Blog


As the leading provider of contract management software powered by the Office 365 and SharePoint platforms, we seek active engagement in any dialogue related to the contract management industry or our technology platform.  "This Week In Contract Management," our newest blog series, offers insight and commentary on all of the latest industry news and trends in contract management.  From the significance of contract management as a C-Level initiative to latest industry news, trends and consideration for implementing a contract management software application, we're happy to share and invite you to join in the conversation!
Contract Management Software Blog - This Week in Contract Management | Legal Applications of Knowledge Management
This Week in Contract Management | Legal Applications of Knowledge Management, 06.16.2016

 

Post by Rob Lunder, Marketing Manager, Corridor Company

Hello again!  Thank you for joining us for the newest edition of This Week in Contract Management.  I came across a thought provoking article regarding Knowledge Management (KM) that warranted attention. 

Familiarity with the concept of Knowledge Management is mixed.  Given its name, a variety of generalities can be assumed.  However, when considered in the context of the software world, it becomes less concrete.  There are those out there who are familiar – and, of Earth Wire.jpgcourse, those who are not. And, I'm sure you're asking – what does this have to do with Contract Management?  Well, allow me to explain. 

In terms of understanding Knowledge Management, let's take a step back.  Michael E. D. Koening, a frequent contributor to KMWorld and a current Professor and former founding Dean of the College of Information and Computer Sciences at Long Island University, defines Knowledge Management as "the process of capturing, distributing, and effectively using knowledge.  Knowledge Management is a discipline that promotes an integrated approach to identifying, capturing, evaluating, retrieving, and sharing all of an enterprise's information assets.  These assets may include databases, documents, policies, procedures, and previously un-captured expertise and experience in individual workers."  Lisa Quast, a career coach and frequent contributor to Forbes Magazine, adds three reasons why Knowledge Management is so important in today's business world:

  • Facilitating Decision-Making Capabilities
  • Makes Learning Routine
  • Stimulates Cultural Change and Innovation

When considered in the legal industry, one rich with the need to retain information assets, Knowledge Management, and specifically, Knowledge Management software, have not been embraced as rapidly as the KM world would like.  However, there is hope – this trend is changing.  In the article that I've referenced above, Research Analyst and Senior Writer, Judith Lamont of KMWorld, the leading publisher, conference organizer, and information provider serving the Knowledge Management, content management, and document management markets, provides thoughtful commentary on how and why there is increased adoption of KM technologies within law firms.

Says Lamont, "Knowledge Management software solutions tailored to the legal profession are becoming more common and lawyers more receptive to them."  She adds, "Even though the legal field is a knowledge-based business, lawyers have not been early adopters of KM technology.  Like many other groups of users, only more so, they have little patience with systems that do not match their way of working.  The requirement to enter metadata, profile documents or adapt to a new way of classifying and storing documents generally results in non-compliance and a wasted investment."  Which is to say – if it isn't intuitive, easy and doesn't help me to do my job – I'm probably not going to use it.

The transition begs the obvious question – what has changed or is changing that is positively impacting user adoption? If you're a KM vendor, you are, of course, happy with this transformation; however, you want to specifically understand what is happening so that you can further leverage this to increase your footprint.  As a company that utilizes elements of Knowledge Management within our own contract management software application, we, as well as our client champions, also want to know. I would suspect that if Knowledge Management is important to your organization, you too may find the answer interesting. 

The answer is not that there is some new organizational mandate which requires use of the technology – or new study which espouses its many benefits - though, let's face it, both would be helpful.  The answer is much simpler.  The software is easier to implement and it's easier to use.  I, as an end user, can readily understand the technology, use it, and can leverage it to be more efficient.

Case in point: MetaJure, a leading Document Management System based in Seattle, Washington, is a benefactor of this increased adoption. Lamont, in her article, interviews James Kosa, a partner with Deeth Williams Wall, a Toronto-based law firm specializing in intellectual property and technology, who recently implemented MetaJure's technology. Kosa states, "Prior to Metajure, we had a hard time finding our documents and supporting information.  While we store everything in a centralized file structure, it is still difficult to find things.  This is a problem for us and our clients.  With Metajure, however, important information can be readily located and leveraged by our entire team.  A simple search provides direct access to the information in question.  Similar technologies including Sherpa Technologies and Cloud Nine are experiencing comparable increases in user adoption – for the same reasons."

We, as a contract management vendor, apply various aspects of KM to our approach to storing and finding documents.  And, like Metajure and similar companies, we have a keen eye on making things easier for both the administrators of our system as well as our end users.  We would argue – convincingly or not – that our problem is even more complex as we tackle not only the storing and finding of information, but also automating various aspects of the contract management process including contract creation, approval, overall management and reporting. 

Gartner's analysis of the legal industry in the context of contract management suggests the following challenges:

  • An increase in global velocity requiring faster execution of the contracting process
  • Increased demands on governance, risk, and compliance management
  • Digitization of paper contracts, embracing e-signature
  • Companies expansion into new markets (including merger and acquisition activity)
  • Increase personalization of customer requirements

So, how are we making things easier for our administrators and end users?  Glad you asked!  By providing an easy-to-use contract request wizard, all pertinent contract information can be collected to enable metadata searching and to introduce an intuitive contract document hierarchy.  Landing pages are configured to be clean, intuitive, to offer only the information necessary, and to be "audienced" for specific user types.  Contract templates can be easily identified and the creation of contracts can be automated based on a variety of different factors. Standardized clause playbooks can be introduced and these clauses, along with the templates can be rated to determine higher usage trends.  Support for the efficient exchange of contract redlines between your organization and your counterparty aid in negotiation efficiency. Contract approvals are routed directly based on unique identifiers important to specific organizations and can be quickly processed via handhelds and other devices.  Signature processes can take place fluidly through the use of e-signature. Obligations can be readily added to the system, scheduled, and escalated when necessary.  And, reports which capture wide ranges of information important to various aspects of an organization can be scheduled to be delivered directly to the inboxes of those who need to know.

Additional initiatives are also taking place within the industry including contract categorization so that contract information can be more readily mined to better understand exposed legal positions and actions which must be taken. Companies such as Brightleaf, Seal Software, Legal Sifter and Raven are taking this a step further as they leverage artificial intelligence to automatically identify important contract information.

So, what's the lesson?

Today's business world is fast paced – and only getting faster.  The demands placed on resources continue to grow – providing an ample opportunity for technology to be leveraged for increased efficiency.  Key to the technology's adoption is its ease of use – not for the individuals assessing the ROI of the application or its management benefits, but rather for those who actually use the system.  Whether it's retaining organizational knowledge or properly managing contracts – to be successfully embraced by the end users – the technology must readily integrate into their way of working and to provide tangible productivity benefits.

Rob writes on contract management and business applications for Corridor Company.

Read More
Contract Management Software Blog - This Week In Contract Management | Buy-Side, Sell-Side And Other Contract Types
This Week In Contract Management | Buy-Side, Sell-Side And Other Contract Types, 06.10.2016

 

​Post by Rob Lunder, Marketing Manager, Corridor Company

Hello Everyone!  Thanks for tuning in again to This Week in Contract Management  As you may or may not be aware, we host a monthly webinar series where our CEO and President, Russ Edelman, analyzes current industry issues and best practices, as well as the role cContract Pen to Paper.jpgontract management plays in allowing organizations to identify and address immediate operational inefficiencies.  The focus of our most recent webinar, Contract Management | Buy-Side, Sell-Side & More, was the commonalities of Buy-Side, Sell-Side and other contract types and how they can harmoniously exist in a single managed repository. 

In this session, we explored the crucial differences between Buy-Side, Sell-Side and other contract types with a specific focus on four key areas: contract information management, processes employed, people impacted and common integration touch points.  After our sessions, we make all slides available to registrant; however, given the importance of this topic, we thought it prudent to discuss to topic in our weekly blog.

In setting the stage, did you know - according to a recent survey conducted by the IACCM, the International Association for Commercial and Contract Management, that only 40% of current IACCM members handle both Buy-Side and Sell-Side negotiations and contracts?  Gartner also recently conducted a survey with Contract Lifecycle Management companies where they asked these companies to break down the contract types used by their customers.  More than half of companies surveyed stated they only use their CLM system to manage their Buy-Side contracts.  Only 21% stated that they use their CLM platform to manage both Buy-Side and Sell-Side contracts.  Given the benefits and economies of scale which can be realized in managing both contract types in one system, these figures are troubling.

As we all know, Contract Lifecycle Management Software streamlines contract management with fully automated document generation, automated reporting, contract approvals, electronic signature integration and automated alerting of contract expirations, renewals, and pending obligations.  A well-designed CLM system possesses the capabilities to manage Buy-Side, Sell-Side, and other contract types in a single repository.  This saves a tremendous amount of time and expense, and provides full visibility into business relationships.

Before we delve deeper, let's baseline on the definitions of Buy-Side and Sell-Side contracts.  Buy-Side contracts are agreements where a buyer agrees to acquire goods or services from a seller in exchange for a consideration.  Within the world of contract management, the people most often managing your Buy-Side contracts are your Procurement teams - the people within your organization who drive both the RFP (Request for Proposal) and RFQ (Request for Quote) processes, as well as contract negotiations and contract spend.  They require immediate access to contracts in order to negotiate the best possible price with vendors, re-negotiate price with current vendors, and manage the total spend for their respective organization.  Their role is integral to identifying the lowest possible cost, in recognizing potential price discounts within their contracts, and ensuring that the goods and services procured are delivered in line with agreed contract terms.

Sell-Side contracts are agreements between a buyer and a seller for the sale and delivery of goods, services, securities and other personal property.  Sales teams are most often involved with the negotiation of Sell-Side contracts as they look to close new or additional business for their organizations. They require immediate access to contract templates, approved language provisions, and existing contract information so that they can readily sell new or additional goods and services.  Additional contract types which were discussed include distribution and partner contracts, employment, sponsor, real estate, and licensing contracts.

So, why house all of these contracts in a single application? Glad you asked! Contract Lifecycle Management Systems support your entire contract lifecycle.  And, well-designed, flexible Contract Lifecycle Management Systems support numerous different contract types – from Buy Side to Sell Side to the employment, real estate and distribution agreements noted above. A well-designed Contract Lifecycle Management System should have the capability to house all of these contract types, as well as improving functionality in reporting, compliance and document retention.  When contemplating how to best approach what we'll refer to as co-tenancy, it's important to consider the following key commonalities:

  • Information
  • Processes
  • People
  • Systems

The information – or in the land of contracts, metadata – involved within each contract type is consistent throughout the entire contract lifecycle. Metadata that you will regularly find in these contracts include contract number, contract effective date, contract execution date, contract termination date and counterparty type.  Supporting documents such as addenda and appendices are found in each contract, as well as supporting data such as contract obligations and provisions.  Given that the metadata is the same within each contract type, doesn't it make sense to store all of your contracts within the same operating system? 

Contract request processes are another consideration that is constant within each type of contract.  Each contract requires business, legal, and financial approval.  Are you going to negotiate and sign a contract without the review and approval of your organization's leadership team?  Of course not.  The proper legal review of your contracts ensures that your agreements comply with industry guidelines and regulations.  Financial review is required in order to adhere to your company's authorization on contract spend.  While spend thresholds and certain language provisions may require elevated approvals, the general review and approval processes for Buy-Side, Sell-Side and other contract types are consistent within any organization.

The people managing and facilitating the contract management process are also consistent for each contract.  A global administration team is often front and center, as well as the legal department's review of contract templates, drafting, and negotiating contracts.  Your organization's IT department will also be involved in supporting the application as their role is vital in installing, configuring, and supporting all technical features.  If the same individuals are involved in managing each contract, doesn't it make sense to implement a system where all contracts are grouped within one repository?

Last, the systems which integrate into your contract management application – whether upstream or downstream – are likely consistent across contract types.  For example, systems such as SAP may feed customer master data for your Sell-Side contracts as well as vendor master data for your Buy-Side contracts into your contract management system.  Alternatively, your contract management system may initiate the creation of counter party records or invoice creation in a downstream system – again, for both contract types. This integration can be leveraged across all contract types for reduced overhead and administration.

As you contemplate your CLM system, we hope that this has been helpful. While each contract type is unique, their similarities and the economies of scale that can be realized by managing them within a single system suggests that the best course of action is to do just that –  manage these within one single system.

As noted above, we do host these sessions monthly, and I would be remiss not to invite you to our next session: Planning a Contract Management Roadmap | A Safe and Successful Road Trip, on Wednesday, June 22, 2016, 11:00 am EDT.  Please join us as we highlight the following:

  • Client Readiness and Contract Maturity Goals
  • Implementation Considerations
  • Delivery Considerations
  • Internal and External Participants and Responsibilities
  • Ensuring the Success of your Constituents
  • ROI Justification

Rob writes on contract management and business applications for Corridor Company. 

Read More
Contract Management Software Blog - This Week In Contract Management | Understanding Your Competitive Advantage
This Week In Contract Management | Understanding Your Competitive Advantage, 05.06.2016

 

​Post by Rob Lunder, Marketing Manager, Corridor Company

Understanding your company's competitive advantage or advantages is critical in today's fast moving economy.  When one contemplates competitive advantage, they do so in the context of greater sales or improved margins.  Rarely does one consider how your contract management processes can contribute to your company's competitive advantage from a sales perspective. And while contract managDollars-Pricing-iStock_000003257324Small.jpgement extends across all contract types, the focus of this post is all about sales contracts and the impact that they have on your business.  Consider this: IACCM, the International Association for Contract and Commercial Management, cites that almost 10% of gross revenue is lost on poor contracting processes.  For the disbelievers out there, cut this figure in half, and if you feel compelled, cut it in half again.  The impact to both your top and bottom line is staggering.

IACCM also notes that contract automation can accelerate negotiation cycles by 50%, reduce erroneous payments by 75 to 90%, and cut operating and processing costs associated with managing contracts by 10 to 30%.  Given that contracts are the vehicle by which we all do business, improving efficiencies in this area is something to seriously consider. 

For those unfamiliar with the topic or Contract Lifecycle Management (CLM) software, it is a solution which addresses all aspects of a contract's lifecycle – including contract creation, contract negotiation, contract signature and compliance and obligation management as well as reporting, alerting, and escalations.  With proper contract management processes and automation solutions in place, sales teams can close deals faster, contract opportunities can be readily identified and pursued, and what has become the strategic tasks of managing your contracts can take place automatically and with more efficiency. 

Close Deals Faster

The process of having a customer select you, beating out your competition and ensuring that the deal actually closes - as opposed to the dreaded no decision - is a significant challenge.  Adding internal inefficiencies around your contract process is an unnecessary addition to an already arduous process.  You need not provide your competition with even the smallest opportunity to derail your deal.  

A system which provides automated contract assembly and pre-approved templates can reduce your sales cycle substantially.  The ability to source fall back language provisions which have already been approved by management and to track where and with whom the contract is in the approval cycle also contributes to a more efficient and effective sales cycle. Further improvements can be made to this process through the use of electronic signature.  This single improvement alone can significantly impact deal closure time – both internally and for your customer.  According to Bryan Ball, a Research Director for the Aberdeen Group, a technology research and analysis leader, "The task of tracking down and securing necessary signatures causes delays with the contract management process.  'V' and 'C-level' approval or authorization is often required before execution can begin." Delivering a contract to an executive's inbox with concise signature directions and a simple click and point interface is far more efficient than printing a contract, scheduling time or tracking down the appropriate executive for signature, scanning and filing the contract, electronically or otherwise.

A key element to closing deals faster and to ensuring that your sales team leverages the efficiencies made available to them through a CLM system is to provide this functionality where they "live".  Sales teams tend to live in their CRM systems – Salesforce.com being a prime and perhaps a leading example of a CRM system.  IACCM notes that "Those who leverage an integrated holistic sales automation platform consisting of CRM and contract management rated their capabilities higher than their counterparts who leverage stand-alone contract management solutions.  The key observation from these results is that contract management automation solutions that integrate with broader sales automation tools allow superior levels of empowerment and visibility, removing many inter-functional frustrations and enabling the growth of collaboration between those on whom sales success depends."

We've all faced end of quarter crunch – it's critical to have a system which facilitates efficient deal closure.  Cash can be collected more quickly, revenue can be recognized faster, and overall performance can be improved.

