    • Serviced Delivery Considerations

    • Ensuring the Value of SLA’s

    • Potential Support Services Outcomes and Impacts

    Q&A

    7

  • Overview: Range and Scope of Support Services

    C O R P O R A T E S U P P O R T S E R V I C E S P R O V I D E D

    O N - S I T E C AN B E O F F - S I T E AN D O F F - S H O R E C AN B E

    • Mailroom, Shipping & Receiving

    • Central reprographics (print/copy centers) and

    office print management

    • Document Processing Centers (combined mail,

    print, scanning activities)

    • Records Management and File Room

    Management

    • Reception and Telephone Console Operation

    • Audio Visual and Conference management

    • Concierge Services

    • Light office maintenance

    • Facilities Management Administration

    • Material handling and internal logistics

    • Professional Administrative Services

    • Overflow reprographics (print/copy centers)

    • Document Processing Centers (scanning

    activities)

    • Records Storage

    • Hard copy imaging conversion

    • Indexing of scanned documents

    • Quality Assurance controls

    8

  • On-si te Service Character ist ics That Impact Contract

    On-site Service

    Characteristics

    SLA

    Employee

    Concerns

    Equipment &

    Supplies

    Disaster &

    Recovery

    Exceptions to

    Scope of Work

    Start-up &

    Termination

    Risk and

    Liability

    Service

    Delivery

    9

  • Employees/Staff ing

    C O M M O N C L I E N T R E Q U I R EM E N TS C O N T R AC T I S S U E AN D P R AC T I C E

    • Benefits Offered

    • Compensation and salary ranges

    • Hiring staff back in-house or transfer to a new

    provider

    • Bonded, background check expenses

    • Easy staff placement or discharge

    • Permanent or Temporary Staff

    • Similar vacation and holiday policy, HC plan,

    401K Plan to that of client

    • Maintain salary for certain staff being

    outsourced (Re-badged)

    • Restrictions: Employee transfers 20% fee.

    Enablers: SOP documentation for job continuity

    • Bond coverage ‒ 1 mil. each employee

    • In placement provider has final decision

    • In discharge, client has final decision

    • Not a contract issue as much as a cultural issue

    10

  • Equipment and Suppl ies

    C O M M O N C L I E N T R E Q U I R EM E N TS C O N T R AC T I S S U E AN D P R AC T I C E

    • Flexibility to replace equipment any time at no

    charge (e.g. print, scan & mail equipment)

    • No mark-up on supplies

    • Volume discounts benefits (e.g. UPS, FedEx,

    Staples, toner, postage, etc.)

    • 10% of equipment replaceable during life cycle

    • Leases assumed by client upon service

    termination, prior to contract expiration

    • Purchases made in client name. Client pays

    supplies directly. Provider distributes reviews,

    approves and processes invoices.

    • Provider sets up client account. Client gets

    better price, by leveraging providers buying

    power. No mark-up

    11

  • Disaster Recovery Preparedness

    C O M M O N C L I E N T R E Q U I R EM E N TS C O N T R AC T I S S U E AN D P R AC T I C E

    • Back-up, over-flow facility

    • Established Policy & Procedure, training

    • Provider contingency facility or contract with 3rd

    party, as backup

    • Joint plan. Provider required to train staff to

    follows client policy and procedures

    12

  • Except ions to Scope of Work

    C O M M O N C L I E N T R E Q U I R EM E N TS C O N T R AC T I S S U E AN D P R AC T I C E

    • Freedom/flexibility to quickly change, redirect

    services provided

    • No formal change order or contract

    amendments for scope of service

    • Amendments to service scope and price

    • Scope of service written in broadest terms.

    • Too much client interference can erode provider

    margin, interfere with SLA

    • Provider exposed to greater liability.

    Comprehensive, limited liability ($1 to $10

    million) carried by provider

    • For significant and permanent service changes

    (add a service) contract amendments are made

    13

  • Start -up/terminat ion and changing providers

    C O M M O N C L I E N T R E Q U I R EM E N TS C O N T R AC T I S S U E AN D P R AC T I C E

    • Start-up and implementation planning and costs

    • Terminate for convenience or for cause

    • Written implementation plan and description of

    client involvement requirements

    • Costs amortized into monthly payments

    • Outstanding lease obligations recovered upon

    termination for convenience

    • Employee transfer fee 20% of annual salary

    • Full knowledge transfer and coordination with

    client or new provider

    14

  • Mutual Risks and Liabi l i ty Protect ion

    C O M M O N C L I E N T R E Q U I R EM E N TS C O N T R AC T I S S U E AN D P R AC T I C E

    • Unlimited Liability vs. Defined Liability

    • Comprehensive insurance coverage

    • Disaster recovery and information's security

    • Price guarantee/Volume guarantee

    • Limit provider liability through caps $1 to 10

    million

    • Mandatory staff training on information security

    practices

    • Provider at risk when the actual client

    volume/data is less than what was proposed ‒ Minimum volume clauses protect both parties

    15

  • Service Del ivery and Operat ional Performance

    C O M M O N C L I E N T R E Q U I R EM E N TS C O N T R AC T I S S U E AN D P R AC T I C E

    • Can Provider cover all client locations