Master services agreement for software development
Paper work is the thing the tech companies always are scared of. However, if company provides services under multiple business models it is always necessary to sign a sufficient contract with every client. Moreover, clients are the persons who like always to renegotiate some clauses of agreement which means you need to resign it. One solution for all of your problems is MSA or Master Services Agreement and here is why.
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T&M, Fixed Price and Outstaff rolled into one.
Many companies work under different business models, usually they are T&M, Fixed Price and Outstaff, with different clients. However, very often 60% of all these three agreements are the standard contractual clauses regarding confidentiality, dispute resolution, intellectual property etc. That’s why many companies are annoyed to sign the same agreements again and again.
Well, the only thing you need to have to not be annoyed anymore is the MSA. Basically, MSA consist of two parts:
- first part is Master Services Agreement for software development itself: it includes all the standard contractual clauses regarding your cooperation with different clients, e.g. confidentiality, intellectual property, dispute resolution etc.;
- second part is the respective Annex to Master Services Agreement: in includes all the essential terms and conditions regarding your cooperation with certain client, e.g. scope and list of services you provide under T&M business model, price and term of provision of services etc.
Usually, the standard Annexes are provided together with MSA for software development, namely Annexes for T&M, Fixed Price and Outstaff business models. However, list and content of Annexes to your Master Services Agreement could be customized according to your needs and specifics of cooperation with different clients.
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Easy to renegotiate.
Relationships with the client is always a delicate matter. Clients like to renegotiate the terms and conditions of the contract due to the circumstances only they know about. Anyway, permanence and necessity of renegotiation is a fact and you need to deal with it somehow.
Working under the Master Services Agreement for software development, it is much easier for you to renegotiate some terms and conditions of the agreement due to several factors:
- firstly, you do not need resign the whole agreement but only the Annex to it. Even of you need to change some clause provided in the Master Services Agreement itself you can change it be means of Annex which is usually 3-4 pages long;
- secondly, clients almost always want to renegotiate the terms of payment for software development services or acceptance of services or other matters which are provided under the T&M, Fixed Price or Outstaff Annex to MSA hence you again will need to resign the Annex only.
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Work under different business models under one agreement.
Probably the best part about the Master Services Agreement for software development is that it would be standard for all the clients. If certain client wish to change something in MSA you can always specify it in the respective Annex to MSA.
Therefore, you will have the one and only agreement for all the clients. If you need to remember or check what specifics of cooperation with certain clients you have it is necessary only to take a look at the Annex with this client. Thus, you do not need to go through 15-20 pages of Master Services Agreement but to take a look at your 3-4 pages T&M, Fixed Price or Outstaff Annex where everything is clear and understandable. Pure Delight.
Brief to remember
Master Services Agreement for software development is an elegant and ingenious solution for all businesses, including the tech companies. It allows the company to significantly reduce the amount of paperwork within the company and streamline the cooperation with clients. T&M, Fixed Price or Outstaff Annex deals with all the essential matters of cooperation with client.
If you practice machine learning in your company the Master Services Agreement is a real catch for you. It is much easier to automate the MSA signing process due to existence of Annexes than to automate the signing of different types of the agreements with clients.
Still, we highly do not recommend you to use the template MSA for software development you may find on the Web because it is exactly template. Such MSA does not reflect the specifics of your cooperation with the client therefore you may face significantly adverse issues in case of some conflict or dispute with one of your clients. If your agreement with client does not reflect the real state of affairs there are a high risks you will not be able to protect your interests.
Stay cool, stay chill, sign MSA.
Lyaskivskij Ivan
Senior IT lawyer