Readily Identify Opportunities

Whether you are a buyer or seller, a CLM system can be leveraged to identify new opportunities.  On the sales side, opportunities present themselves in the form of product upsell, solution expansion, met performance guarantees, and contractually agreed to price increases.  Closure of the initial client engagement – prior to the establishment of a trusted relationship – is generally far more challenging than contracting additional opportunities downstream.  Given the investment made into these initial activities, downstream opportunity follow up and footprint expansion are straightforward strategies for attaining sales goals.  With inevitable organizational change, it is critical to keep site of this organizational knowledge and opportunity.  Contract dashboards readily lend themselves to a full 360 degree review of clients from a contract, solution, renewal and obligation perspective. 

On the buy side, such opportunities exist in the form of leveraged buying and volume discounts, pro-active renewals or terminations, and assurances that you are, in fact, receiving what you've contracted the other party to deliver within the time frames and quality parameters promised. A tremendous amount of time and effort were likely expended to negotiate these terms and conditions into your contracts.  It's of critical importance to ensure that your organization is receiving the benefit of these investments. 

Obligation management, a key element of robust CLM systems, paired with the proper alerting, reporting and escalation mechanisms allows these opportunities to be identified, quantified, and managed to resolution.  On the buy side – and also the sell side – these systems can be paired with a variety of back end systems including financial systems to also accurately monitor and manage contract spend.

Manage More Effectively and Efficiently

A CLM system, properly implemented and managed – can have a significant impact on your company's margins.  From a top line perspective, the strategies noted above directly impact revenue generation.  From a bottom line perspective, introducing process efficiencies also provides material impact.  With a CLM system, the right resource can focus on the right problem – and do so efficiently.  Highly paid legal counsel no longer be employed for less strategic purposes, sales processes can proceed more efficiently and the contract management team has easy access to all of the resources necessary to effectively manage their contracts.   Effective contract management processes directly contribute to both greater sales and improved margins – and directly contribute to your competitive advantage.

Next Week's Blog

Join us as we examine the role Knowledge Management Software has in the legal industry, with a specific focus and relation to contract management.  See you next week! 

Rob writes on contract management and business applications for Corridor Company.

Read More
Contract Management Software Blog - This Week In Contract Management | Crossing the Pond | Key Conclusions from Legal Leadership in EMEA
This Week In Contract Management | Crossing the Pond | Key Conclusions from Legal Leadership in EMEA, 04.29.2016

 

Post by Rob Lunder, Marketing Manager, Corridor Company

The legal landscape in EMEA - Europe, the Middle East and Africa – is as wide and diverse as the region.  Doing business in this area requires an awareness of not only the various regulations, but also of their ongoing changes.  

With an interest in validating our current knowledge of these legal markets and keeping abreast of the latest trends and challenges in contract management, Corridor Company headed to London to attend the Corporate Counsel Exchange 2016.  For those not faIMG_1445.JPGmiliar with the Corporate Counsel Exchange, it is a global collaborative network of legal experts who provide news and thought leadership on the latest global challenges and opportunities in navigating the regulatory landscape, transforming legal department management.  The organization also delivers real value in an increasingly complex and competitive global marketplace. Hosted by the IQPC, International Quality & Productivity Center, the Exchange featured numerous prominent speakers in the divisions of both corporate governance as well as compliance.  It was an exciting journey for us - not only were we able to meet with compliance and legal executives from across the globe - we also participated in roundtable discussions focusing on the art of doing business in the EMEA from a legal and regulatory perspective.  In our This Week in Contract Management blog, I'm happy to share our key takeaways and conclusions from our sessions.  More specifically, we'll review the following three topics as discussed by legal leadership in EMEA. 

  • Lack of Innovation in Legal Industry
  • Business Ethics Awareness
  • Identifying and Managing Risk

Lack of Innovation in Legal Industry

One of the key principles of Corridor Company is to challenge status quo and to operate with an innovative mindset. Given our focus in contract management automation and leveraging technology to solve legal business challenges, we were particularly interested in the session, "Working With Us, Not For Us". The discussion was led by an esteemed panel which included:

As the discussion began, the immediate focus centered on a lack of innovation within current EMEA legal firms.  Ellis, a key figure on Abercrombie & Kent's legal team, noted that in today's business environment, current and perspective business partners no longer value the standard and general approach when conducting business.  They now place greater importance on partners who can deliver the most innovative solutions. Innovation should be a key value proposition for firms in these regions, but it is an area that is not being maximized to its full potential.   Tellman, Pearson's General Counsel, says that in the legal industry, business partners think about innovation in a very narrow-minded way.  He juxtaposed the legal industry to the accounting industry, a field that has grasped the concept of innovation and has applied it to its day to day business practices.  Accounting firms have become a full service industry, developing their insight and expertise in providing consulting services and tech support.  He questioned and encouraged the legal field to follow a similar trajectory. 

Business Ethics: The Short Cut Guide to Business Ethics Awareness

Robbie O'Brien, a speaker at the conference and CEO of MetaCompliance, a London based firm providing policy management software, says that bribery has cost the European economy £99 Billion.  That is not a misread.  £99 Billion!  The BBC states, "64% of British respondents said they believed corruption to be widespread in the UK, while the EU average was 74% on that question."  The broadcasting company further adds, "Organized crime groups have sophisticated networks across Europe. The EU police agency Europol says there are at least 3,000 of them."  

It was both surprising and concerning to learn how pervasive corruption is throughout these regions.   Bribery is often viewed as essential for business survival, and companies must navigate these controversial waters when conducting business.  A code of ethics should be the identity of any organization, but to do business in this region requires flexibility in this historically rigid area.  This presents various complications for disclosure and compliance.  How can we be successful as an organization if we are not in compliance with industry regulations? 

Identifying and Managing Risk

Throughout the show, one theme was frequently discussed: identifying and managing risk.  The topic was further discussed among a distinguished panel, including:

The group stressed just how important mitigating risk is to the success of any business.  All four members stressed the rise of risk management as an ongoing business issue, and noted that preventing it requires a long term vision.  Companies need to have an open line of communication to ensure that key deliverables and initiatives are met on time, and are completed in an appropriate and professional manner.  And, for those situations when a deliverable is missed, organizations need to understand the "What If?"  What if we miss a key date or essential legal terms in a contract?  All four speakers stressed the importance of accepting the "What If" philosophy when conducting business.

As we prepared for our trip home, we contemplated the information presented to us.  EMEA is a prime region to explore business opportunities – not only for us as a contract management software provider, but also for all global companies.  Jason Popp, Executive Vice President of International at GES and a frequent contributor to many global business journals, suggests focusing on EMEA. "One reason" says Popp, "is location".  "The Middle East, after all, is conveniently tucked between Europe, Asia and Africa.  Factors such as an expanding middle class and urbanization are spurring consumer spending, and governments are promoting certain areas of the economy.  Rules and laws are favorable to businesses.  In Dubai for instance, there's a customs-free corridor between the airport and the port, meaning raw materials can be imported and exported free of charge." 

As we at Corridor Company consider not only our expanding global footprint, but also our product roadmap, it was extremely helpful for us to have attended these sessions.  We left the Exchange better informed with a variety of ideas on how to augment our product footprint and methodology to better address these legal challenges.

Next Week's Blog

In next week's blog, we identify the many ways a well-run contract management system can provide a competitive advantage for your business.  Stay tuned for next week!

Rob writes on contract management and business applications for Corridor Company.

Read More
Contract Management Software Blog - This Week in Contract Management | West Australian Health Worker Overspends by Millions on IT Contract
This Week in Contract Management | West Australian Health Worker Overspends by Millions on IT Contract, 04.18.2016

 

Post by Rob Lunder, Marketing Manager, Corridor Company

Thank you for joining us for This Week in Contract Management.  Did you happen to see the article about the West Australian Health Department official who overspent on an IT contract in excess of $40 million?  That is not a typo folks.  $40 million!  Can you imagine walking down the hallway of your office to tell your supervisor that your mismanagement of a contract will cost your company an additional $40 million?  Good luck with that conversation. 

Contract Management has become a huge priority in today's dynamics of corporate management.  According to Gartner, the leader inWestern Australia Picture.jpg technology research, Contract Lifecycle Management is no longer a "nice to have" initiative, but rather a "need to have" business practice.  With a direct impact on both revenue and expenses, as well as the risk profile of a company, many businesses have an elevated interest in implementing automated solutions.

More pointedly, Contract Management has become a C-Level initiative for business executives worldwide.  Case in point is the mismanagement of this IT contract by the Western Australian Department of Health.  Key to this catastrophe was the failure by the contract manager and management team to review the contract and ensure it was being managed appropriately. Important provisions were not flagged for management, spending was not tracked, and the appropriate alerting, approvals and escalations were not put in place to ensure that actions were completed, as requested, on schedule, and within identified spending parameters. While this all seems obvious, it is a not so uncommon error in contract management. 

Says WAtoday, who broke this story, "Acting auditor-general Glen Clarke found a series of irregularities and weaknesses in the contract's management resulting in millions of wasted taxpayer dollars, including the health department paying $90,000 per month to store $3.3 million worth of unused IT equipment."  While the story doesn't specify the length of time that this storage took place, it's safe to say that this spending process should have been monitored with a much stronger attention to detail.

So what happened here?  Where was the breakdown in the contract management process and how could this have been mitigated?

Tim Cummins, President and CEO of the IACCM, also known as the International Association for Contract and Commercial Management, references in his blog "Commitment Matters" just how important Contract Managers are in the accurate management of an organization's contracts.  "Contract Managers serve as the point of contact for customers on contractual matters.  They act as the contractual 'middleman' between company employees and customers, ensuring timely review and approval/reconciliation of variations." 

The NCMA, commonly known as the National Contract Management Association, in their February, 2016 journal of "Contract Management-Voice of the Professional Contract Management Community", further supports the importance of effective contract management in overseeing the entire contract lifecycle.  Says Dr. Rene Rendon, a contributor to the NCMA and an authority in supply, contract, and project management, "The contract manager should be among the first to identify external risks to the integrity of his or her organization and should be empowered to act and to deal with these situations appropriately."

Perhaps this contract manager was tasked with managing too many contracts?  Or perhaps he or she was unaware of the key terms and provisions of the contracts? In any case, the use of a contract lifecycle management application would have prevented this gross contract mismanagement.  Contract management software, among its many unique capabilities, ensures that the contract manager and other business users have proper visibility into all of their contracts and have the tools necessary to foresee potential problem areas before they ever come to fruition.  More specifically, the contract itself, should have been stored in a central repository with key contract details readily accessible to those responsible for the management of the contract.  Line of business integration into a procurement system could have taken place to more closely monitor contract spending.  Automated workflows should have alerted the necessary management figures that their approval was necessary for certain spending thresholds.  Alerting should have taken place when these approvals were not received or the thresholds were reached.  Any actions which were required by the contract manager or counter party should have been logged into this system for the appropriate follow up, completion and audit compliance.

Contract Management requires proper resource allocation within any organization. This resource allocation includes not only people, but the supporting processes and technology to make them successful.  The failure to properly allocate these resources and manage them throughout the contract lifecycle process results in revenue loss, unnecessary spending, damaged credibility, and legal and compliance issues. 

Next Week's Blog

Get ready for next week!  Corridor Company is committed to constantly being up to date and on top of industry trends.  Join us as we attend a conference focused on compliance and industry regulations.  I will provide key take away points from the conference and how you can use these practices and recommendations in the day to day management of your contracts.

Rob writes on contract management and business applications for Corridor Company.

 

 


 

Read More
Contract Management Software Blog - This Week In Contract Management | Ten Pitfalls of Current Contracting and Commercial Practice
This Week In Contract Management | Ten Pitfalls of Current Contracting and Commercial Practice, 04.14.2016

 

​Post by Rob Lunder, Marketing Manager, Corridor Company

Nice to see you again!  Thanks for joining me for the second of my two part series where I reflect on the information shared by Mr. Tim Cummins, President and CEO of the IACCM, at our recent chapter meeting. 

For those just joining now, IACCM, also known as the International AssociatioBlog 2 picture.jpgn for Commercial and Contract Management, is the pre-eminent best practices organization in the contract management space.  In addition to being an industry pundit, their esteemed leader, Mr. Tim Cummins, is one of the most innovative and thought provoking speakers I've had the good fortune of meeting. 

During his presentation, he highlighted the ten key areas where companies have the most difficulty in managing their contracts.  Throughout this week's blog, I've taken the opportunity to review these pitfalls in the context of our product, Contract Management [.app]TM for SharePoint.  Given the depth and complexity of some of the pitfalls, I have taken the liberty of combining, and/or re ordering a few of these for ease of discussion.

Pitfall 1: Lack of Clarity and Scope on Goals

Do you make a list of goals that you hope to accomplish throughout your day? How often do you benchmark your progress against your goals?  According to the Wall Street Journal, goals should be both implemented and monitored within an organization to ensure progress.  The only way a goal can be achieved is if everyone clearly understands and seeks to accomplish the same objective. 

In the realm of contract management, different organizations have different goals.  Often, these goals are directly related to where an organization may be in its contract maturity.  For those with newly implemented processes and tools, focus may be on quickly locating a contract, understanding its key terms and provisions, and knowing when the contract should be renewed.  For those with more mature processes, goals may include reduced contract cycle time, increased contract revenue, or reduced contract expenses.

Regardless of your organizational goals or where your organization is in its contract maturity, Corridor's Contract Management application, CM[.app], in conjunction with our Business Release Implementation Methodology, supports the measurement and realization of such goals. From storing a contract in a central repository with the appropriate metadata tags to sophisticated graphing, charting and reporting capabilities, CM[.app] allows organizations to achieve and measure stated objectives.

Pitfall 2: Legal & Contract Teams Not Involved Early Enough

Attorneys, General Counsels and Contract Managers are imperative in a well-run contract management process. Their input and review is essential in guaranteeing that an organization is in compliance with the legal terms outlined in a contract.  Because these resources are often in high demand and difficult to schedule, they tend to not be involved in the process until much later.

With an automated contract lifecycle management application, this risk can be reduced.  For less complex contracts, self-service templates with pre-approved language and fall back provisions – created in advance by your legal teams – can be made available to those who need them. For more complex contracts, a well-supported negotiation process with automatic redlining, version control and alerting facilitates more efficient contract completion.  In both cases, the functionality provided by a CLM application supports a more active and efficient engagement by your legal team.  

Pitfall 3: Failure to Engage Stakeholders

When stakeholders are not involved in the contract management process, there are a variety of negative downstream effects - lack of visibility into contract status, an inefficient or misguided approval process, unnecessary revision cycles, risky language provisions and missed deadlines.

Leveraging an application such as CM[.app] allows these issues to be avoided.  Contract status can be tracked directly through our Tracker or through email and system alerts. Basic, complex and unique workflows can be used to ensure that all appropriate approvals are gained. Language fall back provisions can also be pre-approved and made available to those negotiating the contract. This will prevent unnecessary revision cycles from taking place and risky language provisions will not be included in the contract without the appropriate approvals.  Stakeholder participation can be facilitated to ensure the efficient and effective completion of contracts within stated deadlines.

Pitfall 4: Protracted Negotiations

Revenue cannot be recognized and cash cannot be collected until the contract has been signed and product or services delivery has begun.  Protracted negotiations not only impact deal closure, they potentially compromise the deal as the counterparty has the time, opportunity and potential inspiration to work with a company who can more readily facilitate a sale. 

Corridor's automated contract lifecycle management application ensures that this does not happen.  Those involved in Sales can easily initiate new sales contracts from within Salesforce.com or the CRM where they live.  Negotiation can be readily facilitated within automatic redlining, email distribution and check-in check-out functionality for version control.  Once the contract is complete, final copies can be distributed via email for electronic signature.  Throughout the process, the current status of the contract can be easily tracked, and escalations can take place when bottlenecks occur.

Pitfalls 5, 6, and 7: Negotiations Focus on the Wrong Terms and Risks, Contracts Lack Flexibility, and Contracts Difficult to Use or Understand

Contracts are the tools by which companies and individuals do business with one another.  It is imperative that these contracts focus on the appropriate business issues and risks, and that they reflect the current needs of the organization.  Those who are participants in the contract negotiation or management process need to readily understand the key terms and provisions of the contract, where areas of flexibility exist, and potential options for compromise. 

A sound contract management process is one which includes not only the establishment of standard contracts and templates, but also a systematic review of these materials to ensure that they continue to address business needs as well as current industry issues.  A contract playbook frequently exists for purposes of alternative language suggestions and pre-approved flexibility and compromise.

Corridor's Contract Management Application, CM[.app], elegantly addresses these requirements.  Users can have access to a repository of contract templates – automated or otherwise.  These templates can be shared with the organization or they can be secured based on roles and unique access requirements.  Automated review cycles can be scheduled to ensure that the contracts are current and that they address important industry or legal changes.  Language fall back provisions, as well as a contract playbook, can be conveniently provided to those involved in the negotiation process so that efforts are not unnecessarily expended around the wrong terms or risks.  Greg Tennyson, Chief Procurement Officer for VSP Global and a long standing Corridor client, summarizes his experience with Corridor's solution as the flexible source of truth that they needed in a contract management system.

