There is a question every CIO learns to ask late, usually after asking it once at great expense: what happens to us in year seven, when the contract is up?
Year one is a honeymoon. Years two through five are delivery — workshops, integrations, go-lives, the slow accumulation of the vendor’s people in your building. Year six is when someone in finance notices what the platform actually costs per year, and asks what it would take to change. And year seven is when you discover the answer: more than you can afford, later than you can wait, and on terms you don’t control.
This is not a story about bad vendors. It is a story about a structure. When the platform belongs to someone else, every year you operate on it deepens the dependency — your processes shaped to its assumptions, your data in its formats, your staff trained on its console but not on its internals. The renewal negotiation is then held between one party that can walk away and one that cannot. Prices reflect that. They always have.
The three answers institutions give
Faced with year seven, institutions do one of three things. Most renew — from weakness, absorbing the increase, promising themselves an exit strategy next cycle. Some rebuild — a multi-year, multi-million programme that lands them on a different vendor’s version of the same structure. A few attempt the third answer, the only one that actually changes the game: they stop renting the core and start owning it.
Owning does not mean writing everything yourself — that is just year seven with extra steps, and your own staff as the vendor. Owning means the platform, the solutions on it, and the definitions they are generated from are your assets: running in your environment, extensible by your team, portable across infrastructure you choose.
What ownership has to include
The word “ownership” appears in many contracts and means little in most. For it to answer the year-seven question, four things must be true at once:
- A perpetual licence for what you deploy — the right to keep running everything, indefinitely, without a renewal event that can hold your operations hostage.
- The definitions, not just the binaries — the metadata your systems are generated from, versioned and readable, so the system can evolve without archaeology.
- The capability, in-house — staff certified to configure and extend the platform, with the vendor’s share of each cycle falling by design.
- Portability — the stack runs on open, mainstream technology, in your cloud or your data centre, so infrastructure is a choice and not a hostage.
Strike any one of these and year seven returns through the side door. Perpetual licence without capability means you own a system nobody can change. Capability without the definitions means your experts maintain a black box. Everything without portability means your asset lives in someone else’s building.
Ask it on day one
The uncomfortable truth is that the year-seven question cannot be answered in year six. By then the structure has set. It can only be answered in procurement — in the questions you score vendors on before anything is signed.
So ask it plainly, in writing, and grade the answers: When this contract ends, what do we keep? Who can change the system without you? What does it cost to leave — and have you ever helped a client do it?
A vendor whose model survives that question will answer it happily. Our answer is that you keep running the platform, because you already own it — and we would rather earn the next contract than hold the last one hostage.