A Guide to Agreement Negotiations for Professional Services Firms

In professional services, project success often hinges on the quality of the agreements underpinning them. And yet, despite the critical importance of these agreements, inefficient contract management practices persist—increasing administrative costs and potentially hurting competitiveness and client relationships. Key challenges include:

• Identifying and mitigating risks 
• Aligning business objectives and legal obligations
• Adhering to security criteria 
• Establishing metrics for monitoring obligations

How can professional service organizations conquer these challenges to accelerate the speed of business, enhance risk management, and secure mutually beneficial partnerships?

For insights on how to approach professional services agreement negotiations with greater confidence and agility, we sat down with Rohan Gupta, Principal at Deloitte Consulting LLP, and Eryc Branham, Managing Director at Deloitte Consulting LLP. Rohan brings wide-ranging experience developing and negotiating professional services agreements such as SOWs and change orders. As Managing Director in the Technology, Media, and Telecommunications (TMT) industry group, Eryc frequently deals with complex, larger-scope, and longer-term professional services agreements such as MSAs.

Leverage data for a more holistic approach to negotiations

When discussing preparation leading practices for professional services agreement negotiations, Rohan underscores the importance of adopting a holistic approach that encompasses both business and legal implications. “As an attorney, you look at legal risk. As a salesperson, you look at relationship risk. And, as a finance person, you look at payments,” he explains. “But coaching your team—and yourself—to look at agreements holistically can significantly reduce risk and enhance outcomes.”

To foster a more comprehensive approach to negotiations, he advises considering the following questions:

• Which risks might I be overlooking?
• What elements can be mitigated because the costs outweigh the benefits?
• Which aspects are worth advocating for?
• Which elements pose long-term risks?

Additionally, Rohan stresses two key focus areas for teams and individuals: data and increased risk awareness. “It’s simple: the more data you have, the more efficient you’ll be,” he shares.

“To get high-quality, granular data, you need tools that allow you to extract simple and complex elements from agreements—from renewal dates to the risk profile adopted on each side—and enable you to draw correlations between your systems: CRMs, ERPs, etc.” 

Set the stage for success with a robust agreement framework

Eryc uses Master Services Agreements (MSAs) as an example to demonstrate why it's crucial for agreements to have the right terms and conditions from the outset: “The goal of an MSA is to create a robust framework to lay out the general terms and conditions that will define how you engage with a client on an ongoing basis,” he explains. “And the main question on your mind should be: How can I ensure that these terms align with the long-term relationship we're building?”

Besides the benefits of securing legal protection and setting the stage for a mutually beneficial relationship—he points out that a strong MSA generally means smoother and quicker drafting of future Statements of Work (SOWs):

“Getting that foundational document right can enable you to draft SOWs with minimized negotiation.” 

Eryc recommends that you focus your prep on three main areas during negotiations:

• Business goals: What kind of business arrangement are you seeking to codify in the agreement and which stakeholders will be involved?
• Legal considerations: What are some of the legal concerns that come with the type of relationship you’re seeking to build? 
• Risk assessment: Which items are most likely to get pushback based on your client's risk profile?

Reinforcing this strategic mindset, Rohan notes that it’s important for teams first to understand the constraints they’re working under and then identify which levers they can pull based on the outcome they want to achieve. “Work out which tools are at your disposal and—most importantly—determine the implication of using those options,” he concludes.

Fast-track decision-making with early alignment and standardized processes 

When discussing bottlenecks in the negotiation process, Rohan and Eryc point to four stages that frequently experience delays: 

• Choosing agreement templates
• Initial presentations
• Change orders and renewals
• Disputes

Agreeing on a template during the early planning or scoping stages is crucial to ensure both parties start the process aligned on structure and content, explains Eryc. “Very often, each party will have its own standard agreement template,” he shares.

“If you don’t have a conversation upfront about whose paper you’ll be starting with, you can end up spinning a lot of wheels.” 

This standardization, he adds, paves the way for smoother negotiations and can help reduce the need for extensive revisions later in the process.

Rohan highlights that the primary challenge with initial presentations is unpredictability. “I’ve had a wide range of experiences—from clients who sign instantly to others who will take weeks and multiple rounds of legal reviews.” With change orders, it’s time expenditure: “When you’re working with complex agreements for highly complex services, a seemingly small change can take much longer than anticipated.” Standardization and early alignment on terms and expectations, he says, are critical for streamlining both processes and minimizing excessive back and forth.

He also stresses the significance of eliminating interpretative language to prevent disputes during and after negotiations. “Disputes often come down to interpretation.”

“Drafting clear contract language can eliminate many of those opportunities for misinterpretations and inconsistencies.”

Leveraging technology with data extraction capabilities, adds Rohan, can ease these bottlenecks by helping your team locate and flag ambiguous or subjective clauses.

Both agree that one of the biggest sources of delays in a negotiation is assigning equal importance to all terms. To avoid this, Eryc suggests that teams develop a priorities scale before starting negotiations.

“Identifying which items you can agree on quickly and which need further discussion will enable faster decision-making and save you time.”

Track the quality of your efforts and the strength of your relationships

To help ensure your agreements are achieving their intended goals, consider the following metrics:

Financial: “When you commit to a set price, it’s important to correctly estimate the level of effort it will take to deliver that work,” says Rohan. “Because you’ll be tracking everything against that estimate: actual billings versus anticipated billings, actual cost versus anticipated cost, and actual margins versus anticipated margins.” To track your efforts more effectively, he suggests you keep the following questions in mind:

• Are we getting paid on time?
• Have all committed deliverables been fulfilled?
• Did we correctly estimate the level of effort it would take to deliver that work?

Relationship: Qualitative elements such as feedback on the work and relationship-building warrant as much attention as quantitative metrics. “Contracts are the results of good business relationships,” says Rohan. “And, ideally, you should track everything that led to that event. This means keeping tabs on the quality of your business relationship from day one.” Questions he relies on for evaluating business relationships include:

• Why did we win this contract?
• What feedback have we received from the client?
• Are there any additional opportunities beyond our scope?

Disputes and amendments: A measure of the quality and durability of your agreements—especially MSAs—is the volume and frequency of amendments and disputes. “The number of amendments you have to make could tell you whether you got the agreement right and whether it accurately reflects your relationship with the client,” explains Eryc. To help you gauge the strength of your agreements, he recommends the following questions:

• How many disputes have there been on terms and conditions?
• How frequently are you amending terms?
• Are amendments necessary due to evolving relationships, or are they a result of inaccuracies in the initial agreement?

Adopt a relationship-centric view of your professional services agreements

Rohan and Eryc agree that a holistic approach to professional services agreements negotiations starts with technology: “Historically, tracking metrics and integrating insights across systems meant lots of manual work and human glue,” says Eryc. “But technology has come a long way to giving us a more comprehensive view of agreements. We can now look at them from a relationship perspective as opposed to a bunch of data points sitting in a CRM or ERP.”

This broader view, he explains, can help professional services organizations better understand and manage their contractual relationships. Eryc concludes:

 “Professional services agreements are not static documents that you store away in a library and forget about—they’re dynamic tools shaping behavior and decision-making. They govern every transaction and every connection point you have with a client. Keeping them highly visible and easily accessible will empower you to leverage their full potential and help you maintain successful business relationships.”

The new Docusign Intelligent Agreement Management (IAM) platform empowers your team with enhanced insights into your agreements for superior end-to-end lifecycle management and stronger partner relationships. Learn how it can help accelerate your negotiations and maximize your value from professional services agreements.

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