Pitfalls 8 and 10: Poor Handover from Deal Team to Implementation Team and Poor Post Award Processes and Governance

A considerable amount of time and effort goes into the negotiation process and closure of a contract.  Unfortunately, there are numerous occasions when these highly negotiated provisions are not communicated to the implementation team or to the team responsible for the long term management of a contract. This lack of communication creates considerable risk and missed opportunity for an organization. The importance of having a system in place for all team members to have visibility into key contract terms, updates, obligations and more is essential in guaranteeing that contracts are managed properly throughout their entire lifecycle. 

Corridor's robust contract dashboard provides easy access to key terms and provisions, supporting documentation (including children contracts and amendments) and obligations.  Our Content Extraction Module or CEM allows our clients and third party providers the unmatched ability to identify and pull key language provisions from any contract that they choose for ongoing management. Our alerting and reporting mechanisms ensure that key dates and deliverables are flagged and escalated for additional management attention, when appropriate. 

Pitfall 9: Limited Use of Contract Technology

The final pitfall in poor contract management – and in our humble opinion! – the most onerous of them all is the limited use of contract technology.  Despite the many options available, your company may have no solution in place to assist with your contract management process. Or, it may have a solution with limited deployment or challenges in acceptance.  In any case, the impact to your business in not managing your contracts properly is severe.  Tim Cummins of the IACCM states that poor contract management costs companies almost 10% on their bottom line.  For all of the reasons previously stated, an automated contract lifecycle management application can deliver immediate ROI to your organization - while also increasing opportunity and reducing risks. 

As an organization selects a technology, it is important to choose one which is user friendly, intuitive, easy to support, and addresses overall business requirements.  It should also have the flexibility to support unique organizational requirements which are critical for your organization. Continuous product innovation is also essential as the contract management arena is continuously evolving and becoming more complex.

And, as important as is the technology, so, too, is the organization with whom you do business. Your selected contract management vendor should be a true partner to your organization.  Throughout the implementation cycle, go live and on-going maintenance of the application, road bumps will invariably arise.  It's critical that your vendor has not only the experience necessary to ensure your organizational success, but also the infrastructure and interest to do so.

To Close

H. James Dallas, a contributor to Fortune Magazine, says that managing change is the make or break in order for organizations to measure their success.  States Dallas, "Leaders who successfully reshape their organizations are sought after and respected.  Their organizations aren't crushed by changes in their industries; rather, they find ways to leverage those changes." 

Business initiatives and processes are always changing.  Material changes are taking place in the contract management space as contract management becomes a critical business function.  As Tim has suggested in his Ten Pitfalls, it is important to understand these issues.  And, as we are suggesting, it is equally important to understand how technology can support systematically addressing these pitfalls.

Next Week's Blog

Get ready for next week.  Join us as we examine the story of a Western Australian Health Department official overspending on an IT contract by $40 million!  Your eyes are not fooling you, yes, $40 million!  Find out Corridor's take on the issue and the proper techniques and initiatives that should have been implemented to avoid this disaster.  Stay tuned!

Rob writes on contract management and business applications for Corridor Company. 

Read More
Contract Management Software Blog - ​This Week in Contract Management | Corridor Company Hosts IACCM at Local Boston Chapter Conference
​This Week in Contract Management | Corridor Company Hosts IACCM at Local Boston Chapter Conference, 04.06.2016

 

Post by Rob Lunder, Marketing Manager, Corridor Company

Mr. Rob Lunder meets Mr. Tim Cummins

Corridor Company, the leading provider of Contract Management Software powered by the SharePoint and Microsoft Office 365 platforms, had the distinct pleasure of hosting the IACCM Boston Chapter Conference on Thursday, March 17, 2016 at Corridor Company's Corporate Headquarters in Wakefield, Massachusetts.  For those of you who are unaware, IACCM, also known as the International Association for Contract and Commercial Management, is the world's leading professional organization and expert in Contract Management.  Given IACCM's industry status and the many companies in attendance, this was both an honor and pleasure for us at Corridor Company.

As a fresher face to Corridor Company, this was my first IACCM meeting, and my first opportunity to meet the well reputed IACCM President and CEO, Tim Cummins. An avid reader and a planner-at-heart, I prepared for my first Tim Cummins' encounter by thoroughly reviewing his blog, Commitment Matters.  If you aren't familiar with his blog, I'd highly recommend you take a few minutes to check it out.  As you read through his entries, you gain a heightened sense of Tim not only as a leader, but also as an innovator.  His writing style, ability to anticipate and answer questions which his pieces inspire, and expert facilitation skills result in both thought provoking and thoroughly educational pieces.

As our meeting started and Tim entered the conference room, he immediately gained the attention of all those in attendance.  My anticipation and excitement over our first meeting were well merited as his presentation and subsequent discussion materials did not disappoint.  He opened his discussion by reviewing contract and commercial management and commercial management as a basis platform to breed success and innovation.  More specifically:

 "Commercial Management is the activity which defines the overarching policies and practices that provide a framework for trading relationships." "Contract Management is the discipline through which those policies and practices are implemented and within which individual transactions are agreed and performed."

As Tim explained, understanding the relationship between Commercial and Contract Management and how Contract Management feeds off Commercial Management is fundamental to the industry.  Commercial Management is a foundation through which organizations can build successful partner relationships and adhere to business and compliance standards.  This involves working as part of a collaborative effort where teamwork and trust is persistent throughout the entire organization. Honesty is an effective way to start.  This was something that Tim couldn't stress enough as he educated the Boston Chapter on ways to better manage contracts.  An honest and collaborative environment mitigates risk and ensures that contract management proceeds successfully.  

Throughout the remainder of his presentation, he stressed three central themes: Collaboration, Reputation, and Risk.  Each term serves a clear and attributable purpose to the dynamic world of contract management.

Collaboration: A Key to contract management is the concept of collaboration.  Betsy Burton of Gartner, the leader in Technology Research, defines collaboration as "People working together on non-routine cognitive work.  This activity is about behavior, work habits, culture, management, and business goals and value."   Tim defines collaboration as "building a shared commitment to achieving outcomes."  Contract management, at its core, is focused on collaboration and teamwork at every stage of the contract lifecycle.  The individuals involved in negotiating the contract need to collaborate in order to achieve a mutually beneficial outcome.  Those involved in the creation, approval, and management of the contract also need to work together closely and effectively to ensure that the contracts proceeds through the organization in an efficient manner.

Reputation: An organization is nothing without its reputation.  An ongoing commitment towards excellence and outstanding customer service should be two areas of focus for any company.  Tim emphasized trust when managing the day to day handling of contracts.  When you allocate duties and responsibilities in this process, you need to do so knowing that you have the best people in place to facilitate its success.  Christopher Elliott, a contributor to CBS Money Watch, believes that reputation management is all about avoiding business disasters.  Disaster is defined differently within different organizations. A disaster in the restaurant industry is likely far different from one in the construction industry.  Disasters in the areas of contract management are numerous – and can occur in all phases of a contract's lifecycle. An improper review of a contract has potential catastrophic downstream effects. Failure to deliver on contractual obligations can also prove disastrous.  In the world of contract management, it is vital to put in place both the proper resources as well as supporting processes to ensure that disasters are mitigated, outstanding client service is delivered, and reputations are kept intact. 

Risk: Risk is something that doesn't go away.  A key to risk mitigation is the establishment of order, and ongoing goal planning. According to the Wall Street Journal, goals should be implemented and monitored within an organization to track progress.  The Journal also adds that the only way goals can be achieved is if everyone clearly understands their target objectives and works together as part of a unified effort.  In the world of contract management, it is imperative for all contract team members to have clear target objectives and a list of goals which they hope to achieve in proactively managing their organization's contracts.

Tim also highlighted being a leader in change management as a successful tactic in managing risk within your contracts.  Roger Trapp, a contributor to Forbes Magazine, states that between half and three-quarters of change initiatives commonly fall short of their target objectives, or ultimately fail.  A leader in contract management is someone who has the ability to adapt to change on a number of unique levels. Being a leader in change management is helpful when managing risk within your contracts.  Once processes are changed or systems are implemented, it's important to ensure that the individual leading the effort can properly promote and support the initiative.  It's fantastic to put in place improved processes and systems, but critical to their success is the ability to effectively address the change management necessary to ensure that these items are adopted.

As I left the meeting, I reflected on much of Tim's guidance in the context of our company and our product.  As a growing software company, we pride ourselves in adhering to all of the principles that Tim so eloquently espoused.  Our corporate culture is one which both encourages and rewards collaboration – internally as well as with our clients and partner organizations.  With 100% client reference-ability, reputation is of utmost importance to us.  When we sign a contract, we never fail to deliver or to deliver on time. From a risk mitigation perspective, we have clear objectives internally and with our clients – and we consistently augment and refine as new situations arise.

As a software company that provides a fully robust contract lifecycle management application, I was further encouraged by the fact that our software provides direct support for all areas of Tim's presentation. It would be remiss of me not to mention that our Contract Management [.app] for SharePoint has direct support for the collaboration, reputation and risk management considerations which Tim highlighted throughout his presentation.  IACCM is an industry leader and expert in contract management.  To sync with them from a philosophical standpoint is very rewarding for Corridor Company. 

Next Week's Blog

Are you ready for next week's blog?  You should be.  We will discuss Tim Cummins and the IACCM's Ten Pitfalls of Current Contracting and Commercial Management and how Corridor Company's contract management lifecycle software addresses many of these pitfalls. Sleep better at night knowing that your contracts are in good hands.  Stay tuned for next week!

Rob writes on contract management and business applications for Corridor Company.

 

 

Read More
Contract Management Software Blog - Meeting the Public's Demand for Supplier Information with Electronic Systems
Meeting the Public's Demand for Supplier Information with Electronic Systems, 12.03.2015

 

​Post by Dermot Whittaker, Sales Support Manager, Corridor Company

Recent headlines around Nestlé's confirmation that there is forced labor in its fishing supply chain will not come as a surprise to people in global procurement. Procurement professionals know that a key element of managing today's supply chain includes ensuring that the production of goods and services is not hampered by unethical or environmentally damaging practices. A consumer boycott or legal action in response to bad practices are as damaging as an earthquake or hurricane which takes a key supplier out of the chain.

In most global companies, a "responsible sourcing" director or "sustainability" vice president is tasked with ensuring that no short cuts are taken. Given the global scale of many operations in terms of number and location of suppliers, the management of these suppliers and their supporting data – a supplier's practices, degree of awareness and training – is a challenge. This is because in countries where the rule of law and education are in short supply, and where people look for work to lift them from rural poverty, abuses are almost bound to occur. The abuses include not only forced labor, but also unsafe working conditions, economic ties to armed groups, environmentally damaging mining or agriculture practices, and unchecked pollution of air, land and water. The complexities of the challenge – bringing goods from across the world to market, balancing on-site and HQ-based inspection and buying decisions, leveraging the power of globally known brands in intensely local supplier systems – were spelled out in a Roundtable Report by the Guardian newspaper in 2014.

With globalization a fact of life, money for goods in ignorance of how the goods are produced can last only so long. Phones, computers, fashion clothing, sneakers, and chocolate each have been transformed from status symbols to emblems of injustice when reporting has uncovered unsafe or unfair practices associated with producing them. Consumers become aware of abuses and demand that companies vouch for the production practices of their suppliers as well as their own.

Suppliers, in turn, should also do their own investigation, establish their own standards, and monitor compliance with those standards. Corporations often make the case that bringing the work of poor laborers to market worldwide creates the very leverage and awareness needed to improve their conditions. Supermarket company Tesco's responsible sourcing director Giles Bolton has argued that with their involvement as buyers, businesses can be part of the solution.  Additional options include third-party organizations that offer both training and certification to suppliers, acting as trusted certifiers of good conduct by producers in countries where government authority is weak and regulation non-existent. A recent IACCM Americas Forum presentation featured such a third-party organization, EcoVadis, which has devised an analysis system covering environment, fair labor practices, ethics/fair business practices, and supply chain.

Some fair trade advocates skeptically view these cooperative actions as a way that businesses try to forestall new laws and international conventions. The goal of corporations, they argue, is to avoid having their hands tied by more explicit regulation. Other observers believe that cooperative efforts have a better chance of immediate success than attempting to hammer out a one-size-fits-all international framework. Indeed, private action is sometimes a first step toward legal standards that can be enforced. These observers argue that as more companies find themselves spending money to regulate their own suppliers, legal standards and adequate enforcement across the board are seen as a way of leveling the playing field. As happened in the United States a century ago, media attention, consumer leagues, labor action and corporate responsiveness may lead to increased global regulation.

Regardless of the path that reform may take, the need for global buyers and their associated suppliers to manage their supply chain – in terms of ethically and environmentally sound practices – is paramount. The retailer or manufacturer who needs to answer for their supply chain needs ready access to information. A supplier's certifications of fair practices or non-polluting production, however arrived at, need to be displayed in the supplier's electronic record, along with its financial standing and records of insurance. These evidences need to be kept up to date as one would insurance policies. And, where ethical and environmental standards are specified contractually, electronic contract management can help organizations stay on top of such standards in their suppliers.

Global buyers need to ensure that their suppliers are not only making the appropriate representations, but that they are also providing the necessary supporting documentation – including origin of raw materials, contributing manufacturers, certifications of fair practices or non-polluting production, etc. – to satisfy their contractual commitments. Electronic systems of supplier management such as Corridor's Supplier Management App for SharePoint, or SM[.app], can help effectively manage this process. Systems like SM[.app] have the necessary flexibility, scalability, and the potential to integrate with other electronic systems, that global organizations need in this environment.

Some may consider such monitoring by retailers and manufacturers unnecessary, or beside the point economically. These businesses, it is argued, have enough to do keeping suppliers to agreed prices, product specifications, and standards of quality. But the public, with whom global companies like Nestlé are sharing the facts, may think otherwise. They are creating a demand for more supplier information. Electronic supplier management systems are a key to meeting that demand.

Dermot Whittaker works with Corridor's technology and contract management partners to keep the company focused on current business needs.

Read More
Contract Management Software Blog - ​Contract Management and the Sales Process: Problems of Convenience
​Contract Management and the Sales Process: Problems of Convenience, 10.12.2015

 

Post by Jasmin Steely, COO, Corridor Company

Sales relies on momentum to succeed. When a customer shows buying signs or gives verbal confirmation of his or her intent to purchase, sales needs to seize the moment and guide the customer quickly – and carefully – through to the end of the funnel and the signing of the contract. Unnecessary delays introduce a variety of self-inflicted issues: budgets are reviewed and reduced, champions change positions, and new initiatives may trump a predecessor. The longer the closing process is, the greater the chances that a verbal confirmation will not move forward to actual closure.

Delayed closures = delayed cash collection, revenue recognition and commission payments.

Contracts are the very place where a significant portion of these delays occur. Every extra moment spent searching for the correct contract or template, reviewing the contract, and discussing alternative language provisions slows down your sales process and impacts your final sale. Even if the sale does go through, longer contract resolution intervals could mean delayed revenue recognition and fewer sales over time. That’s because time is wasted pushing an existing deal through, instead of finding or processing a new one.

Inconvenient contract management practices hinder sales

When an opportunity progresses to the contract stage and your team needs to present the customer with a contract, what’s the first thing they need to do? Do they grab a contract from your library? Build one from scratch? Escalate to their Sales VP for direction? Contact the legal team and hope they respond quickly?

Far too often, sales reps are slowed down by awkward and inefficient contract creation and approval processes. Contracts that aren’t readily accessible or don’t address the current sales situation cause unnecessary red tape and lost time.

I recently negotiated a deal with a reputable agency. Not only was the contract they sent unnecessarily lengthy and arduous, it didn’t address the situation at hand. The result? An apologetic and embarrassed sales rep, a frustrated buyer, and weeks of time spent reviewing and updating an ill-fitting form. Not only was I unhappy; the process brought into question the vendor’s credibility and delayed my signature of the contract, my payment to vendor, and their ability to recognize the sale. What should have taken a day or two of reviews and updates took several weeks of unnecessary time and effort. If, during that process, my focus had been directed elsewhere, this deal likely would have been shelved entirely.

All this unnecessary back and forth also wasted a fair amount of manpower and money in legal costs associated with drafting and reviewing a contract. More often than not, contract changes, language changes and final review are performed by senior members of the legal staff. Indeed, assigning the right work to the right people can help, but this doesn’t address the larger problem of inefficient contract management practices hindering sales and increasing overall legal expenditures.

