What do you call a document describing rules for a commercial
relationship that one party can seemingly change whenever they want?

It's certainly not a contract with terms a reasonable person would expect. More of a decree from an overlord to a subject—which is especially bad in a commercial relationship that is extremely difficult for the subject to escape.
ERP access contracts, or any commercial contract, should describe the rules of the commercial relationship with typical and necessary language. Further, that any changes to the contract must be formally agreed to by the parties involved.  Well, a majority ERP sellers think this change process is old fashioned.

The Starting Point for Buyers

Risk profile difference: With respect to risk factors, there may not be a more naturally unbalanced commercial relationship than between those selling and buying access to ERP.

The ERP Seller's Risk: The seller's real risk is negligible. If an ERP buyer leaves, the seller loses a very small portion of their revenue. Other potential risks such as IP theft, force majeure events, and unreasonable warranty or indemnification claims are easily contained in reasonable contract language.

The ERP Buyer's Risk: On the other hand, an ERP project is one of the most costly and risky projects a company will ever undertake. If a commercial dispute arises, large potential new costs and risks can be forced upon the buyer of ERP access. If the processing of a commercial dispute is not successful for the buyer, then they live with the unfavorable situation indefinitely, or until the time for another high cost and risky effort to change ERP.

Completely one-sided commercial terms: ERP access contracts (subscription or perpetual licenses) provided by sellers are universally one-sided in favor of the seller—and these contracts have become increasingly worse for buyers over the years. These commercial terms contain carefully designed language that provides sellers with near-dictatorial control with a focus to preserve maximum options to increase revenue over time from their customer base.

The Imperative 

The comments directly above on relative risk of the parties and the initial status of contracts means there is serious work involved to get to a fair deal. However, getting commercial terms in decent condition with a seller of ERP is usually daunting—especially for sellers of subscription-based Cloud ERP.

In the coming weeks and months the writers for www.ERP-Costs.com will produce many blog articles about strategies and techniques to rise above the extreme self-interest forces in the ERP industry and related forces that want unilateral control in the commercial relationship. These articles will address the most pressing terms to arrange and then other articles will describe the multiple layers of smoke & mirrors in processing and maintaining such important commercial terms.

Future Articles Summary

Among many legitimate changes in ERP access contracts, the following are key commercial terms to arrange and future blog articles will provide substantial details:

• Dispute resolution terms in which the seller cannot make unilateral decisions on matters—but instead there’s a clear process with third parties if needed.
• ERP access cost escalation terms both for initial and future purchases of ERP access.
• The main ERP access contract has primacy over any current or future order forms and other commercial terms referenced in the main ERP contract related to its subject matter.

To lower barriers to fixing completely one-sided commercial terms buyers must:

• Communicate resolutely with ERP sellers about the large risk difference between the buyer and ERP seller—which underscores why the default commercial terms need to be fixed.
• Show no buy signals. Instead, if the buyer’s team just engages methodically and without emotions then the sellers suspect they are losing when they are a finalist.
• Have time on the calendar—don’t be in a rush.
• Not be distracted or weakened by the ERP seller's excuses and foot dragging on commercial terms. Ultimately the sellers would much prefer the ongoing revenue stream from the ERP buyer than not concede on eminently reasonable buyer terms.

Hang on to your chair, as we have a lot more coming on this topic.

ERP - Arguably the hardest commercial relationship to escape . . . So get it right at the start.

Information in these articles is based on the experience of over 1000 ERP projects conducted since
1996 in which the ERP buyer's interests and well-being was the sole focus.