Tech & Sourcing @ Morgan Lewis

The leveraging of outsourcing engagements to implement and support digital transformation solutions is emerging as the foundation for the next generation of outsourcing. Digital transformation is a critical part of many companies’ strategic roadmap, seen as creating key opportunities for cost savings, efficiency, productivity and quality improvements, enhanced customer experience, and competitive advantages, including through state-of-the-art automation and data analytics. Many companies do not have the internal resources or skill sets to implement digital transformation at the required pace. This is leading to companies “leaning in” on their outsourcing providers to identify, design, and enable digital transformation solutions in a secure and compliant manner.

As noted in our recent blog, business process outsourcing (BPO) providers are promising big savings and improved outputs tied to the design and implementation of digital solutions that will monitor, quality check, facilitate, and sometimes perform the applicable business processes.

Gone are the days when a company could outsource the “people” that perform a business process without considering, and likely including in the outsourcing arrangement, the digital enablement of the underlying workflows and activities.

The rapid adoption of generative AI (gen AI) is driving increased cloud consumption.

In the case of the ownership of intellectual property (IP) developed by a supplier as part of a service agreement with a customer, should the traditional position that the customer should own all developed IP always be the position agreed upon by the parties?

In this blog post we explore build-operate-transfer (BOT) models in relation to businesses setting up offshore delivery centers, commonly becoming known as Global Capability Centers (GCCs).

Please join us on Wednesday, April 10, 2024 from 12:00–1:00 pm ET, as partners Kristin Hadgis and Don Shelkey and of counsel Eric Pennesi discuss the latest trends in commercial contracts negotiations, including negotiating artificial intelligence (AI) provisions and recent trends in privacy and security.

The European Central Bank (ECB) has published data showing that banks are increasingly using third-party providers to support their critical functions. However, more than 10% of outsourcing contracts covering critical functions are not compliant with the relevant regulations. During a key year for EU financial institutions and their critical service providers—with implementation projects for the Digital Operational Resilience Act (DORA) well underway—the ECB signals that outsourcing and resiliency, particularly risks associated with cloud outsourcing and concentration risks, will be a top priority on its supervisory agenda.

When the topic of technology commercialization strategies comes up, the most common options typically mentioned include the sale of a technology or building a business around technology by selling products or providing licenses or subscriptions to technology-based solutions.

The decision to terminate an agreement cannot be taken lightly. In exercising the option, understanding the key terms of the agreement and necessary steps to effectuate the termination are critical. As we have previously highlighted in past Contract Corners, termination provisions may include a variety of mechanisms built into them and one cannot assume that all termination provisions require the same steps to be taken. When considering a termination, a party must take the time to assess the actual termination rights under the agreement, what, if any, notice period will apply, and whether the termination will result in any payment or other obligations.