I have just renewed my gas central heating support contract at a higher price even though for the umpteenth year running I had no need to use it. Of course we must have support in place for the fear that it will fail on the one cold night a year that an elderly relative is staying!

We feel that same way about engineering support contracts and having been both sides of the fence – as a customer and vendor, I can put both sides to you:

To the vendor, the cost of support is a certainty; it is baked into the sales and bonus target at the financial year’s outset. It is a very profitable annuity (a Golden Goose) stemming from the past year’s equipment sales efforts, it inevitably will be renewed.

For the operations team, last year’s support cost for key network elements is a foundation stone for their cost budget, (a Sacred Cow), in times of financial stress other items have to be cut first.

This does not have to be the case, all operations teams should target support contracts for continuous cost reduction in real and per network element terms. Are the contracts required? Is the response acceptable? Is the scope of service too broad?

Take a tough stance with your vendors, despite their threats to withdraw support unless the established fees are paid. My experience is that it only takes two calls to get the support action required, one to the support centre, if that fails, the second to their CEO.  In 2013 I implore you not to just renew contracts like I did for the central heating, step back and see what value if any has been delivered, cast aside the traditional “x%” of cost calculations and set an ambitious target for cost reduction and delivery.