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Article

Title: Partner Power

Author: Garretson, Rob Article Type: Product Analysis
Source: CIO INSIGHT, n58 p43(5) Publication Date: Oct 2005
  Illustrations: Charts
URL of Publication: http://www.cioinsight.com

Vendor partnerships are currently not very prevalent in IT research, but industry analysts contend they are increasing. More common in vertical markets such as healthcare, financial services, and law, such agreements allow CIOs to get custom software at competitive prices by partnering with a vendor. This can also result in royalty revenues if the vendor ends up reselling the software. The vendor benefits by receiving an education via its customer, and by developing marketing and experience that can be used in sales efforts down the line. Another reason for the proliferation of such partnerships is that firms have become increasingly dependent on large enterprise application vendors and their prepackaged software offerings. These partnerships come with caveats. It is imperative for the parties to understand the contracts, agree as to who owns the intellectual property, and anticipate hidden expenses. CIOs who have been successful with vendor partnerships agree that the most important factor is that both sides are equal in benefits and contributions. This does not mean 50-50 equity or equal shares, but translates to a relationship with equivalence that is not one-sided. Vendors trying for maximum profits with minimal risks combined with customers who only want the lowest possible price for software are unlikely to forge a smooth partnership.

Special Features: Charts

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Collaborative Commerce

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