Validation is an important step in the Software Escrow process. It provides an audit of the application development process to determine whether all the pieces required to build the application are present and accurate and proves that the application can be deployed in the event of a release. Without validating the Escrow deposit there are no guarantees you can continue your services and operations should a release event occur.
Due to the critical importance of a validated Escrow deposit, we maintain strict processes and are uncompromising in passing Software Validations until they have met our high standards. This means that on occasion, Software Validation exercises are unsuccessful or fail.
Validations can fail for various reasons. There may be shortfalls in the deployment process, bugs can be introduced during the development cycle, important equipment or resources may be overlooked and there is always the potential for human error. When they fail, what happens then? For the end users who generally fund these exercises, this can feel like they have been left with nothing of value.
Recently, a major international industrial organisation required several Validations for their Escrow agreements. Whilst most of the Validations passed without any problems, one encountered several glaring issues and could not be completed within the allotted and agreed timeframe. The Validation had therefore failed.
Following the failure, SES worked with all parties to identify what had gone wrong. The investigation uncovered significant new information about the build process and supplier relationship which the end user was unaware of. Whilst they had a long-standing relationship, many of the key individuals had moved on over time. The process of approving new versions of the product had become fragmented within the software user’s operation and important stakeholders only had visibility of parts of the process. Since the supplier relationship was first implemented, there had been another subcontractor employed by the supplier and their role was far more important than the end user believed. All this information was only discovered through the Validation.
For many of our clients, Escrow and Validation exercises are often prioritised for new supplier relationships but less so for those existing relationships where the software user feels more comfortable. However, as the above example highlights, there is a good argument and significant value in performing these exercises for all bespoke, revenue generating, business critical or highly customised products. Even with close supplier relationships, things change, vulnerabilities can creep into processes and internally, software users can become complacent with long-standing commercial arrangements.
Ultimately, SES worked with the supplier and end user to perform another Validation that was successful and ensures effective Escrow coverage across all agreements. The supplier and software user are working closer together to increase visibility on development timeframes and version control. The end user is looking at their internal set up and auditing process to make sure they are less likely to be surprised again. They have already identified similar supplier relationships where Escrow will be important. None of this would have been possible without the Validation.
For more information on how introducing Software Escrow protection can enhance your business processes and relationships with key suppliers, please get in touch to speak to one of our specialists.
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