Lax contract management puts the company at risk

At the other end of the spectrum are contract management processes so lax that they barely qualify as a process, or those that are entirely circumvented by the sales rep himself in the name of convenience.

If the contract drafting or review process is too onerous (or is non-existent), a sales rep may simply utilize local copies of the contract which he has kept on his own computer. While this might not seem such a big deal at first glance, this practice carries a lot of legal risk. For example, the contract he uses may not be entirely appropriate to the current sale. Or it may include irrelevant or inappropriate information. Also, the official company contract might have been updated without the rep’s knowledge, and he may find himself using outdated paper.

Lax contract management processes also present themselves during the contract negotiation process, where the rep or his manager push the sale through without informing Legal. Have you ever been involved in a negotiation where you wonder if the other party even read your contract changes before agreeing to them? While the contract may close expeditiously, the company is now exposed to future legal risk from terms and conditions to which they had inadvertently agreed.

Balancing convenience and security

The ideal situation is to establish a streamlined process for drafting and reviewing sales contracts. The company needs to establish a standard contract templates for multiple scenarios, and to store these in a location easily accessible to sales. For companies with contract automation solutions, it is possible to have the contract assembled based on the rep’s response to a few basic questions. If or when negotiation occurs, the rep or his manager should be able to easily swap approved relevant clauses in and out of the paper, which can also be readily facilitated by a contract management automation solution. The same goes for the contract review process. Any new contract wording should be first approved by legal prior to actual signing. It would be best to track each version of the document separately, just in case there is a dispute later and the history of the transaction needs to be reviewed.

As you establish your contract management process, keep the sales rep’s user experience in mind. What would make the process easier and more convenient for him, while not sacrificing the steps necessary to ensure your business is protected? Doing so will result in a more streamlined and effective setup that will result in more sales and better terms for your company.

Jasmin Steely is COO of Corridor Company. Jasmin has spent the last 15 years of her career helping software companies achieve operational excellence.

Read More
Contract Management Software Blog - Why SharePoint? Corridor & Its Contract Management Application
Why SharePoint? Corridor & Its Contract Management Application, 09.22.2015

 

Post by Aaron Cutlip, CTO, Corridor Company

As the CTO of Corridor Company, I’m frequently presented with the question, “Why SharePoint?” Having used a multitude of different technologies throughout my career as well as numerous content management systems, my response is immediate. Not only does SharePoint provide us with a world-class platform upon which we can build our product, it is one of the most flexible, user focused and prevalent products on the market.

Large User Base & High Demand

Taking my last point first, while you may not be well versed in the details of SharePoint, as a member of the business community, you’ve likely used it. SharePoint is present within 78% of Fortune 500 companies and has a user base which numbers in the hundreds of millions. It is the most popular Enterprise Content Management System in the world, and is one of the fastest growing Microsoft products in the company’s history. Yes – much to my son’s disbelief – SharePoint is as popular as Xbox!

Because you’ve likely already used SharePoint and because it is already present within your company, training costs are lower and are more readily facilitated and user adoption tends to be higher. Not only does your IT department already know how to support it, they’ll likely appreciate not having to support yet another application or silo of information.

World Class Platform

As a technologist, however, far more important to me than whether or not people are familiar with or like the technology is the value that the technology delivers. SharePoint, as a development platform, possesses unmatched repository functionality, control definitions, language support, security, search, integration and analytics. As the CTO of a company that develops business-critical applications such as our contract management application, this is vitally important to me. As I plan our technology roadmap, rather than focusing on infrastructure components which are, of course, critical to our application, but which don’t necessarily delight our buyer or end user, I can focus on solving the challenges of my contract management constituency. There are areas within SharePoint where I need to augment functionality, but my primary focus is on developing the best contract management application on the market.

With Microsoft’s R&D budget far eclipsing my own, I’m able to leverage the development efforts as well as the innovation which Microsoft is continuously introducing not only into SharePoint and Office 365, but into its entire product portfolio.
 
I, as well as my customer base, are also able to benefit not only from SharePoint’s out-of-the-box integration, but also from the integration that the market provides in terms of “hooking into” SharePoint. Microsoft’s native Business Connectivity Services (BCS) allow external data to be connected into SharePoint with bi-directional updates. For my contract management users, this allows significant efficiencies to be introduced. Information need not be entered multiple times, contract data including spending can post directly into a Line of Business (LOB) system, and contracts can be accessed from wherever the user “lives.” And, because of its popularity and market prevalence, virtually every major software vendor, including SAP, Oracle and Salesforce, have worked with Microsoft to deliver varying forms of integration with SharePoint and Office 365.

Finally, I have the added advantage of flexibility in my delivery platform. While functionality differs between versions and is licensed independently, because I leverage SharePoint, I have the ability to deliver my product on premises, in the cloud or via Office 365. For those organizations with distinct security requirements, I can also provide a hybrid solution for documents or data which need to remain on premises.

Flexibility

As a commercial off-the-shelf software company, Corridor strives for product and implementation consistency. This allows us to deliver the best product to the market at the lowest cost point with the least amount of ongoing support requirements. While we’ve worked diligently to design the best contract management system in the market, our reality – and that of our client base – is that unique organizational requirements invariably present themselves. By leveraging SharePoint as the development and delivery platform for our product, we’re able to accommodate many unique business needs without the need for custom code. SharePoint’s flexible nature allows us to do through configuration what many other products can only address through custom code.

Power in the Hands of the User

Traditional document management and contract management systems are highly dependent on IT for day-to-day support as well as any necessary changes. Support queues, request clarifications and red tape all contribute to slow and painful change management processes.

With SharePoint, business users and tech-savvy employees can make a variety of changes directly. Support of the system becomes much more expedient and efficient, and the team involved in managing the application has a level of autonomy and ownership which integrates well with the IT controlled elements of SharePoint.

These are just a few high-level reasons why we chose SharePoint as the basis of our contract management application. We, as well as our client and prospects, are able to continuously benefit from the power and flexibility provided by SharePoint.

I’ve never regretted choosing SharePoint. In fact, I think it was the smartest decision we ever made.

If you’d like to hear more, download our whitepaper SharePoint as a Platform for Contract Management.

Aaron Cutlip provides vision and decades of experience as he leads Corridor’s R&D team.

Read More
Contract Management Software Blog - Dueling Contracts: Third-Party Contracts or Standard Company Template?
Dueling Contracts: Third-Party Contracts or Standard Company Template?, 09.15.2015

 

​Post by Jasmin Steely, COO, Corridor Company

Imagine this: you're negotiating a business deal, and things are going really well. Both sides agree on what is expected, and the relationship is off to a great start. But, then the contract negotiations begin, and questions arise around whose contract will be used.

Both of you have your own preferred contract agreements, and, of course, want to base your working relationship on your contract. But, you also want to wrap the deal as expeditiously as possible without too much resistance or damage to your burgeoning relationship. You think, "What's the harm in using their contract instead of mine?"

Possibly nothing, and possibly everything. Both methods have merit, for sure. But what is the ideal practice? Let's break it down:

Using Your Standard Company Contract Templates

First and foremost, using a standard company template creates less work for your legal team since they are already familiar with the terms, what's important to you, where you're willing to negotiate and what your fallback provisions are.

Also, if you have a contract management system, your templates are already prepared. With a simple click of a button and the completion of a form, the agreement can be assembled and emailed to your counterparty for review and signature. Workflows for tasks and approval processes are in place and the overall process is much more efficient and expeditious.

From a negotiation perspective, you're more likely to get more favorable terms if you start with your own template, as opposed to starting with the other party's. Your standard terms and conditions are clearly stated and the other party will likely only request changes which are material to them.

Using Third-Party Contracts

Despite the advantages of using your template, there are instances where using third-party contracts are preferable – or, when you, simply, will not have a choice.

The most obvious situation is when you don't have your own standard templates or contract playbook or you're in process of assembling an effective legal team to review and define your standard contracts and terms and conditions.

Another occasion is when you don't have experience in a particular industry – likely as a customer of this industry. For example, if your company's area of focus is manufacturing, and this is your first foray into buying software, you're best served by utilizing your vendor's template as it will address the terms and conditions which are important to the software industry. These vendors (the good ones, anyway) have fulfilled many such contracts before and have direct experience on what needs to be addressed from a contractual perspective.

Then, of course, there are situations where you simply will not have a choice. Your vendor or customer has internal mandates regarding the templates and simply will not do business with you, otherwise. In these cases, closely review their contract and make all suggestions which are important to your company. Your standard contract template and your contract playbook can still be leveraged to expeditiously source the language that's important for you.  

Remaining Flexible

In both cases, it's important to remain flexible. Neither party should blindly and arbitrarily adhere to their standard template. Tim Cummins, CEO of IACCM, specifically speaks to this his blog post regarding the dangers of inflexible templates. "To work well," Tim notes, "standards must operate within an intelligent management system which ensures they are appropriate to business goals." Both parties must be ready to adapt their contract templates to individual circumstances and market changes.

In these instances, a contract playbook becomes key. Contract playbooks not only provide pre-approved alternative language suggestions for efficient negotiation, but they also highlight important contract clauses which can be easily sourced to the other party for inclusion in their template.

The Final Word

The choice is clear-cut: if you can manage it, always use standard company contracts. And, even better, leverage a contract management solution.

Standard templates are your best option for a speedy and advantageous contract negotiation. But, be realistic in your approach, and put in place a systematic process to review and update your templates with the latest clauses. Store them in a place that is easily accessible so that those who need to use them – do. And, for those situations where flexibility will be necessary – whether for your contract template or for third-party paper – build up your contract playbook so that you can readily source language clauses which are important to you or options which make the other party's standard template more palatable.

Jasmin Steely is COO of Corridor Company. Jasmin has spent the last 15 years of her career helping software companies achieve operational excellence.

Read More
Contract Management Software Blog - Obligation Management from Simple Tracking to Complex Automation
Obligation Management from Simple Tracking to Complex Automation, 02.11.2015

 

Post by Russ Edelman, CEO, Corridor Company

It is safe to say that most commercial contracts have some form of obligations defined for your organization, the other organization, and/or for all organizations involved. The level of complexity, frequency, ownership and demonstrable success with these obligations will vary as widely as the performance related to the obligation. So, as a contract professional, you have a range of choices, from feigning complete ignorance to adopting a highly sophisticated obligation management strategy. Regardless of your choice, the decisions that you make will play a significant role in your contract risk portfolio.

For practical purposes, I’d like to take a moment to define two reasonable strategies around obligation management with the understanding that burying one’s head in the sand is simply not a pursuit-worthy strategy!  I would also argue that you need to align your strategy with your organization’s appetite for risk, discipline and the nature of the contracts in question.

As a starting point, let me introduce two approaches: “Base Obligation Management” and “Advanced Obligation Management.”  While these terms are somewhat self-explanatory, I’d like to provide an underlying set of definitions and examples.

Base Obligation Management

As the name implies, Base Obligation Management is all about the introduction of some preliminary cataloging and tracking of obligations. This may take the form of a piece of paper, a spreadsheet, or a database that is used to track such obligations. Accompanying these catalogs is a need to properly track obligation due dates, deliverables and the completion of the obligations. From a systems perspective, the importance of having a centralized database/repository that you can act upon is a key dimension to base obligation management.

Advanced Obligation Management

As one might expect, Advanced Obligation Management takes Base and extends it significantly. This is typically performed through heightened automation, additional data elements that need to be tracked and the introduction of “obligation outcome automation.” Let’s explore each point in greater detail.

  • Heightened Automation can include semi-automated or fully automated obligation extraction from contracts. For large contracts that may have hundreds or thousands of discreet obligations, an automated mechanism for extraction becomes very important. Additionally, automation may come in the form of establishing recurring obligation patterns, obligations that need to be performed on a regular basis for an extended period of time (for example, quarterly reports).
     
  • Additional Data Elements may be introduced that provide a more comprehensive view of the obligation. These elements may include obligation risk levels, priorities, regions or other data factors that will help with the execution of the obligation. One example of such a data element is an “obligation interpretation” data field, a field that allows for the person memorializing the obligation to provide an understandable explanation of the obligation which in its original contractual language may be legalese.
     
  • Obligation Outcome Automation takes a substantial evolutionary step forward when contending with obligations. Here we are referring to actions, ideally automated, that can be introduced based upon the disposition or absence of disposition of an obligation. For example, if an obligation is not addressed in a timely manner (i.e., by the obligation due date), it may be appropriate to have the system automatically create a risk that can be managed and tracked. The creation of the risk may then be linked to your financial forecast. Likewise, if an obligation is satisfied and the status is flagged a certain way, an opportunity with the counterparty may be presented and pursued. In this case, the opportunity may be automatically created and this could also have an impact on the financial forecast.

In both Base and Advanced Obligation Management, there is typically a need for reporting, alerting and escalations such that obligation owners can be notified proactively as their obligations are approaching their due dates. When the right obligation strategy is properly employed, risk is substantially reduced, and when architected correctly, new opportunity can be acted upon that would otherwise go unnoticed.

So, we recommend you perform some exploratory work on Base and Advanced Obligation Management and know that Corridor can assist on both fronts.

Read More
Contract Management Software Blog - The “Un-Contract” & SharePoint’s Unfair Competitive Advantage
The “Un-Contract” & SharePoint’s Unfair Competitive Advantage, 02.11.2015

 

Post by Russ Edelman, CEO, Corridor Company

Most of today’s contract management system suppliers worth their salt have a collection of common features that allow them to qualify as legitimate contract management systems. This may include automated contract generation, contract approval, contract reporting, etc. The purpose of this blog is not to explore every aspect of a today’s contract management systems. Rather, this blog is all about the “un-contract” and why SharePoint is uniquely positioned to offer a unique value proposition that other CM platforms cannot. Coupled with Corridor’s Contract Management Business App for SharePoint -- CM[.app] -- an entirely new world opens up for applications which are adjacent or complementary to a contract process. We call these the “Un-Contracts.”

What Is the Un-Contract?

Let us first start with the definition of the Un-Contract. For our purposes, it is some type of functioning system that is typically a complement to a contract, but rarely something that is included in a contract management system. A few tangible examples include Survey Compliance Management, Foreign Corrupt Practices Act (FCPA) Management, and Corporate Entity Management. In the case of surveys, there is often a need by organizations to perform surveys for employees and sub-contractors which demonstrate contract compliance. With FCPA Management, there is an on-going need to validate the background of contributors through international corruption tracking services. And with Corporate Entity Management (an idea initially introduced to me by Rene Gonzales, Esq., of Gonzales Consulting), there is frequently a need for global organizations to have a centralized facility for managing all corporate entities and their respective corporate filings in each respective jurisdiction. Please keep in mind that these are just a few examples, and with some creative thinking, many other such systems can be identified (e.g., Real Estate Management, basic Document Management, Policy Management, etc.).

The Advantage of SharePoint and CM[.app]

Second, let’s talk SharePoint. SharePoint is incredibly well-designed to support such Un-Contract applications. Why? Because it allows repositories of information to be easily created, secured, processed and, to a lesser degree, reported upon. They can be tied into the primary contract data structures to provide one cohesive system. For example, surveys can be linked to contract records, FCPA requests can be initiated during a contract review process, and corporate entities can be employed for validation purposes when entering and maintaining contracts.

Third, CM[.app] allows for Un-Contract applications to be taken to an entirely different level. For example, automated alerts and escalations can be employed to ensure surveys are being processed on a timely basis. Workflow automation services may allow for simplified integration with third-party validation providers. And CM[.app] can easily be configured to support distributed notifications and reporting for corporate entity reporting.

Why does this matter? Because many companies typically purchase numerous systems which are then silo-ed and few of these provide functionality that is materially more substantive than applications that can be configured using a combination of SharePoint and CM[.app]. It should also be noted that we will be the first to identify when systems are not well-suited for such efforts.

And with this, we say…welcome into the world of the Un-Contract.

Read More
Contract Management Software Blog - Contract Economics 101: Transforming Your Contracts into Opportunities
Contract Economics 101: Transforming Your Contracts into Opportunities, 11.11.2014

 

​Post by Dermot Whittaker, Sales Support Manager, Corridor Company

In discussions of the ROI of a contract management system, the distinction is often made between efficiency and effectiveness. Getting more work done in less time, or at lower cost, is efficiency. When a contract management system reduces search time for contracts, allows standard language to be reviewed once instead of multiple times, and allows contract professionals to handle work that used to go to more skilled (and more costly) attorneys – that’s efficiency.

