Many vendors use certain practices that give them short-term advantages or lower prices, but with long-term negative consequences to you, the client. Make sure you investigate your vendor's approach to these topics, and avoid falling into these common traps.

Who owns the source code?

The source code is the actual program, or lines of instruction, in an unencrypted format. Many vendors keep the source files and hold the copyright to them, which prevents you, the client, from making changes to the program on your own. Retaining the source code gives the vendor tremendous power over the client. If you are dissatisfied in the middle of the project, you can not fire the vendor without being willing to start the project all over from scratch. More commonly, when you return to the vendor in the future for minor updates to the program, you may discover that exorbitant rates will be charged for the updates. Without ownership of source code, you have no choice but to pay the high fees - it is still cheaper than creating the program again from the beginning.

Make it clear in your RFP or contract that all unencrypted source files and programmer notes will be turned over to you and you have the right to maintain the program yourself in the future. Many vendors intentionally encrypt their work to prevent others from accessing it.

Who owns the content?

Ownership of the content itself is as important as the source code. If the vendor holds exclusive copyright to the words, images, and videos that appear in your program, then only that vendor has the legal authority to change the content, or reuse it in a modified program.

Most vendors have a legitimate need to protect their "intellectual property" and need to be able to reuse part of the content on other projects. As the client, however, you need to make sure that you have the right to use, modify, and re-use the content for your internal purposes.

Are project expenses extra?

Some vendors bundle all expenses into the project fee, while others bill for individual items. Just be sure you know in advance how your vendor operates. Vendors can charge for photocopies, phone calls, postage, faxes, office supplies, administrative assistance, and travel. These fees add an additional 5 to 15 percent to a project total. If your vendor charges for expenses, make sure to get an detailed list of which items will be charged, find out the exact cost per item, and insist on receiving all receipts or detailed records of materials used.

What will program updates cost in the future?

If you own the copyright to the source code and content you are likely to get competitive rates for time and materials since you can always turn to another vendor. Never accept flat fees or percentage fees for changes. For example, some vendors will charge $2,500 plus $1,000 per day for changes. If you sign such an agreement you could pay $3,500 for the vendor to make a simple text change that might only require an hour of time. The best deal is for the vendor to charge normal hourly rates ($100 to $150) and expenses for any future updates.

Is the vendor using a "black box," "engine," or proprietary tools?

A software engine, sometimes called a black box, is a program that automatically processes content such as data stored in a separate database. For example, an engine might specify where to place text on a screen, and where exactly to place a photograph. Because an engine is built once, and the content is easily added or changed, a large amount of multimedia training can be developed for a relatively low cost. Typically, however, engines result in linear "page turners" where each page looks the same and there is little interactivity or room for creativity. Many vendors consider their engine to be proprietary technology and refuse to turn it over to their clients.

Similarly, many vendors have created proprietary development languages or models that enable them to reduce the time and cost of program development. While this may cut development time for the vendor, it also means that you, the client, will have to always return to the same company for future updates and changes, even if you are dissatisfied with the prices or service.

Never agree to having your training produced using proprietary programs of any type. You will be forever shackled to the vendor who may or may not even be in business two or three years from now when you need changes. Your initial investment becomes worthless if it needs to be updated and cannot be altered.

Today there are many excellent, easy-to-use tools on the market that are common among all vendors. Insist that your vendor use a standard authoring language such as Authorware, Director, Toolbook, IconAuthor, or Quest.

Is the vendor using freelance developers?

It is easy for a vendor company to present themselves as being capable of all services - video, audio, multimedia, instructional design, Web development. Whatever it is you want, they do it. The truth often is that the company offers these services but do not have in-house capabilities in each particular area. Instead, they go outside the company to a freelancer.

While there is nothing wrong in theory with using freelancers, there are some pitfalls to be aware of. Freelancers can help keep costs down and bring specialized expertise to a particular job. But freelancers present a risk to you, the client. When a company uses freelancers, you really do not know who is working on your project. Neither the vendor company nor you are in control of the freelance individual. What happens if the person becomes ill, moves away, or takes a job? Always make sure you ask in the RFP or follow-up meetings for the vendor to specify the exact team that will be working on your project and to tell you which ones are full-time employees and which are employed on a freelance or contract basis.