The only other way you can get around this unfortunate situation is to start early and take the negotiations seriously as quickly as possible. In the past, the intensity of the negotiations peaked about one to three months before the renewal, but now, in order to reach the most ideal agreement, negotiations should begin seriously about three to six months before renewal. Microsoft`s mission is to transfer its customers within the traditional on-premise software company to its subscription-based cloud services. Revenue from its cloud commercial offerings is growing strongly, while traditional software sales are declining and the mix is weighing on Microsoft`s ability to support a multi-faceted business. Microsoft`s success will be measured against the success of this mission, and customers will be under increased pressure to travel to the cloud or to pay for on-prime-price solutions through increased contract and price complexity. Most customers have managed the jump to 365 and are experimenting with azure. The good news is that the window of agreement for new cloud editions with Microsoft is still open. You may need to be prepared to go beyond the expiry date to get Microsoft`s flexibility. We`ve seen organizations that have spent two months beyond the expiration date to finally reach an agreement with Microsoft. Stopping the watch to make a Microsoft representative sweat might have led to a better proposal as the actual expiration date approaches. However, this strategy no longer produces the results sought by customers, as microsoft has shifted the pressure on the customer and should not improve its proposals even as the renewal date approaches. Microsoft is putting unprecedented pressure on its sales teams and chain partners to improve revenue forecasts and impose term extensions. Sales commissions and commissions paid to resellers have a negative effect if the AES are not renewed within the allotted time.
Since tight deadlines don`t have much to say, we recommend that you give yourself enough time to prepare. Before, it only took you three to six months to prepare, but now you may need nine to twelve months. The first six months should be used to make sure you have a full handle for what you actually need from Microsoft, and the remaining three to six months must be used to actually negotiate the extension.