Effectiveness, on the other hand, can be defined as perceiving the value a contract offers, including the opportunities for business growth, and consistently acting to realize that value. In a positive sense, this means keeping the organization aware of the buying terms agreed to in a contract and, where possible, making purchasing decisions conform to those terms at their most beneficial. In negative terms, it could mean recognizing the risks that the contract presents – for example, risks of non-delivery by your organization or the counterparty’s – and acting to reduce the risks or using the contract terms to mitigate them.

Efficiency and effectiveness usually work hand in hand. For example, a contract management system that allows managers to extract obligations from the contract text and create tasks and workflows around them is a giant leap forward in efficiency that also helps these professionals reach high levels of effectiveness by giving them access to contract information and alerting them when attention is particularly needed.

When contract managers are aware of the terms of the contract and the realities of the business dealings post execution, they are in a position to recognize and seize opportunities – that is, they can realize, even maximize, the benefits promised in the contract. When they do this consistently – a challenge when managers are few and contracts are many – they show effectiveness.

Paths to Effectiveness

The premise of a contract is that both parties to agree to the business terms and goals and to the contractual terms to reduce or mitigate the risks associated with those goals. Once a contract is signed, it falls to the contract manager to see if the conditions are being met and, if not, that the risk mitigation steps are being followed. This post-execution obligation tracking is one of the most important roles the contract manager has.

Some areas where contract managers can show effectiveness:

Price Discounts – Supplier contracts may offer a discount in return for volume purchases, for prompt payment, or for reciprocal benefits named in the contract. Where contract managers can track spending under the contract, they can determine if the prices paid were the lowest the circumstances allowed. Managers can then adopt new purchasing strategies or approval processes to insure that future purchases are made in accordance with these discounts. In some cases, the managers may be able to recover the overcharges. In the case of rebates, the contract manager can identify these and see that they are applied for and claimed.

CM System Impact – Where possible, integration of a contract management system with the ERP or accounting system can make it easier for a contract manager to access data of spend under the contract or more broadly with a particular vendor.

 

Price Adjustments – Supplier contracts may allow prices to change based on market conditions over the life of the contract – provided the purchaser does the homework to invoke these changes. If a product is widely available at a lower cost from other suppliers, a contract manager may use the supplier contract to request a reduction in price.

CM System Impact – Where the supplier contract contains terms allowing price reductions based on the lowest market price, a contract management system can be used to create a reminder to review the market prices periodically to determine whether a price reduction should be requested.

 

Tracking Obligations – This means your obligations as well as the counterparty’s. Your own organization may have the best of intentions where your own obligations are concerned, but these obligations can go unfulfilled if they do not have owners and the owners are not made aware and reminded of these obligations. Reporting requirements are prime candidates for neglect unless they are identified and assigned. As for the counterparty, identifying their obligations and tracking them before the due date has many benefits. For example, in a multistage, cooperative venture, the contract manager becomes aware of counterparty deliverables, assesses the risk of these turning into stumbling blocks, and addresses them in an ongoing manner so that business proceeds as smoothly as possible.

CM System Impact – Managing dozens or hundreds of obligations associated with a contract by listing them in a spreadsheet is a common practice. The spreadsheet method has limits. How much of its organization and follow up logic remains in the head of the spreadsheet owner? How are reminders and workflow produced, if not manually? Most importantly, how are failures to meet obligations escalated when problems are not remedied on a first attempt? A contract management system with obligation extraction and tracking capabilities minimizes the work involved in capturing and monitoring the obligations, permitting more expertise to be expended in intelligently assessing the status of the obligations.

 

Mitigating Failure to Deliver – Suppliers and subcontractors are not always able to deliver goods and services on time or as specified. Contracts are made to insure that remedies are available in these circumstances. When contract managers tracking deliverables discover one that is late, defective, out of spec, or unfulfilled, they can make sure that that the best available remedy is invoked  whether this is a price reduction, refund, servicing option, or rushed delivery. Simply making these options known within the organization or in discussions with the supplier can insure that follow up to the failure occurs as the parties agreed.

CM System Impact – Setting up conditional alerts – tasks and reminders that only occur where a condition is met – is a way to bring follow-up attention to unfulfilled obligations. In a contract management system, if a deliverable, milestone or fulfillment percentage is not reached by the agreed date, a task tied to the remedy clause of the contract can be assigned, automatically alerting a designated contract manager to invoke the most appropriate remedy, and escalating as needed.

 

Renegotiation – Organizations sometimes find themselves renewing contracts without renegotiating or even effectively reviewing them. For long-term contracts or contracts for goods and services in rapidly changing industries like high tech or telecommunication services, this is a scenario to avoid. Renegotiation renews familiarity with the market, and usually reduces costs while obtaining better service. Contract managers can enable their negotiating team to get the best possible terms by alerting them to a contract’s expiration early, ideally with 1 to 3 months’ notice. There may even be price discounts or locking in of lower rates if a contract is renewed x amount of time before expiration.

CM System Impact – Knowing when all of their contracts are due to expire or renew is often the first benefit contract managers look for in a contract management system. In addition to reporting on contract expiration dates, a contract management system can assign review tasks to contract owners months in advance so they can prepare for renegotiation. Conditional alerts can provide greater notice for higher value contracts, or for more complex, long-term contracts.

Extending Value Beyond the Contract

Beyond the successful management of any one contract, contract professionals can demonstrate effectiveness in two other ways. First, by staying aware of which contract terms are being met and which are at risk, contract managers can address these promptly with the external party (whether a supplier or a customer) minimizing damage to the business relationship through informed communication, often informal. A supplier or client who realizes that they have an observant partner on the other end of the contract is motivated to treat the contractual agreement as the basis of an ongoing business relationship. Furthermore, addressing any failure or risk of failure sooner rather than later avoids the stresses of late stage failure when larger goals or the entire project is at stake.

Second, by tracking and recording performance of terms, clauses, payment plans, service credit systems, etc., the contract manager can suggest improvements to future contracts, backed by documented business experience. Users of contract management systems can track the instances of disagreement over terms, conflicts and their resolutions, cost of service, and many other aspects of a contract that go beyond purely commercial considerations. Having access to this information in a reportable, organized way makes the contract manager a valuable voice at the table when business decisions involving supply chains and subcontractors need to be made.

In short, contract managers can identify opportunities for savings, anticipate or mitigate risks, and monitor performance of contracts across a portfolio. Contract management systems can help them do this by making the information reportable and actionable through clear tagging of obligations as well as the assignment of tasks associated with these obligations. Obligations that are not met receive appropriate responses and escalations. The combination of trained professionals and up-to-date contract management technology can raise the performance of contract managers from one of simple efficiency to recognized and valued effectiveness.

This is the last of our four-part blog series “Contract Economics.” The entire blog series is referenced below. Watch for our whitepaper on this topic, available soon.

Contract Economics Blog Series

Introduction
Part 1 Focusing the Right Human Resources on the Right Business Problem
Part 2 Leveraging Process and Automation
Part 3 Building a Business Case for a Contract Management System
Part 4 Transforming Contracts into Opportunities

Contract Economics Webinar - Download Materials

Read More
Contract Management Software Blog - Contract Economics 101: Building a Business Case for a Contract Management System
Contract Economics 101: Building a Business Case for a Contract Management System, 10.10.2014

 

​Post by Dermot Whittaker, Sales Support Manager, Corridor Company

As we think about making a business case for a contract management system, it is worth keeping in mind the following high-level observations:

1) The business case for contract managers themselves – along with attorneys and general counsel – is often merely assumed as their value is not always fully understood by more senior management. It is important to make that value explicit. A well planned, technically enabled contract management system allows these professionals to spend their valuable time applying talent and training to high-value activities as well as managing contracts in the company’s interest.

2) It is rare today to find a company without some form of contract management system. Even organizations that say they have none use spreadsheets to track contract renewals and value, and sometimes even key obligations. Most contracting departments have a goal of keeping electronic versions of the contracts in a central repository; the trouble is often making sure they get there and that amendments and other changes are recorded and attached. Of course, reporting with such arrangements is largely manual. Making the case for a contract management system involves showing its increased efficiency over what is in place, and its added functionality in terms of reporting, audit assistance, compliance, document retention, impact on legal holds procedures, etc.

3) Not everything is in the control of a contract management team. A contract’s complexity, the work of earlier negotiators, either party’s ability to deliver on all terms, and even the relationships among the players at different companies: these factors are sometimes givens that a contract management team has to work with. Improvements to efficiency (process) and high-level review of contracts to memorialize "problems solved" or "practices to be avoided in future," on the other hand, are in the control of contract management team members. A contract management system should substantially increase what is in the control of the contract management team by automating processes to minimize time and effort appropriately, and by providing the means of reviewing contracts in comparative ways and in large numbers.

So, how should we structure the case for a contract management system? How should we organize the case? Here are some high-level distinctions to make in the analysis.

Buy Side / Sell Side

The business processes and even the departments and personnel who will use a contract management system will be different for these two categories of contracts, buy side and sell side. So will the value derived from the contracts. The Head of Procurement will have different concerns and success criteria from the Vice President of Sales. Ask yourself: Is one side or the other driving the change? Will one side or the other implement the system and need to show ROI first? For buy side contracts, increased accessibility to (and increased use of) the approved terms regarding price, quantity, volume pricing, delivery and/or completion will be a goal, ideally leading to better control over spend and reduction in spend relative to a comparable baseline. On the sell side, increased contract volume and shorter time to completion and signing are obvious goals that help to make the case for functionality such as self-service contract creation, automated delivery to and return from the counterparty, and adoption of e-signature. If a contract management system can be shown to shorten sales cycles, reduce cost of sales, and result in faster revenue recognition, one can point to money saved over current processes. There is also important – at times crucial -- business value in the increased use of the company’s approved terms by the negotiators who may be using less-than-current language for lack of ready access to revised, approved language.

Pre / Post Execution

Whether forecasting or demonstrating ROI of a contract management system, it is important to account for improvements to the process and savings both before and after the contract is signed. From a pre-execution perspective, some easily measurable elements are contract volume, contract cycle time, and personnel time per contract. In regard to personnel time, a common area for savings is the amount of time that highly paid in-house or outside attorneys spend on standard contracts. Once standard language and fallback provisions are in place, a non-attorney should be able to carry the contract to completion more efficiently and at a lower hourly rate. Of course, the attorney’s initial investment of time in approving the standard language and fall back provisions must be taken into account, along with attorney time to review and update these provisions, periodically.

For contract managers, there may be a substantial savings in the time devoted to finding and handling contracts or approved language. An electronic repository of record should hold both executed contracts and those under negotiation, largely eliminating the manual searches for these documents in their current state by the negotiators, managers and others who need access.  A contract dashboard for each team member allows contract managers to see immediately where in the process a contract under negotiation is, allowing them to orient to the task at hand immediately. And an automated workflow that alerts each team member only when their attention to a contract is needed saves time and focuses attention. In a business plan, any quantification of the time spent unnecessarily in the status quo and reduced through use of the proposed contract management system helps to make the case for the system. Where hours and hourly rates can be applied to this time savings by attorneys and others, ROI can be readily derived (see some simple examples below).

The glamour may all seem to be on the pre-execution side of contract management, but savings and increased value can also be powerfully demonstrated on the post execution side – albeit with more foresight. On the buy side, the clearest area for post execution savings is a comparison of the negotiated costs of goods and services and the actual costs post execution. Can analysis of spend under several current contracts reveal lapses where the contracts’ terms, volume discounts, early renewal discounts were ignored, and expenditures increased by x amount? If you can identify deficiencies like this now, you can point to savings that effective use of a contract management systems can yield going forward. For both buy and sell side, it may be possible to measure how many contract deadlines (renewal dates, reporting dates, early action dates) are being missed under the current system. Where deadlines are not missed, how many days previous to the deadline are actions taken? While these time measurements do not relate directly to savings, they do demonstrate increased control and agility in the management of hundreds or thousands of such terms in contracts.

More complicated analyses can be made of savings in legal costs post execution. How often does clear and immediate access to contractual terms result in resolution of a conflict in your company’s favor? How often are conflicts resolved by reference to quickly findable contract terms without involving highly paid counsel? How often do disputes stay out of court?  An important part of any business case should be the greatly reduced legal exposure that use of a contract management system as the company’s legal repository should afford, where it increases adherence to standing retention policy.

Easier to Quantify / Harder to Quantify

If the business case for a contract management system were truly a no-brainer, the investment of time and money in the system would be forthcoming without a second thought. But as with contract management itself, some benefits can be more easily quantified than others.

As noted earlier, some easier-to-quantify measurements of contract management are volume of contracts, time from contract initiation to signature, days to payment (by your company or a counterparty), deadlines met or missed, spend under contract, and legal costs tied to contracts under management. A business case should show how a contract management system can impact any of these measures positively over the status quo. Harder-to-quantify measurements require more foresight, preparation, discipline or combined calculation – what contract manager doesn’t have these skills! – and include things like personnel time savings on contract drafting and review (by attorney vs. paralegals vs. contract managers, for instance), contract risks identified or mitigated, fines avoided. One problem in making the business case around these harder-to-quantify factors is that without a contract management system, reporting on any of these items may be time-consuming, arduous or non-existent. But if you are tracking risks at all in spreadsheets or written reports that take hours to prepare and update, and which are shared among a few by email, the case can be made for electronic systems that allow managers to identify and monitor hundreds or thousands of risks and report their outcomes, sharing the results among users based on security or other criteria.

ROI Basics – Some Examples

First ask: Who are the players?

For purpose of discussion, let’s assume these contract personnel and salaries.

​CONTRACT PERSONNEL ​SALARY RANGE ​EXAMPLE SALARY (ANNUAL ​EXAMPLE PAY BY HOUR
​Attorneys  (in-house) ​$100,000 – $200,000 ​$150,000 ​$72.12
​Contract Professionals ​$50,000 – $120,000 ​$80,000 ​$38.46
​Paralegals, Administrators ​$34,000 – $70,000 ​$52,000 ​$25.00

 

Thinking about Savings

One can start at a high, speculative level; would a contract management system make each team member just 10% more efficient in use of their time? Then for a contracting team of 10 (2 attorneys, 6 contract professionals, 2 paralegals) the 10% improvement would total $88,400 in annual personnel costs (using our example mid-point annual salaries above).

That 10% may simply be an educated guess.1 Can one be more specific, at least as far as efficiency goes?

A Simple Case: Finding a Contract

A simple case everyone has experienced is that of finding a correct, final contract. Using our example salaries above, if it takes a paralegal 5 minutes to find a contract (not just any version, not a reference copy on someone’s laptop, but the final, executed version) that’s $2.08 per contract search. If the search takes 15 minutes (quite possible at large organizations with diverse paper-only repositories, or undisciplined use of intranet repositories) that’s $6.25 per contract. A year’s worth of 2,000 contract searches (some fruitless) by that paralegal could cost between $4,100 to $12,500.

If a contract management system helps that paralegal find a contract in 1 minute instead of 5 or 15, it reduces the annual cost of this basic activity by between $3,333 and $11,667.

Now recall that in some situations, contract managers and attorneys often are the ones doing the searching – or directing others to do it and following up – and their rates are higher. A comparable annual cost savings for a contract manager doing the searching with a contract management system is $5,128 to $17,984, and for an attorney doing her own searching (it’s not unheard of!) $9,616 to $33,656.

OK – annual cost savings of between $3,333 to $33,656 just for using the contract management system to search and find final contracts? That’s a pretty wide range, reflecting our broad estimate of time spent (5 to 15 minutes) and equally broad assignment of the searcher’s pay grade ($25 to $75.12 an hour). The point is that with more precise data from one’s own contracting team, one can arrive a cost and savings estimate that is true to one’s experience and company size. Naturally the estimated savings for any company will depend on its salaries, personnel, contract volume, and work flow.

This very simple example leaves aside the qualitative advantages of a searchable electronic repository such as increased likelihood that the contract will be correctly retrieved the first time.

Another Simple Case – Approving a Standard Contract

If an attorney making $72.12 per hour in our example spends even 15 minutes reviewing a short, standard, low-risk, low-negotiation contract (simply insuring that that the company’s approved language has been adhered to and that no changes have been made by the company’s sales people, or by the counterparty’s attorneys) that’s $18.03 per standard contract reviewed. And if the attorney reviews 1000 such contracts a year, the annual cost is $18,030.

In contrast, a contract professional (making $38.46 an hour in our example) can use a contract management system to access only approved contract templates and use automatic red-lining to compare versions and confirm that there are no changes to the standard terms. With such a system in place, standard contracts would need little if any review by the Attorney. If all of these standard contracts could be reliably reviewed by a contract professional using automatic redlining and adhering to approved language, then the total annual cost would be $9,615, a cost savings of $8,415 a year over use of the attorney for review of the same standard contracts.

