Company A was negotiating a $2B managed services deal with its customer, Company B, and as a result needed to prepare to acquire a large number of supplier contracts from Company B. Company A had to “take over” the supplier contracts, but had no idea what terms were originally agreed to and what risks and obligations Company A would be taking on. Company A needed to understand the volume of contracts, the risks and exposures they entailed, and how substantially the contracts deviated from its own requirements and standards. This was a huge and daunting task that would require a lot of time. Furthermore, the legal and procurement department personnel were already overloaded with other work.
After some collaborative discussion with Company A, we formulated a team to step in and handle the transition of the procurement contracts and related documents. A plan was developed and tracked in order to make sure everything was covered in a timely manner. First, after a preliminary understanding of the strategies, policies and procedures of both Company A and Company B, the documents were organized and stored on a secured and encrypted data room. Incorporated into the plan were a review process, gap analysis, business analysis, risk assessment, priorities and disposition options. Templates and approval processes were created with an eye for simplicity and efficiency.
Over 2,000 supplier agreements were effectively transitioned to Company A in 9 months. Risks were minimized significantly due to the organized, focused review and analysis and the resulting ability to prioritize and close as many gaps as possible during the transition. Our team was also involved, from a procurement perspective, in the negotiation and closing of the managed services contract between Company A and Company B.. Company A personnel were able to participate in the transition but did not need to take time away from their full-time jobs to do so. Our involvement also gave Company A an “end in sight” and completion window, which allowed the business operations to move forward quickly, without the constant need to revisit transition activities.