Managing Quality Aspects in Application Management Service Contracts

Application Management Services  (also know as Application Outsourcing) has become a common strategy to hand over all maintenance and IT
operation tasks for an application or set of applications to an outside contractor aka "service provider". In many cases also near- and offshore resources will be involved to reduce overall cost.
During the preparation and execution of an application management contract both parties have a vital interest to define the boundary conditions and services of the collaboration, which is normally contracted for at least 3, in many cases also 5 or even more years, very precisely.
Besides the legal aspects of a contract the agreed scope and detailed services are the most critical topics for a successful collaboration over a long timespan. This includes in particular the detailed size and quality of the applications to be maintained and maybe also operated externally.

The lifespan of an application management contract in general comprises the following phases:
a) Defining the sourcing strategy and scoped of the planned outsourcing
b) Set up a tender process to collect bids from several potential providers ("Request for Proposal")
c) Short list the providers and enter negotiations with the last two or three         
d) Sign contract and conduct transition of assets, knowledge, etc.
e) Execute contract over the agreed life span
f) If at contract expiration time the contract is not renewed and a new provider is taking over, a reverse transition has to be conducted

What does this all have to do with quality aspects, in particular non-functional one?
Basically the client wants to guarantee that the provider does not corrupt the quality of the applications over (the long) time where it is under the regime of the provider.
The provider on the other hand has to make sure that he does not "buy a pig in a poke" and has to ensure that the application has got a least the quality that it is manageable within the estimated budgets.   
Therefore, during all phases listed above at least one of the contract partners has an interest in assessing and managing the overall quality of the application in scope:

- For the preparation of an outsourcing contract the client has to prepare an inventory of all application components (phases a, b)
- The potential contractors on the other hand would like to get an impression of the quality of the application to calculate their bid more precisely (phase c, d)
- Most contracts include a "due diligence" during the transition (phased) which allows the contractor to assess the quality again in detail and adjust his service fees respectively based on the results
- During the execution (phase e) of the contract the service level agreements normally include the periodic proof that the functional and non-functional quality of the application has not degraded         
- At contract expiration time, a final quality assessment is conducted to verify the quality when the responsibility of the provider ended 
In most case these requirements are covered by quality measurements of the software components and statistics from IT operations (like incidents, problems,etc.)

This includes non-functional metrics covering ISO 25000 quality categories and also productivity numbers based on function point calculations.
Together with statistics from ITIL-oriented IT operations both contract parties get an objective pictures of the application evolution over time, functionally and also for the non-functional aspects. 

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