Furthermore, the task itself is made less time-consuming and more accurate by the use of automatic redlining that shows all changes to the approved language. If the entire review task, now carried out by the contract professional using a contract management system, takes half as long as before, then the annual savings over review by the attorney without a contract management system is now $13,223. And if the paralegal is available to do the work instead of the contract professional, the annual savings is $14,905.

How many attorneys are there at your company? How many such standard contracts are they devoting 15 minutes (or 30 minutes, or an hour) to reviewing? If triaging these contracts through use of a contract management system keeps even half of them off the attorney’s desk, the savings are significant, and the attorney’s time is freed up for higher level work.

The two examples above focus on efficiency. Contract management systems facilitate more efficient use of attorney and contract p​rofessional time in their use of standard clauses, electronic approval processes and negotiation with external counterparties, contract signing with electronic signature, as well as reporting on contracts in process, approved, or expiring. In our next blog, we’ll look at how contract risks and opportunity – areas of tremendous potential financial loss or gain – can be better managed through use of contract management systems.

Making the Case – Final Thoughts on Value

A business case needs to persuade – honestly. Among the less quantifiable but certainly valuable results of a functioning, configurable, responsive and widely accepted contract management system is the effect it has on the contracting team and a company’s counterparties, be they clients or suppliers. Contract managers work the tools that facilitate all businesses everywhere. If they have a contract management system that empowers them, their expertise and knowledge of the contracts’ uses and terms can grow. Clients will come to rely on a company’s contract managers not simply for their judgment, but for their speed and accuracy. And future mutually beneficial business agreements with counterparties, with less trouble, will be more likely.

1"Recent IACCM research suggests that, on average, corporations are losing the equivalent of 9.2% of annual revenue through weaknesses in their contracting process. These losses arise from a combination of missed savings and cost reduction on the one hand, and lost revenue opportunities on the other." ROI of Contract Management. February 2012. IACCM study.

Contract Economics Blog Series

Introduction
Part 1 Focusing the Right Human Resources on the Right Business Problem
Part 2 Leveraging Process and Automation
Part 3 Building a Business Case for a Contract Management System
Part 4 Transforming Contracts into Opportunities

Contract Economics Webinar - Download Materials

Read More
Contract Management Software Blog - Contract Economics 101: Leveraging Process and Automation
Contract Economics 101: Leveraging Process and Automation, 09.23.2014

 

Post by Jasmin Steely, COO, Corridor Company

In our last blog, Contract Economics 101 | Focusing the Right Human Resources on the Right Business Problem, we reviewed the different roles professionals play in creating and managing contracts. While you may have the good fortune to have a team of attorneys in your employ, it might not make smart economic sense to dedicate them to standard contract reviews. Rather, it is best to ensure that those who can most economically and efficiently address the various aspects of contract lifecycle management do so.

Once the correct resources are aligned with their appropriate business processes, making these resources more efficient should then be addressed. Efficiencies can be gained in two areas: by introducing standardization and process, and by automating those processes that are best served through automation. When analyzing how and where to introduce these efficiencies, it is important to do so both in regards to the specific roles that partake in the process (General Counsel, Contract Manager, Sales VP, etc.) as well as the individual contract types (NDA, Sales Agreement, Acquisition Agreement, etc.)

Leveraging our prior example regarding Contract Managers, we suggested that (in most cases) Contract Managers are best suited to negotiate more standardized contracts, to leverage approved language, to manage the contracts themselves, and to ensure that contractual obligations are tracked and met. The reality is that Contract Managers spend much of their day searching for approved language or standard contract templates, reviewing fallback provisions, getting routine language approved, creating lists of obligations and their associated documents for tracking purposes, and assembling and researching data on contracts for reporting requirements. A tremendous amount of time is lost throughout this process – not to mention the aggravation and frustration which are introduced.

When considering the efficiencies which can be gained through the introduction of standardization and process, the following readily present themselves:

  • Use of contract templates which accommodate various business scenarios including NDAs, License Agreement, Professional Services Agreements, Statements of Work, and other supporting documents
  • Socialization and on-going education of the centralized location from which contract templates can be utilized and where executed contracts should be stored
  • Creation of a Contract Playbook with approved language and fallback provisions

In the context of automation, assuming that the appropriate business case applies – note that not all contract processes should be automated – automation allows a variety of efficiencies to be gained:

  • Contract creation via forms which prompt for the appropriate business scenario and required information
  • Automatic sourcing of alternative language and fall back provisions
    Integration of Line of Business Systems for purposes of autofill and consistency of data
  • Proper document control and versioning through check in and check out functionality
  • Automated escalations and approval functionality for high-risk language changes and spending thresholds with alerts and reminders to ensure that action is taken within agreed time frameworks
  • Electronic signature (when allowed) for more efficient contract execution
  • Search of contract repository for existing contracts with vendors, provisions, etc.
  • Automated reporting of contract spend, expirations and renewals
  • Management and tracking of contractual obligations – both simple and complex

As noted earlier, while the benefits of automation appear obvious, automation is not appropriate for all contract and document types, and/or business scenarios. For example, contracts which are unique in nature and are highly negotiated are not good candidates for automation. Business processes which require a high degree of care, are exception based, or require specific human intervention or analysis should not be considered for automation, either. 

Time is money. Ensuring that your processes are as efficient as they can be – whether through standardization or automation – allows your resources to be deployed most effectively, contracts to be more readily created and approved in line with corporate compliance mandates, deals to be closed faster, and revenue to be recognized more expeditiously.

Contract Economics Blog Series

Introduction
Part 1 Focusing the Right Human Resources on the Right Business Problem
Part 2 Leveraging Process and Automation
Part 3 Building a Business Case for a Contract Management System
Part 4 Transforming Contracts into Opportunities

Contract Economics Webinar - Download Materials

Read More
Contract Management Software Blog - Contract Economics 101: Focusing the Right Human Resources on the Right Business Problem
Contract Economics 101: Focusing the Right Human Resources on the Right Business Problem, 09.18.2014

 

​Post by Jasmin Steely, COO, Corridor Company

Picking up where we left off, our first area of analysis for purposes of our Contract Economics discussion includes focusing the right human resources on the right business problems. When considering this in the realm of contract management, there are a variety of areas which need to be considered. How are contracts created and who has the ability to request or provide contracts? Who negotiates these contracts and approves the language changes or the spend? Once the contract is finalized, who signs the contract, where is it stored, and who is responsible for managing the contract to ensure that the obligations – whether those that the company has made to its clients or that its vendors have made to it – are fulfilled? And, who has to support these activities, both from a process and business perspective, as well as a technical (if applicable) standpoint?

Before we answer these questions, allow us to take a step back and review our initial premise regarding comparative advantage. Comparative advantage suggests that the individual or group who can carry out an economic activity most efficiently and/or at the lowest cost should concentrate on this activity. This suggests that the person who negotiates contracts most efficiently and effectively should do so. He, who is best equipped to manage contract obligations, should do so, and she, who excels at managing spend, should focus her time in this area.

We’ve listed several of the business challenges above. There are, of course, many more which are can be discussed, but for purposes of brevity, we’ll focus on these for now.

Applying our rule of comparative advantage, we would want those most efficient at addressing these challenges to focus on these items. As contracts are drafted, negotiated, signed, and managed, the people involved play different roles, all important. While not an exhaustive list, those roles that most readily come to mind include Contract Managers, Attorneys and General Counsels, Procurement Professionals, IT Professionals, Sales Teams and/or Sales VP’s, IT Professionals and Support, and Business Users. Putting aside unique individual skillsets or circumstances, the best match of role and business problem roughly correlates as follows:

  • Contract Managers take the lead in negotiating (more) standard contracts, ideally applying  approved language, managing the contracts themselves, and tracking the contractual obligations.
  • Attorneys and General Counsel assume responsibility for drafting and modifying highly negotiated contracts, and authoring templates as well as acceptable contract language and fall-back provisions.
  • Procurement Professionals drive the RFP-RFQ process, contract negotiation and contract spend.
  • Sales Teams and Sales VP’s use the contracts for purposes of initial sell-side transactions as well as follow-on business.
  • IT Professionals focus their efforts on supporting the technical aspects of the system. This may or may not be in conjunction with a Contract Professional who is responsible for driving the business direction of the system.
  • Business Users utilize the buy-side contracts to procure goods and services to propel their respective companies forward.

One might ask: Is this level of granularity really necessary?

When considering the average cost of negotiating a contract (which an IACCM study cites as ~$5K a contract ) and the number of contracts which a company processes annually (which can number in the hundreds or thousands), we would suggest, yes, it does. To these negotiation costs, add the cost of leakage around contracts which can amount to millions or billions of dollars lost when considering the cost of missed savings around renewals, volume purchases, etc., as well as the risks associated with unmet and unmanaged obligations. The size and complexity of contract management, suggested by the way things can go wrong or right with an organization’s contracts, require different skills from different people at different times.

As Jim Collins so eloquently suggests, you want to put the right people on the right seat on the bus. While your Sales VP may be a whip with technology, it may not be the best use of his time for him to participate in the support of a contract management application.

The General Counsel is responsible for the language that the organization is agreeing to – but she can fulfill that obligation once by approving standard clauses and fall-back provisions and then insuring that the contract team applies them – as opposed to reading and individually approving NDAs or other standard agreements.

These business challenges and those best equipped to address these challenges all need to be considered in the context of contract management and, for our purposes, in the implementation and management of a contract management system. Once we understand and optimize the focus area for those involved, we then want to review what, if any, steps can be automated.

You guessed it … the focus of our next blog. Stay tuned!

Contract Economics Blog Series

Introduction
Part 1 Focusing the Right Human Resources on the Right Business Problem
Part 2 Leveraging Process and Automation
Part 3 Building a Business Case for a Contract Management System
Part 4 Transforming Contracts into Opportunities

Contract Economics Webinar - Download Materials

Read More
Contract Management Software Blog - Contract Economics: An Introduction
Contract Economics: An Introduction, 09.10.2014

 

​Post by Jasmin Steely, COO, Corridor Company

Contract economics. Piques your interest, doesn’t it?  Though I’d like to take credit, the term is not my brainchild; I first heard it from our CEO and have been intrigued by the concept ever since. So when you think about contract economics, what comes to mind?

Per Webster’s, the definition of economics (I’m a bit of definition, historical reference kind of gal if it isn’t obvious from my prior blogs) is

  1. (used with a singular verb) the science that dates with the production, distribution, and consumption of goods and services, or the material welfare of humankind.
  2. (used with a plural verb) financial considerations; economically significant aspects: What are the economics of such a project?

Considered in the context of the first reference, contract economics conceivably refers to the production, distribution and consumption of contracts. Works for me. Not sure about the reference to humankind – slightly lofty in my opinion. The second reference, the financial considerations of a contract – that is, managing a contract – is spot on. Here at Corridor Company, when we refer to contract economics, we mean the following:

  • Focusing the right human resources – contract managers, attorneys, etc. – on the areas that they know and manage best and on the right business problems. Hearkening back to our studies of economics, I believe that this is referred to as comparative advantage, no?
  • Optimizing the contracting process and using standardization (as appropriate) to help make the process more efficient. In contract management, as in business, time is money.
  • Making the business case for a contract management system. We do, after all, sell contract management software.
  • And finally, transforming your contracts into opportunities. More specifically, how do we transform contract management and the management of obligations from a risk management exercise into one that reveals opportunity. Let’s make economic sense of our contracts.

Four rather lofty discussion points, and the focus of Corridor's next four blogs (as well as a Corridor webinar) affectionately called Contract Economics. We hope you’ll join in the dialogue as it promises to be educational, thought-provoking, and (dare I suggest?) a sound investment of your time.

Contract Economics Blog Series

Introduction
Part 1 Focusing the Right Human Resources on the Right Business Problem
Part 2 Leveraging Process and Automation
Part 3 Building a Business Case for a Contract Management System
Part 4 Transforming Contracts into Opportunities

Contract Economics Webinar - Download Materials

Read More
Contract Management Software Blog - ​Valuable Contract Management Lessons from Down Under
​Valuable Contract Management Lessons from Down Under, 07.25.2014

 

Post by Dermot Whittaker, Sales Support Manager, Corridor Company

Contract managers and procurement professionals will discover much of interest in the New South Wales, Australia, Auditor-General's report on its recent performance audit, “Making the most of government purchasing power – telecommunications.”

The auditors reviewed telecommunications purchasing by six New South Wales (NSW) agencies under the statewide Government Technology Agreement (GTA) in effect from 2007 to 2014, and the new state telecommunications procurement framework which took effect in April 2014. The report found that while “the main determinant of whether agencies achieved value for money is how they managed their procurement processes, contracts and expenses," only one agency did this well and could demonstrate that it was getting value for money.

The Road to Savings – Or Not

The GTA paved the way for savings by establishing standard contractual terms and conditions, and providing for centralized validation of supplier’s insurance coverage. However, to achieve savings beyond the ceiling prices established in the GTA, individual agencies must negotiate with suppliers while employing best practices in procurement and contract management. Some agencies did this, though not consistently. For example, in the case of NSW Fire and Rescue, the performance audit found that “elements of good contract management practices are evident for telecommunications contracts, such as supplier performance reviews, risk assessment and contract reviews. Fire and Rescue has achieved value for money by negotiating a contract renewal with improved services at lower cost, and by leveraging an existing contract to reduce implementation costs in another contract.” But, the report noted, “Fire and Rescue does not have a contract management framework, contract management plan or contract manager assigned for any of its telecommunications contracts.” Without these things in place, the report expressed concern that the savings achieved by procurement could be eroded over time. In a similar vein, the report observed that the Department of Education and Communities “demonstrated that it achieved value for money in its telecommunications arrangements for data services, worth around $67.7 million per annum,” but had “foregone savings in the last three years as a result of weaknesses in its procurement and contract management processes for fixed voice and mobile services.” These weaknesses may have resulted in $2.81 million in lost savings since 2011.

At each agency, the auditors were seeking not merely savings but a consistent practice that would insure demonstration of value for money – a contract management framework. In the report’s words, “Selection and implementation of telecommunications services can result in long term relationships with suppliers beyond the initial contract period. Effective contract management requires an appropriate contract management framework that addresses governance arrangements, skills, roles and responsibilities, and policies and procedures.” One agency, Essential Energy, showed that it had such a contract management framework in place.

How Contract Management Systems Can Help

The NSW Auditor-General's report does not examine the role electronic contract management systems; its focus was on professional practice and the use of frameworks to insure value for money. Indeed, contract management systems cannot replace the professional acumen that led to individual cases of savings at the agencies described above, but such systems can make success more likely. A central repository for contracts makes it more likely that managers become aware of pertinent terms and costs among similar agreements. Ceiling prices can be recorded as such - signaling to contract negotiators and approvers that further potential savings are possible. Managers (whether in procurement or contracts) can use dashboards to assign review of existing agreements to individuals with requisite commercial skills, industry expertise, and awareness of the technical landscape. Periodic review of both contracts and terms can be scheduled to occur automatically, as can review of the market and vendor performance, before the current contract expires.

Of the many areas for improvement noted in the Auditor-General’s report, several could certainly be addressed by a combination of professional practices and a contract management system. Some examples from the report:

One state agency’s telecommunications contract had expired in 2012 and continued to run on a month-to-month basis for years  – often a very expensive mistake. Additionally, the audit discovered that “some of the supplier’s contractual obligations under this contract have not been performed in the last two years.” With a contract management system, contract expiration dates can be used to trigger a reminder to renew or renegotiate a contract well before its end date. Tracking of counterparty obligations can be assigned to staffers with industry expertise. In this case, automating either renewal alerts or obligation tracking might have brought the other issue to light.

Another state agency had failed to coordinate its client agencies’ contracts for mobile voice service. As a result, access cost per mobile voice service varied hugely between separate contracts among the client agencies – with the access cost per mobile voice service varying from $1.29 to $42.10. The report notes, “This variation is related to the volume of mobile voice services rather than location and geographic spread, and indicates there is an opportunity to leverage buying power to get better rates for the agencies in the group with lower volumes.” Isolation of contracts in silos can make it harder to compare costs contract to contract, or even simply to manage such contracts. Use of a contract management system puts this sort of comparison within reach of an observant manager, who can report across contracts and catch the opportunity to leverage an agencies buying power.

