I spend a lot of time looking at the contract lifecycle. I have had numerous discussions (with some very smart people) about whether the lifecycle is a circular process, a linear one, a square, or something else. The truth is, it’s all of those. And none of those. Putting that (typical) lawyeriffic answer aside, it’s important to understand a few things about contract lifecycle management (or #CLM, if you speak hashtag).
Contracts are a cross-functional concern
Victory has a thousand fathers and defeat is an orphan. That saying is particularly true of contracts in 2018. Every function wants a say, but few will take responsibility for the full lifecycle. Legal, or procurement, are happy to take responsibility for the drafting, but what happens afterwards belongs to the black hole of “operations” or “the business,” to eventually land at the doorstep of the CPO, CFO or even the CIO. In reality, though, this is a team sport. All the more reason to treat it as such and include them in the discussion. The concept of cross-functional communication is still somewhat alien (even in 2018!) but the fact of the matter is, organizations that can master clear, concise communication across functions will come out on top.
To paraphrase, and increase the egalitarianism of his quote, Richard Branson once said that a machine can do the work of 50 people, but 50 machines can’t do the work of one extraordinary human. The point is clear: basic activities should be left to the machines. As I said at a recent IACCM conference, if your document retention system is “Bob”, then you are in trouble. But if Bob (or Linda) is a person with 30 years of experience who knows the market, then they are worth their weight in gold. Good CLM uses both tech and people in optimal ways; bad CLM gets things backwards. If you take Bob or Linda, with their 30 years’ experience, and make them data entry experts, you may be overpaying for the exercise.
Tools are great – when used correctly
I recently co-authored a report for the IACCM on CLM technology and automation (all of the points you like are mine, and the ones you don’t were, of course, made by someone else). The main thrust of the report is that there are a lot of technologies out there, but the best fit depends on your maturity level. Metaphorically, if you only know how to ride a bicycle, let’s not jump right into trans-Atlantic flight. I have a lot of conversations with companies who are still using “Bob” but want to know about blockchain, and I advise them to start simpler. There is massive return on investment to be had–if you know where to start.
Done right, CLM can generate massive ROI. But please, please talk to someone before jumping in head-first. Many companies will try to sell you just tech, or just people, or something else alone. But what’s really needed is a well-tuned mix. That’s the secret to success. The first step is to figure out what works for you. When you get the mix right, that’s when you’ll really see the results.