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AWS Marketplace serves as a comprehensive digital catalog of third-party software, services, and data that simplifies the process of discovering, purchasing, deploying, and managing software on Amazon Web Services (AWS). By leveraging AWS Marketplace, organizations can drive innovation through access to thousands of software listings, while enhancing software governance with clearer approval processes and spending visibility.
When engaging with procurement teams about AWS Marketplace, a common inquiry is, “What are the best practices to maximize our use of AWS Marketplace?” Here are seven key strategies for procurement teams looking to make the most of their AWS Marketplace experience, whether you are just beginning or seeking to enhance and scale your usage.
1. Cross-Functional Alignment
As organizations embark on their AWS Marketplace journey, transactions are often handled individually, leading to knowledge silos rather than standardized procedures. This fragmented approach can create misalignment and operational friction as usage expands.
It is essential to ensure alignment on how AWS Marketplace integrates into the procurement process, involving input from diverse stakeholders such as cloud, procurement, legal, and finance teams. Documenting the approved process allows for consistent application and communication, helping educate stakeholders on the organizational use of AWS Marketplace.
2. Empower Procurement
Organizations often find that a single technical stakeholder, typically the cloud admin, becomes the primary point of contact for AWS Marketplace activities, such as accepting private offers. This can lead to delays and potential non-compliance with procurement policies.
AWS suggests that the procurement team should take the lead in reviewing and approving offers on AWS Marketplace. This ensures that all necessary steps are completed before accepting any offers and that procurement is involved in negotiations.
To manage access, AWS Identity and Access Management (IAM) roles can be utilized, creating roles such as procurement purchaser (with permissions to buy) and procurement viewer (with permissions to view subscriptions without purchasing). Using AWS managed policies or custom permissions can help tailor access as needed.
With private marketplaces, self-service procurement becomes possible, allowing organizations to curate lists of third-party offerings and control who can make purchases. This facilitates efficient access to products, including free trials and flexible pay-as-you-go options. Additionally, the Bring Your Own License (BYOL) model can be used to maximize deployment efficiency using existing licenses from third-party vendors.
3. Plan Ahead
It’s vital to establish a pipeline of potential AWS Marketplace opportunities, outlining upcoming software investments and renewals. Without proper planning, AWS Marketplace may become an afterthought, resulting in delays and inefficiencies.
Creating a structured opportunity pipeline ensures that AWS Marketplace is integrated early in discussions with software vendors, giving them the chance to consider listing solutions not yet available. Engaging proactively with AWS can also help bring attention to software solutions you need that aren’t currently on the platform.
4. Evaluate Products
The extensive selection of products in AWS Marketplace, including free trials and pay-as-you-go pricing, allows organizations to perform due diligence on software solutions independently. This can be done through proofs of concept, without needing to interact with sales personnel. Once potential solutions are identified, organizations can request Private Offers for further assessment.
Many customers consult AWS when exploring new solutions, as AWS provides valuable resources across various categories (infrastructure, machine learning, business applications) that can aid in your planning and analysis.
5. Negotiate from a Strong Position
Organizations often find themselves negotiating from a disadvantage with software vendors, starting with vendor-favored boilerplate contracts. This can prolong negotiations and result in unfavorable terms.
AWS Marketplace provides the opportunity to use pre-negotiated contract templates, known as the Standard Contract for AWS Marketplace (SCMP), to accelerate transactions. This standard is applicable to over half of the listings in AWS Marketplace, and vendors who do not use it publicly may accept it in private offers.
To effectively utilize the SCMP, review the terms with your procurement and legal teams, then create amendments tailored to your specific needs. This provides a consistent base for negotiations, thus streamlining the process with various software vendors.
6. Maintain Commercial Flexibility
AWS Marketplace features enable sellers to control payment timing and adapt agreements to meet evolving business needs. The flexible payment scheduler allows sellers to set billing dates that align with your organization’s financial requirements, such as budget cycles.
Existing agreements can be renegotiated to reflect changing circumstances, such as new pricing or contract terms. This flexibility can significantly enhance your procurement strategy.
For more insights on leveraging AWS Marketplace, you might want to check out this blog post on SpareFoot. Additionally, SHRM provides authority on effective talent acquisition strategies, which can be beneficial when navigating vendor negotiations. Lastly, this article on Amazon’s onboarding experience serves as an excellent resource for understanding effective practices.
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