A third agency faced a problem of distributed responsibility: having negotiated rates for fixed voice and mobile services for individual schools, the agency relied on the schools to review their monthly invoices and identify errors. The audit report found, however, that the contracting agency “cannot be certain that every school and manager reviews their invoices to identify incorrect charges, to check that cancelled services are not being charged, or whether correct rates are being applied.” With a contract management system, the approved rates could be selectively shared with school personnel, a reminder to compare rates with the invoices (along with procedures for checking cancelled services) generated on a dashboard or sent by email, and – in a SharePoint-based system – a secure site set up for school personnel to actively confirm expenses or enter discrepancies with regard to the contracted rates.

The entire Auditor-General’s report is available online and worth reading for those interested in improving contract management and procurement processes. And for those professionals whose contract management follows the best practices recommended in the report, consider one added value to using a robust contract management system: system-wide reporting on contracts will allow you to demonstrate your success in monitoring compliance to terms and capturing potential savings.

Read More
Contract Management Software Blog - The Costs of Unmet Contractual Obligations: $100 Million in Questionable Costs
The Costs of Unmet Contractual Obligations: $100 Million in Questionable Costs, 06.09.2014

 

Post by Dermot Whittaker, Sales Support Manager, Corridor Company

When contracting errors become public, contract professionals have an opportunity to learn how to avoid similar mistakes. A recent example: As reported in the Washingt​​​on Post*, a United States Defense Department inspector general’s report found that a "major defense contractor 'did not properly charge labor rates' for a counter-narcoterrorism contract, and that the Army agency in charge of the contract did not ensure that the people performing the work had the necessary qualifications." Over $100 million in questionable costs were charged to the government, according to the report.

​​​​​​​ 

Unpacking and unraveling the many sources of alleged overbilling is beyond the scope of this blog. However, several aspects of the report remind us of problems that all contract managers face regarding managing their contractual obligations, problems that contract management systems are designed to reduce or eliminate. 

More specifically:

Problem: Millions of dollars in improper billing by the defense contractor are directly related to inadequate qualifications of the employees who billed for the work. Of 460 employees working under the contract, 360 “did not meet the specified labor requirements, leading to $91.4 million in questionable costs.” In one case, an employee who lacked a bachelor’s degree, a requirement for the position, was responsible for over a million dollars in alleged improper billing. 

Solution: Either party – the service provider or the contracting agency – needs a way to properly manage the contract, surface the obligations, and ensure that the obligations are met. The purchasing party (the Army), at a minimum, needs to identify proof or assurance of employee qualifications as an obligation of its counterparty. The counterparty (Northrup Grumman and its subcontractors) must record the certifications of employees and contractors, and flag those individuals whose qualifications are undetermined, and in turn, fulfill its own obligation to provide assurance of employee credentials. In this case, the obligation is with respect to managing qualifications and billing rates, but obligations can be anything – from reporting on spend under the contract to completing work by a certain date. 

With limited time to check on the sub-contractors and contracted employees, managers need an electronic contract management system that can capture and track this sort of contractual obligation. At a minimum, the requirement to provide properly credentialed employees can be memorialized in an obligation that the service provider meets and the contracting agency checks. In some cases, scans of the relevant proofs of qualifications (such as degrees or certificates) can even be entered in a contract management system as evidence that an obligation of this kind has been met. Ordinary construction contractors track certificates of insurance for their subcontractors every day, often with contract management software. School systems and social service agencies capture credentials and background information for untold thousands of employees working with children, again using electronic tools that allow for reporting and transparency. Sophisticated defense operations, employing similar tools, can do the same.

At a higher level of analysis, according to the same Washington Post article, the Defense Department inspector general’s report "faulted the contracting agency, the Army Contracting Command-Redstone Arsenal, for not verifying that minimum labor requirements were being met and instead relying on Northrop Grumman 'to verify that those employees were qualified to accomplish the required work.'" This criticism points to a fact of life in any contractual relationship: both sides need to track obligations, their own and their counterparty’s. Undoubtedly this kind of mistake keeps many contract managers up at night. With limited time and resources, how many obligations must be verified as complete or met, and how many can be safely assumed to have been met?

Obviously a robust contract management staff with experience and a set of detailed reviewing policies has a better chance of catching this missed obligation than, say, a stretched staff of reviewers with multiple responsibilities. But since time and experience are always in limited quantity, in every organization, it is of vital importance to gain a technological edge on contractual obligations with a contract management system. At a minimum, that system should serve as a single repository for contracts (and also for related documentation from subcontractors and the subcontractors’ employees as they relate to the contract). Ideally the system should allow contract managers to track obligations in a dashboard and be alerted to those (such as proof of employee qualifications) that are unmet. 

By keeping contractual obligations in front of contract managers with assigned ownership and due dates, all parties to a contract stand a better chance of living up to the entire agreement.

* "Northrop Grumman improperly charged government more than $100 million, IG says,​" by Christian Davenport, Washington Post online edition, May 19, 2014.
Read More
Contract Management Software Blog - Preparing an RFP for a Contract Management System: Additional Considerations
Preparing an RFP for a Contract Management System: Additional Considerations, 05.05.2014

 

Post by Dermot Whittaker, Sales Support Manager, Corridor Company

One of Corridor’s most popular webinars this year was “Best Practices for a Contract Management RFP.” In 45 minutes, we shared our experience with RFPs (as well as RFQs and RFIs, what we collectively refer to as RFx) in the contract lifecycle management space. We offered suggestions for determining scope, gathering quantitative data (numbers of contracts, addenda, attachments, reviews, approvals, system users, etc.), requesting (and providing) pertinent information to get an organization closer to a decision, and evaluating contract management vendors’ products and services. We provided examples of useful surveys and evaluation tools.

Within the short time of a webinar, there were some points we could touch on only briefly. Here in detail are some additional considerations for getting the most out of your RFx process.

Don’t Miss a Chance for Improvement

Understanding and mapping your contracting processes is fundamental to preparing your requirements for a contract management initiative. You can use this opportunity to examine what your organization is currently doing and how you can eliminate poor contract management practices. It is not every day that you have the attention of the General Counsel and business users. Some of these professionals are aware of inefficiencies or risky practices that are followed because “it has always been that way.” As long as you are collecting the quantitative information on your organization’s contracts (ideally broken out by buy/sell side, high/low value, high/low risk, time from initiation to execution, etc.), take time to ask users to identify one or two practices they consider sub-optimal. After review, you can selectively weed out some of these poor practices. Why proceed “selectively”? Because changing professional practice is best done incrementally, whether you are adding an automation step or eliminating a duplicative review of boilerplate contract language.

By and large, you should base your requirements on your contracting process as it is so you can review contract management systems that address your particular needs. But, at a minimum, avoid automating existing bad practices in a new contract management system.

Look to the Future of Your Business

Present need is usually what prompts an organization to seek a contract lifecycle management system. Current dissatisfaction creates a desire to replace a current system. Sometimes a sudden crisis (think internal audit) gives urgency to the search. But in preparing the RFP, it is worth considering your company’s – or department’s – future. You are selecting a contract management system that will take time to install, configure and get used to, one that you hope will have a long useful life. The system should have flexibility and potential for growth, ideally on your timetable and with the future configuration under your control. Here are some common areas where looking to the future should shape your requirements:

Contract Volume. You may only want a searchable repository now, but your contract creation needs may change as your business and customer base grow. If your business grows substantially, will this result in dozens, hundreds, or thousands more contracts, with supporting/related documents like NDAs, statements of work, etc.? Will the growth be in high-volume, low-negotiation contracts where contract automation makes sense? Or can you expect growth in highly negotiated contracts where collaboration tools or even a clause library would save on review time and legal costs?

Geography. If US dollars currently make sense for your company’s contract and accounting systems, you may not be thinking about support for other currencies; but if you later develop business in a different part of the world it could become a requirement. Multi-lingual support, especially for contract metadata, could make the system usable for a whole new population of contracting colleagues if your company acquires – or is acquired by – an overseas business entity. Can you look ahead to where in the world your business will operate in five years? What languages and character sets will your overseas staff or clients expect to see as they interact with the CLM system you are purchasing now?

Internal Function and Ownership. Contract management is sometimes a distributed function and sometimes centralized. Regardless of which division or department head is signing off on the requirements in your RFP, will your system have flexibility to survive a reorganization or merging of departments? IT procurement professionals may need different metadata and different review processes for contracts than what you have in mind for the finance department – can the new system accommodate both if you find yourselves sharing it one day?

Integration with Line of Business Systems. Nearly every company has line of business systems in place – the databases and systems for managing accounting, inventory, customer relationships, product service, and sometimes several of these in an enterprise resource planning (or ERP) system. First question: Is your company anticipating a change in line of business? You should at least be aware of any likely change in line of business systems as you frame the integration requirements for a contract management system. Next question: Are you likely to integrate the new contract management system with your company’s line of business system in the future? Your processes may not provide for that kind of contract analysis right now, but your contract managers can tell you whether, in future, integration with line of business systems would help them introduce more value to their contract analysis, purchasing recommendations, and contract metrics.

Senior Management Discussion. As a matter of course, senior executives have an eye to the future. While they may be far removed from the process of selecting a contract management system, it is worth seeking information from them before an RFP is written. Their knowledge of possible directions for the organization – from anticipated internal changes, to overseas expansion and outsourcing, to technical and software purchases – can cue you to look for capabilities and flexibility in your CLM, and avoid conflicts with other systems within the company.

Know Your Partner: Implementation, Training, & Configuration

The software, hosting options, and product features for contract management systems can be compared quite nicely in a functionality matrix, a typical feature of an RFP. It is just as important to develop requirements around implementation of the new system, including its configuration, whether by the vendor or your own people, and necessary training – all of which have costs in time and money. To understand these costs and you should give thought to how you will make a meaningful comparison among vendors. The information you will need (the more specific, the better) includes:

    • How the system will be implemented and how big a role your IT will need to play
    • How the system will be configured to your business terms and processes, with your business logic driving the automation, tasks and reporting
    • How much of the configuration can be done by you and your business users
    • How training is offered
    • How service is rendered

 

One way to get at this information is to include use cases in your RFP. These simple scenarios should draw on your own business requirements for contract management. Ideally questions based on these short scenarios should require specific answers that address technical problems as well as options for architecture and workflow. Answers may show that some vendors are more comfortable talking features and technical requirements than business processes and change management. Others may skirt the hard technical aspects of your questions where every solution has a tradeoff that must be acknowledged and addressed. How vendors respond can also help you develop qualitative evaluations of the vendors themselves.

For readers who are just starting an RFP process, these higher-level RFP considerations may seem a bit pie-in-the-sky. If you just want some direction in getting started, we recommend that you check out Corridor’s recorded webinar “Best Practices for a Contract Management RFP.” The webinar, slide deck, and end notes with poll results and Q&A are available free of charge, on our website.

Read More
Contract Management Software Blog - All Contracts Are Not Created Equal | Considerations for a Contract Management System
All Contracts Are Not Created Equal | Considerations for a Contract Management System, 04.29.2014

 

​Post by Jasmin Steely, COO, Corridor Company

Unlike the famous adage in the Declaration of Independence – "…all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness" – all contracts are not created equal. Given that they are not equal, they do not have the same "rights," nor can they or should they be treated the same way – especially when considering a contract management initiative.

On the surface, this seems fairly obvious. Some contracts are boiler plate, involve little negotiation, and may or may not have a direct impact on company financials. Others are entirely the opposite – they are customized, involve protracted contract negotiations, and require heightened levels of approval. Not only do they impact company financials, but their management, or equally important, mismanagement – can have a significant impact on company profitability. This impact can occur not only on the revenue front, but also from an expense perspective as one considers the risks, penalties and missed savings which invariably happen when they are not properly managed.

As companies enter the realm of implementing contract management systems, the fact that all contracts – and all contract management solutions – are not equal is extremely important. There will likely be a large disparity in the reproducibility, magnitude, management and financial impact of the contracts written by any given company. Unless the contract management system is being implemented to handle only one contract type, considering the differences in your contracts and ensuring that your contract management system can address these differences is vital to the success of the initiative.

When assessing the different contract types and their impact on a contract management system, the following areas should be considered.

Creation

Is the contract boiler plate or will it be highly negotiated? Boiler plate or form contracts which require customization in only specific areas such as company name, address, contract details and governing law are ideal candidates for contract creation automation, a key component for many contract management systems. NDAs – which within many companies comprise a high percentage of the contracts signed on a daily basis – are ideal candidates for contract creation automation.

Negotiation

Contracts which require high levels of customization and negotiation may not be ideal candidates for contract creation automation. This does not mean, however, that they shouldn't be managed or that their needs shouldn't be considered when analyzing requirements for a contract management system. Contract negotiation includes the exchange of numerous versions of the contract. Throughout the repeated exchange of changes and suggestions, redlining may or may not be turned on, the final version of the contract may or may not be stored in the repository, and approved language may or may not have been included. A robust contract management system should be able to address the need to manage these customized, heavily negotiated contracts, before and after their execution, even if the system is not used to create the contract in the first place.

Approval

Different types of contracts will require different types and levels of approval. Such levels of approval may be related to properties such as the contract's value, whether the contract is buy side or sell side, jurisdiction and geography, product/service type, or the language changes which are made to the contract. Regardless of the contract type – form or highly customized – contract management systems should be able to accommodate the different approval levels and cycles which must be considered throughout the contract negotiation and approval process.

Search and Reporting Requirements

Search and reporting requirements for contracts may be as simple as creating searches, alerts and reports on contract expiration dates to highly sophisticated tracking mechanisms which ensure that contract obligations, whether financial or simply contractual, are met.

Integration Points with Other Enterprise Applications

Closely related to reporting requirements is the ability for the contract management system to integrate into a variety of different back-end systems including ERP. Managing certain contracts to best advantage depends on real-time information (such as contract spend) from such back-end systems.

All contracts are not created equal – nor are all contract management systems. When selecting the contract management system which best fits the needs of your company, be sure to consider the variety of different contract types which exist within your company and the management needs of these contracts. The "….Life, Liberty, and Pursuit of Happiness…" of your contracting folks – which your contract management solution will likely impact – should not be overlooked!

Read More
Contract Management Software Blog - A Contract Professional’s Untold Story – Value!
A Contract Professional’s Untold Story – Value!, 04.14.2014

 

Post by Russ Edelman, CEO, Corridor Company

We have had the opportunity to work with contract professionals in all parts of the world. While cultures and personal styles vary considerably, contract professionals show a common desire to introduce value into their respective organizations as they manage the complexities of contracts. And while they succeed in introducing value every day, that value frequently goes unrecognized. As a result, our beloved contract professionals often become corporate martyrs rather than corporate heroes.

 

What is a corporate martyr? A person who is so selfless on behalf of their organization that they compromise their own personal well-being for the sake of their businesses. The corporate martyr is typically a hardworking professional who suffers in silence when they could make their case with a few metrics and a conscious, proactive approach.

Conversely, the corporate hero brings heightened value to the table while maintaining integrity and a sense of balance.

We have found that many contract managers avoid martyrdom by representing their value proposition effectively and in different ways. Here are three focus areas that can transform contract managers into heroes.

You Are the Connector | Whether on the buy side or sell side, you serve as a primary business liaison for your organization. By establishing a trusted relationship with your trading partner, you are both a gatekeeper and an advance scout. Beyond your normally rigorous contract management function, it behooves you to pursue new opportunities and to proactively mitigate risk associated with the contracts. Invest time in the key partners to understand what drives them and how mutually advantageous and vested outcomes can be derived. This perspective is especially valued on the sell side where you may be able to open doors that otherwise were unknown or closed.


Your Metrics | For most organizations, getting contracts into a managed and centralized repository is a huge win. You need to take your game up a notch to have a more substantive and demonstrable impact. This means providing quantitative metrics on your performance. In terms of contracts, this typically translates into monetizing the opportunities that you have uncovered in your role as Connector. It also means quantifying risks that you have helped the organization to avoid and providing corresponding monetization figures. Ancillary metrics come into play such as contract consistency, amendment volume and team size/cost associated with the CLM process.


Benchmarks | Engaging with professional member associations such as IACCM or getting together on a regular basis with professional peers can prove invaluable when you need to provide your executives with data on comparable organizations. Executives are regularly looking at how they fare relative to their corporate peers, the Joneses next door. Provide executives with a grounded and quantitative way of comparing and interpreting results and it will make a difference in your own value proposition. In addition, speaking with confidence about the best practices employed by a respected competitor’s contract management team can help manage change in your own work group and give your own corporate leadership some needed insight.

On a final but no less important note, know your audience and calibrate accordingly. If your executive team is into the details, keep your figures and estimates conservative. If the team wants the big picture, stay away from the minutia, but have supporting details ready for when an explanation is required.

We often hear from contract managers who have adopted one or more of these approaches with success. Here’s hoping that these insights prove useful to you as well on the road from corporate martyr to corporate hero!

