The HESS Consortium and E&I Cooperative Services Partnership
Since we founded the HESS Consortium in 2015, we have grown quickly with a wide array of institutions with various ERP systems. While we have a great group of chief information officers and chief financial officers with various contract experience, our HESS board of directors has long felt the need for stronger experience in collaborative contract development, negotiations and management. This experience is necessary for our members to get the best features and pricing possible while our software partners can be assured that all of the collective terms and conditions for our various institutions are coordinated and met. This need has been obvious to us from the beginning of our consortium and is why an affiliation partnership with E&I Cooperative Services is so valuable at this point.
E&I Cooperative Services is a not-for-profit cooperative that was founded in 1934 whose mission is focused squarely on collaborative higher education contracts.
With 4,000 member institutions in E&I, they have the experience with highly complex contracts and have the expertise in negotiating and managing these contracts for their members. Your institution is most likely a member of E&I now. The agreements are non-binding to members so HESS’s agreements will now be non-binding, departing from the original concept of the HESS Consortium. With this, E&I has “skin in the game” to make sure their contracts are as valuable as possible for our institutions as they are fair and helpful for our software partners.
With the recent memorandum of understanding (MOU) between HESS and E&I (member login required), E&I’s contract management, led by Keith Fowlkes (HESS co-founder, board member and now E&I executive leadership), will now be working with our individual software partner cohorts to competitively develop, negotiate and manage collaborative contracts for our member institutions in HESS. This means that HESS members will now have access to competitively researched and negotiated features and pricing from our software partners. Also, in support of our members and software partners, our institutions will have E&I contract support people to work with them to adopt the contract agreements. Contracts will still be between the software partner and the member institution. While E&I’s services are provided at no cost to the HESS member institutions, there is a small negotiated administrative fee that each vendor will pay E&I based on that contracts’ use.
E&I’s contract services also add great value for our software partners in allowing them to cut enormous overhead and time in individually negotiating contracts and their support, bringing their work down to a single negotiated contract agreement for all schools in the cohort (see section below "How does this new relationship help our software partners help us?"). Also, all questions about the contracts and what they offer can be directed to E&I contract and technical support staff. E&I makes our software partners’ operations more efficient and effective for your institutions.
As we see success with HESS member institutions with these collaborative, E&I will invite these same software partners to participate in national contracts with E&I’s members among public institutions. As in HESS and its private institutions, E&I can add value to all of its software partners by helping to develop this more complex state and federal contracts, terms and conditions, regulatory restrictions and pricing with its larger public E&I members.
How does this new relationship help our software partners help us?
- E&I, in partnership with HESS cohorts and software partners, normally starts by developing a detailed RFP with a standard terms and conditions listing that satisfies all the institutions’ needs both functionally and legally. E&I then solicits that RFP publically for vendor responses and, with our cohorts, selects one or more companies for award(s) based on the offerings (features, prices, options, etc.) to the institutions.
- An E&I/HESS agreement gives our partners one single master level agreement that those companies can then use for their RFP response(s) from any of the member schools. Currently, those companies would have to individually respond to each and every RFP from individual schools. That could be 100s or 1000s of responses, visits, demos and sales calls each year.
- E&I then has support people 24/7 to answer questions about the contract details and walks the institution through the process of signing on to the contract and using the pricing and agreed to terms and conditions.
- E&I also has a marketing communications team that promotes the contracts available to all of the members both electronically and in person, and puts them in touch with the technical support team if there are technical questions on the contract. When there is a need communicated from one of the members, the E&I marketing team can put the vendor in touch with the school, often times making the call with the vendor to make the introduction.
- E&I works with the HESS cohorts with any contractual issues and yearly negotiations on agreement renewals and new products/pricing as a collective group ongoing.
- E&I negotiates a contract fee of between 1-3% of the contract activity from their supplier partners as the contract fee from the supplier partner. Any “revenue” over and above our costs is dispersed yearly back to our members who use those specific contracts as a rebate. (example: a 1-3% contract fee annually on a support and maintenance license of $250,000 is between $2,500 - $7,500, charged to the individual software partner.)
- As found to be true by our other E&I technology supplier partners (Xerox, GovConnection, Juniper, CDWG, Canon, HP, SHI, Jaagaer, and others), the fee is miniscule compared to the savings in time and expense involved in individually negotiating terms and conditions, pricing, annual maintenance and support and legal review with each individual institution. Part of the realized savings by the software partner can then be passed on to member institutions.
- Not to worry... the contract is still directly between the institution and the software solution partner. E&I continues to do the work behind the scenes updating the contracts for industry and higher education regulatory changes, managing the contract terms and conditions (as needed) and working between the cohorts and their software partners on pricing and feature changes.
- With successful HESS agreements, E&I reserves the right to invite HESS software partners to go through their state and federal procurement bid processes for all of E&I's 4,000 educational cooperative members. This creates a path for HESS software partners to access a much larger state, public and private higher education audience to market for their software solutions.
E&I Cooperative Services has been doing this since 1934 and the method has been proven to save both consortium members and their suppliers time, money and frustration in their procurement processes and operations.
The HESS Consortium Board of Directors strongly believes that this collaboration with E&I Cooperative Services will strengthen its contract agreements and make stronger the bonds between our member institutions and our software partners. Starting March 24, 2017, the contract agreements that are developed will now be completely voluntary for HESS members. In the spirit and mission of the HESS Consortium, we do hope that our members will make their best effort to assist us in the successful negotiation of “best in breed” pricing and features in partnership with our software cohorts and use the contract agreements.
In closing, we are all in this together, our institutional members and our software partner companies. We all need to be successful to serve our unique organizational missions. We all need to more closely communicate our successes, challenges and best-practices. To see success in this new economy, we all must actively engage in collaboration to make sure that our organizations continue to survive and thrive.
Let this be the year that we all truly make this commitment to each other to work together for the common good for all of our organizations!