# 7. How should enterprise GRC software pricing and three-year TCO be scored?

**Normalise the delivered scope before comparing price.** C10 should reward an affordable, transparent commitment—not merely the lowest subscription quotation.

Use the same user actions, entities, modules, data volumes, environments, integration scope and rollout assumptions across proposals. If one option needs a retained specialist tool, include its future cost rather than pretending consolidation is complete.

### Three-year GRC total cost of ownership checklist

| Cost category | Items to establish | Evidence to request |
|---|---|---|
| Software | Modules, licence categories, entities, environments, storage and volume commitments | Itemised order form and governing entitlement schedule |
| Integration and content | API access, connectors, middleware, regulatory content and source-system costs | Interface-by-interface inclusion schedule |
| External delivery | Discovery, design, configuration, migration, testing, training and programme management | Statement of work with assumptions, exclusions and change rates |
| Internal implementation | Process decisions, cleansing, architecture, security review, testing and training | Buyer-approved hours and loaded rates |
| Ongoing operations | Administration, integration support, releases, assurance, reporting and managed services | Operating model and support responsibilities |
| Transition | Legacy overlap, archive access, extraction and temporary support | Incumbent and replacement contract assumptions |
| Commercial change | Renewal increases, minimum commitments, expansion pricing and overage treatment | Agreed pricing mechanisms and notice provisions |
| Exit scenario | Export, assistance, reconstruction, overlap and contractual termination charges | Separately priced transition scenario |

The banking agencies’ guidance discusses clear cost schedules, conditions for cost changes and potentially burdensome upfront or termination fees. Those are useful contracting prompts; the model above is the desk’s proposed way to organise the buyer’s comparison. ([federalreserve.gov](https://www.federalreserve.gov/supervisionreg/srletters/SR2304.pdf))

### Use a transparent calculation

`Three-year economic TCO = external cash costs over 36 months + internal implementation labour + internal operating labour`

Show external cash spending and internal labour separately. Count each cost once. For example, do not add an administrator’s full allocated cost and also charge the same hours through individual tasks.

Include planned dual-running. Keep an optional exit at the end of year three separate unless the buyer actually intends or is contractually committed to exit then. Keep potential benefits separate from costs; released staff time is not automatically a payroll saving.

### Illustrative calculation—not a market price benchmark

| Assumed item | Calculation | Three-year cost |
|---|---|---:|
| Subscription | $150,000 × 3 years | $450,000 |
| External implementation | One-off assumption | $150,000 |
| Internal implementation | 800 hours × $75 | $60,000 |
| Ongoing administration | 60 hours/month × 36 months × $75 | $162,000 |
| Legacy overlap | Assumed total | $30,000 |
| **Illustrative economic TCO** | | **$852,000** |

This example assumes no subscription increases or additional connector, support or content charges. It is incomplete for a real purchase until those assumptions are confirmed.

**An unknown charge remains unknown, not zero.** Show a supplier-confirmed amount, a buyer assumption with an explicit range, or an unresolved item.

Build a downside case from buyer-selected events: additional contributors, delayed cutover, a required custom interface, more administration or an added entity. Do not present the downside case as a forecast probability unless the buyer has evidence for that probability.

For C10, agree the preferred budget and maximum acceptable downside exposure before opening final bids. A fully priced proposal within the ceiling can earn 3; a proposal needs the stronger budget, exposure and contractual conditions in the matrix to earn 5.