Project Management Central

Please login or join to subscribe to this thread
When do you authorize payment?

Typically, when involved early enough in the software vendor selection process, I will recommend that we negotiate payment in phases, either as progress payments over the length of the implementation or, for shorter projects, an initial payment at contract signing and the balance upon completion of acceptance testing.

Recently, I have worked with several divisions that just approve payment in full at contract signing, stating that this is an industry norm. In my opinion, this removes some of the incentive for the software vendor to stay on schedule or honor any requests for remediation at project close, should the software not perform as expected.

I am curious how others manage their vendor contracts and payment. Please let me know your thoughts and current practices. Thanks!

Each time I have seen a full payment up front, we learn of fraud, problem or similar later.

In case I have seen payment upfront, but back by bank guaranteed, was not in IT.

Milestones payment is the most effective, generally speaking.

Please login or join to reply

Content ID:

"In three words I can sum up everything I've learned about life. It goes on."

- Robert Frost