Many large outsourcing deals are negotiated by a specialist “deal team” that will, once the ink has dried on the project documents, inevitably depart in search of the next deal. Behind the deal team will come an operational team charged with implementing and running the outsourcing project on an ongoing basis. However, unless the deal team has effectively passed on their knowledge of the deal, this operational team will often be ill-equipped to perform their role and will not know the background to the transaction documents that they are expected to apply in practice. In this note, we set out our top 3 tips for effective knowledge transfer.
(1) Prepare a contract guide
Before departing the scene, the deal team should always prepare a guide to the transaction that includes an explanation of all relevant deal dynamics. The guide should set out the key commercial and operational issues discussed during the negotiation and how these have been dealt with in the project documentation. The guide should also include an overview of each transaction document and summarise its key features. This is particularly useful for commercial staff who are not used to reading and working with complex legal documents.
(2) Hold hand-over meetings
To complement the contract guide, it is often useful to hold hand-over meetings so that relevant members of the deal team can explain the deal to the operations team in person. In this case, the deal team will also be available to answer any questions that the operations team may have. This type of question and answer exercise may even flush out issues that were not necessarily anticipated during the negotiation.
In addition to holding hand-over meetings, it can also be a good idea to keep at least one member of the deal team on the project for a defined period (say six or 12 months) in order to help the operational team get up to speed on the transaction. This is particularly important if the project is likely to have a complex implementation phase, as key issues will often arise during implementation and it may be invaluable to have a deal team member available to explain the contractual mechanisms for dealing with those issues.
(3) Prepare an obligations calendar
On a large outsourcing project with multiple work streams, it can be difficult for the customer to track the supplier’s performance and ensure that all relevant service deadlines are being met. For this reason, it is often useful to prepare a calendar of obligations so that the customer can easily see when important deadlines are looming and also track the supplier’s performance against those deadlines. Having a ready record of the supplier’s performance can also be useful in a dispute scenario, when the customer may want to show a pattern of under-performance on the part of the supplier.
Apart from monitoring the supplier’s performance, an obligations calendar can also help the customer keep on top of its own responsibilities for providing inputs to the supplier. The customer may need to provide inputs at various stages during the project, such by providing a statement of service requirements, or approving an implementation plan or acceptance testing schemes devised by the supplier. If the customer fails to provide these inputs in a timely manner, it may allow the supplier to blame any delay in performance on the customer and seek an extension of time.