A Software Escrow release event is often perceived as an unlikely scenario. However, organisations across industries remain vulnerable to situations where Escrow release conditions are triggered.
Recently, we supported a financial institution’s business continuity plan when its software vendor, which they relied on for HR services, unexpectedly went into administration. Without a robust contingency plan, this could have resulted in significant disruptions to employee services. However, thanks to the swift proactive implementation of an Escrow as a Service (EaaS) Replicate Agreement, the financial institution was able to minimise the impact of this event, ensuring operations continued and business continuity was maintained.
Challenge
The financial institution used a cloud-based platform to manage essential employee services such as healthcare costs, well-being resources, and HR functions. Hosted on AWS and Microsoft Azure, this platform was integral to the institution’s HR operations. Any disruption could have led to serious operational and business consequences.
When the vendor failed to meet contractual obligations and subsequently went into administration, the financial institution needed access to the platform’s source code and other critical components to maintain operations. Without a backup plan, the vendor's failure could have severely disrupted internal HR processes, jeopardising business continuity.
Solution
In anticipation of such risks, the financial institution had partnered with Escode to implement an EaaS Replicate Agreement with the software vendor. This agreement provided a contingency plan for accessing and maintaining the platform in the event of vendor failure.
Our verification and validation process was crucial in ensuring that the escrowed materials – including source code, configuration files, and build reports – were up-to-date and ready for deployment in a mirrored cloud environment. This allowed the institution to transition smoothly from the vendor’s management to internal management of the platform.
The Release Process
The key steps involved in the process included:
The financial institution notified Escode, officially initiating the release event.
Escode informed the software vendor of the release event, initiating the process for releasing the escrowed materials.
Escode led daily meetings to ensure clear communication and resolve issues promptly.
Escode appointed a dedicated team of legal and technical experts to manage the release and ensure smooth execution.
After confirming that no disputes existed, Escode released the escrowed materials, which included the validated source code and necessary application components stored in the vault.
The financial institution successfully rebuilt and took over the platform's maintenance, ensuring that critical employee services continued without interruption.
Results
When the supplier failed to meet its contractual obligations, the financial institution successfully invoked the EaaS Replicate Agreement, accessing the necessary source code and build reports. With access to the necessary materials, the institution avoided disruptions to HR operations, ensuring employees retained access to essential services. This allowed the institution to transition platform maintenance in-house smoothly, by using the technical documents secured in our Virtual Vault.
As the independent Escrow provider, we coordinate with the vendor and appoint in-house experts throughout the release process. By conducting daily service-led meetings, we ensure effective communication, swiftly resolve issues, and manage the secure release of escrowed materials.
As businesses increasingly rely on third-party vendors to manage critical software applications, having a robust risk management strategy is essential. An escrow agreement serves as a safety net, ensuring organisations can continue operations in the event of vendor failure. By implementing the EaaS Replicate Agreement, the financial institution safeguarded its cloud-based application and ensured long-term business continuity.
To learn more about how Software Escrow can help protect your business, download the full case study.
