Cloud contracts – 3 questions to ask before signing

Every day we speak with firms (big and small) who are using cloud software. This could be an accounting package (Xero etc.), email (Office 365 etc), practice management software (Corematter, Actionstep, Clio etc) and the list goes on. Being in the IT business and partnering with cloud products, this is very encouraging to see and it certainly shows the continued push toward cloud software.

However, all too often, we speak with firms and when we start to talk about their current providers, we start to uncover a few issues. The common issues are;

1. The contract that they signed does not clearly state who is responsible and who has ownership of the data
2. There are no provisions in the contract for early termination if the service being provided is inadequate
3. Nothing that covers the ability to export all the data stored in the environment should they want to move to another provider or store a copy for disaster recovery purposes
4. Their contract is 3-5 years in length which makes the previous points even more damaging

The primary purpose of using cloud software it to get access to quality software on a flexible arrangement and to reduce the reliance on local servers and infrastructure. If you’re unable to get your data or terminate should the service no longer meet your needs, than the benefits of cloud are quickly outweighed.

If you are thinking of signing a cloud agreement, ask the provider these 3 simple questions.

1. Who owns my data and can I take a copy of it when I need it? If so, what is the process?
2. Is there a minimum number of licenses required and can I increase and decrease on a monthly or yearly basis?
3. If I am unhappy with the service being provided, can I terminate and either take a copy or receive a copy of my data for no additional cost.

This is by no means an exhaustive list of questions that you should ask potential cloud providers, but it will cover the flexibility options that should be built into all cloud systems.