Read More
Contract Management Software Blog - Contract Managers and IT Need to Ask: Should I Migrate Existing Content into My New System?
Contract Managers and IT Need to Ask: Should I Migrate Existing Content into My New System?, 04.03.2014

 

Post by Aaron Cutlip, Chief Technology Officer, Corridor Company

A typical decision point when implementing any new document management system revolves around what to do with the documents and content from the previous system. In a perfect world, all of the old content comes along for the ride and works perfectly in the new system with little to no effort. However, let’s talk about the reality of migrations and leave “perfect” out of this discussion. The purpose of this post is to frame out the points that should be considered when deciding if you should migrate anything and what migration strategies you might use.

Migration Considerations

Do you have experts on staff?
You should really think about the expertise of your staff. To successfully pull off a migration you need experts that know both the old system and the new system and will be able to overcome the obstacles that they will inevitably run into.

What is the budget and timeframe for the migration?
In many cases, there are deadlines for when content must be moved due to software licensing/expirations, budgetary reasons, or other factors. If you face time constraints, be forewarned that until you get to the stage where you are running trial migrations, it is very difficult to know what gotchas are going to spin your estimate out of control. If you have the budget, it may be wise to hire an outside consultant/expert who can lessen the risk of these gotchas.

How will you get the data/documents out of existing system?
Depending on the system previously used you might have an API available that you can utilize in an export script, or the system might have some kind of “export” functionality that dumps documents to the file system and metadata to a flat file. You might even have some software tools that allow you to retrieve this data. As you evaluate your options, consider purchasing a tool to assist in the migration, but be aware that no tool will do everything; you either have to live with that or be willing to write scripts to make up the difference.

Will the information architecture/data structure change from the old to the new system?
When a new system is implemented, typically it is your opportunity to change things to reflect new capabilities of the system and to reflect changes in your business process. This typically means that the data that was captured in the old system does not always line up with the data in the new system. So if you migrate the old data to new, how will you deal with this mismatch?  Is it possible to map old values to new?
 
Do you need to migrate all of the content or just some of it?
Unless you have been using retention schedules in your existing system the chances are good that there may be a lot of old/archived content that is not worth moving. You must consider whether this content can remain in the old system or if it can be exported to some offline type storage. Obviously this is also a good time to consider retention schedules for your new system.

Migrations Strategies

Now that you have spent some time thinking about some of the migration considerations, what types of migration strategies might you use?

Day Forward Strategy
In a day forward strategy, you leave the old content in the old system and start using the new system for any new content starting on the day it launches. Typically you would put the old system into a “read-only” mode. You could implement a procedure in which, if old content needs to be worked on, the user will pull it out of the old system and manually put it in the new system. This strategy is good when the content is cyclical with some type of renewal activity that happens on a periodic basis. Over time the content will be manually moved over. Additionally, you might be able to allow searching the old system from the new system to lessen the burden of retaining both systems. While this is obviously not a migration it can be a time- and money-saving approach that is worthy of consideration.

Full “Big Bang” Migration
A full migration, as the name implies, is where you move everything. This is the approach that most business people assume will happen when they start talking about the new system. It is important to understand the considerations outlined above and have dialogs with the users of the system to understand if a full migration is truly needed.

Migrate Only Active Content
By migrating only the active content you are lessening the volume of data that will populate the new system. This approach does not necessarily make the migration easier since you still have to deal with how to move the content; however it prevents the new system from being populated with invalid/unused content.

Migrate into a “Legacy” Area
If the information architecture/data structures between the old and new system are very different one approach is to create a “Legacy” area within the new system. In this approach, your new system would have an area or library setup that contains a structure that mimics the metadata and values of the old system. This makes the migration easier because you don’t have to have complex mapping rules between the old and new. This legacy area would be made read-only and any new content would go into a new structure. This approach allows the old system to be taken offline but users still need to think about the fact that content created before a certain date may be found in the legacy area.

Hire a Temp Agency to Manually Migrate
This approach may sound crazy, but the reality is that migrations are hard. During your investigation, always consider that fact that all of the work you put into automating the migration is typically a one-shot effort that is not used after the migration is done. You might consider automating part of the migration that is easy, but then having lower cost labor handle some of the data population. This approach works well when you can setup explicit rules that the temp agency can follow.

Conclusion

The main point of this post is that migrations are not easy. They are full of “gotchas” that can blow your time estimates out of the water. As I said previously, no migration is perfect so be willing to deal with some compromises. Where possible try to simplify your approach and educate the users on how the migration might work. In most cases the users are willing to work with you on creative solutions you might have as long as you are not increasing the  effort required to perform their daily duties. Finally, as you design your new system, spend some time thinking about the fact that eventually it will be replaced and you will yet again have to consider your migration options. Is there anything you can do now to make your next migration easier?

Read More
Contract Management Software Blog - Winning Hand: Our Thoughts on SharePoint Conference 2014, Las Vegas
Winning Hand: Our Thoughts on SharePoint Conference 2014, Las Vegas, 03.19.2014

 

​Post by Russ Edelman, Aaron Cutlip, Bob Long, Anh Hoang Nguyen, Dermot Whittaker, Christina Ryan

Corridor Company participated in Microsoft’s SharePoint Conference 2014 (SPC14), March 2-6, 2014, at the Venetian Hotel, Las Vegas, Nevada. How was the conference? What were the stand-out sessions and key takeaways? Here are some thoughts from the perspective of Team Corridor…

 

Russ Edelman, CEO, Corridor Company

The keynote presentation set the stage for the rest of the conference on three key fronts. First, Microsoft’s move to the Cloud and specifically, Office 365 and Azure, is a critical path for Microsoft. This focus sets the stage for a much more agile rendition of the company. Second, they are keenly focused on the user experience and making information as relevant as possible for each respective consumer. Third, the transition to using SharePoint and/or Office 365 as a critical business platform is very real, and organizations of all sizes are betting the bank on Microsoft. The conference and SharePoint’s continued success are well-aligned with Corridor’s laser focus on SharePoint as a mission-critical platform. This allows us to plan for and evolve our product roadmap in accordance with our conference findings. An important note shared by key Microsoft executives is the transitioning role of SharePoint IT Pros. With the aggressive movement to the cloud, expertise related to the build-out of SharePoint farms and other related “infrastructure” tasks will be less in demand. This should be considered from a career-planning perspective.

 

Aaron Cutlip, CTO, Corridor Company

There were many sessions that focused on the tools and technologies needed to build applications for SharePoint 2013 and Office 365.  While many of these sessions had some overlapping content there was a different focus to each and different examples that really allowed the audience to understand and learn how to build these apps.  In particular, session SPC385 "Building SharePoint Apps with Windows Azure Platform as a Service" by Kirk Evans really stood out as a great example of how powerful the new cloud-based development model is and how this is changing the way applications are built. The tools and combination of Office 365 and Windows Azure allow developers to focus on creating solutions without having to worry about the server infrastructure and performance constraints that normally require a lot of consideration. The ability to simply change some settings on the dashboard pages to scale an application on a global scale is truly amazing.

Obviously there were a lot of technical details from the sessions at SPC14; however, the most critical point learned is around Microsoft’s commitment to its cloud strategy. There were literally no sessions that I am aware of that focused on on-premises applications. In the future it would not surprise me to see a release of SharePoint that is only available online.

The moves to cloud-based applications and data hosted in the cloud are significant shifts in the industry that open a new wave of opportunities for businesses to build new tools and software.  Smaller companies that are more agile in their ability to deliver high-value software quickly can grab and hold market share typically held by more traditional software companies. The move to the cloud allows both small and large companies to invest in software and services as opposed to complex hardware and network infrastructures.  Instead large capital expenditures companies can incorporate subscription costs into a predictable operating budget. Additionally, companies can take advantage of the expert knowledge Microsoft has around how to properly manage and maintain the environments and software without having to train personnel or spend valuable IT budget in order to do this.

 

Bob Long, Corridor Company

One standout session was SPC2015 "Introducing Codename Oslo and the Office Graph" presented by Ashok Kuppusamy and Cem Aykan. Microsoft is using the Office Graph technology to reinvent search and discovery with a new user-focused tool code-named Oslo. The tool works like a network where it actively seeks and displays information from multiple sources that is relevant to the active user. Information is beautifully displayed in Oslo using a “card” like metaphor where each “card” has a picture, title, and summary, so that users can quickly grasp the importance of the information. Users who are interested in the information click on the card to get additional details, no matter where the data resides. Oslo is fully security-trimmed so that users see only information that they have access to.

This technology has the potential to change the classic browse-and-search-for-information paradigm to a new model where the information finds appropriate users. This shift could have a major impact in the way contract managers receive contract information. One can imagine leveraging these technologies to deliver relevant contract information to business users without their having to seek out the information. It would be like getting the “Contracts Daily” newspaper where information is always fresh and relevant to each user.

 

Anh Hoang Nguyen, Senior Developer

The most impressive session to me was SPC385 "Building SharePoint Apps with Windows Azure Platform as a Service" presented by Kirk Evans. It showed how to properly and quickly develop a SharePoint/Office 365 app, taking advantage of Windows Azure. Kirk did a very good job giving us a hands-on demonstration and also went deep, explaining what capabilities Windows Azure has to offer.

SharePoint developers can appreciate the power of Windows Azure. In my mind, SharePoint apps with Windows Azure is a deadly combination. Windows Azure frees developers from the burden of maintaining infrastructure. Developers can deploy their application and the rest (scaling, availability, etc.) will be taken care of by Azure. This lets developers focus on delivering innovative solutions that can be leveraged around the world.


Dermot Whittaker, Sales Support Manager, Corridor Company
Christina Ryan, Project Manager, Corridor Company

Our view from the Exhibit Hall: interest in and commitment to SharePoint by attendees, session leaders, and sponsors alike. SharePoint is a platform for cooperation, after all, and the conference community seemed to be all about learning. Any user could strike up a conversation on an aspect of SharePoint outside his or her area of expertise and come away informed, excited, and ready to explore and learn more. During session breaks and special events (including the Welcome Reception on Sunday, Club SPC on Monday, Las Vegas Motor Speedway Attendee Event or Tuesday, and Ask the Experts on Wednesday) the exchange of information with attendees was easy and relaxed. Not surprisingly, we spoke to many business systems analysts and managers about Corridor’s Contract Management Business App for SharePoint – CM[.app] -- and Corridor’s various Extender Apps, including our Integrate[.app] for SalesForce. WE had some eye-opening conversations with SharePoint developers, introducing them to Corridor’s SharePoint Process Engine that allows users to readily configure custom conditions and actions within SharePoint without the extensive, time-consuming coding normally associated with these efforts.

A high-point for Corridor Company occurred on Day Four of SPC14 in the Partner Theatre session “British Telecom Improves Business-Critical Contract Management Processes with CM[.app].” In this case study, Corridor's CEO Russ Edelman described BT's use of CM[.app] to provide BT with critical contract management functionality to readily access their LOB data,  improve decision making, and reduce business risks.

A Microsoft Gold Partner, Corridor Company is also a member of Microsoft’s Business-Critical SharePoint program which highlights uses of SharePoint for business-critical purposes.

Read More
Contract Management Software Blog - Document Automation beyond the Contract and Why Richard Susskind Is Right On!
Document Automation beyond the Contract and Why Richard Susskind Is Right On!, 03.11.2014

 

Post by Russ Edelman, CEO, Corridor Company

As I made my way to the Microsoft SharePoint Conference 2014, I began my dive into Richard E. Susskind’s latest book Tomorrow’s Lawyers: An Introduction to Your Future. The book is a must-read for anyone in a legal department or law firm. However, the subtext, IMHO, has relevance well beyond those who practice law. I would argue that the spirit of the book is all about adding value in new ways. Mr. Susskind’s Tomorrow’s Lawyers: An Introduction to Your Future by Susskind (2013) Cover image by permission of Oxford University Press. basic premise is that lawyers must relinquish their dated practices of billing by the hour and instead look for collaborative and economic ways to help both firm and client.

Why do I bring Professor Susskind into the fray? Well, throughout the book, he references disruptive technologies for attorneys and the first on the list is document automation, the ability to automatically generate documents (typically contracts) based on a person’s completing a simple form.

For purposes of disclosure, Corridor has a robust document automation tool called the Contract Creation Module (CCM). I would personally argue that CCM takes the longstanding concept of document automation and makes it a very modern and useable experience, unlike the legacy automation tools of the past. But whether the automation product is ours or one of the other vendor's, there is a preconceived misperception, not even identified by the big R (Richard), that automation is all about the contract, not its many vital supporting documents such as amendments, exhibits, and addenda. And these documents are all excellent candidates for automation.

Undoubtedly, contract automation is a powerful value-add for the right contract types, and I do stress: the right contract types. When contract volume is high, when negotiations are typically low, and when the language in the contract can be easily variablized (real sounding but non-existing word), automation is fantastic. Examples may include NDAs or standard service agreements, where automation is a great fit.

However … grant for a moment that some contracts need to be hand-crafted, that their complexity calls for the artisanal approach many lawyers take to framing them. Behind even these contracts are all of the supporting amendments, exhibits, addenda, etc., that do much of the heavy lifting in contractual relationships. The data that drives the variables in the supporting documents probably exists in a master record as well. And it is here that organizations can further leverage their automation technology, where the supporting documents offer some substantive low-hanging fruit.

How about a case in point? One of our clients, a national health care provider of the “bluest” kind, has been successfully using our software for a number of years. On an annual basis, they have a need to amend the standard contract for thousands of providers. This process involves the creation of a separate cover letter, amendment text, and signing process for the provider. Enter automation and electronic signature, and see how the picture changes. Rather than creating a custom “package” for each provider, our client quickly sets up a CCM template, points it to the existing contract database, configures the process and includes DocuSign for electronic signature. The outcome: thousands of documents are automatically generated and sent via DocuSign for signature. The fully executed documents are then stored back into the system. What would have taken months of work, along with the pain of follow-up, is now configured and managed with two to three days of effort. And even without their use of e-signature, their process would be greatly streamlined and less error-prone.

To borrow a term from Richard Susskind, that’s some disruptive value!!

(Image by permission of Oxford University Press.)

Read More
Contract Management Software Blog - How to Restart the Central Administration Service in SharePoint 2010 with the Power of PowerShell
How to Restart the Central Administration Service in SharePoint 2010 with the Power of PowerShell, 02.27.2014

 

Post by Michael Ouellette, QA Engineer, Corridor Company

Many of us know PowerShell is capable of amazing things when working with SharePoint. We should keep this in mind when we get ourselves in trouble and don’t know where to turn. Consider the following example in SharePoint 2010:

Have you ever needed to restart a service in Central Administration? Of course you have! You navigate to Central Administration -> Manage Services on the server. You stop the appropriate service and, when the page refreshes, you start the service. Sounds simple enough.

Have you ever accidentally stopped the Central Administration Service? If you do you might be startled to see the screen shot below when your page refreshes:

 

You might think to yourself, “This can’t be good.” It’s a frustrating situation. In order for the Central Administration page to load you have to start the Central Administration Service, but you cannot get into the Central Administration page to accomplish this task. So how will you ever get Central Administration back?

Don’t worry – there is a simple solution and an opportunity to have fun with PowerShell! Open up the PowerShell command window (the SharePoint 2010 Management Shell) and use the following command:

Get-SPServiceInstance | Where-Object {$_.TypeName –eq ‘Central Administration’} | Start-SPServiceInstance

This should bring your Central Administration Service back up and you should be able to access Central Administration. If you try this and you still cannot access Central Administration then it is possible your SharePoint Timer Service is not running (check Administrative Tools -> Services on the application server). You can check the status with this command:

Get-SPServiceInstance | Where-Object {$_.TypeName –eq ‘Central Administration’}

The status before you run the command will be “Disabled”; the status will change to “Provisioning” and finally to “Online.”

So once again PowerShell gets us out of a jam and reminds us it is worth spending a little time familiarizing ourselves with such a powerful tool.

Read More
Contract Management Software Blog - Practice Makes Perfect | How SharePoint Can Help with Change Management
Practice Makes Perfect | How SharePoint Can Help with Change Management, 02.10.2014

 

Post by Steve Goodrich, Director of Consulting, Corridor Company

For many people, learning a new technology while also refining business processes is a daunting challenge. There's good news to report, and the news is that SharePoint can help! Utilizing a SharePoint project collaboration site to help manage the project enables team members with a range of SharePoint experience (from none to advanced) to learn the platform's capabilities before they start to use it as a core part of their business operations. Implemented wisely, this approach can flatten the learning curve while enabling team members to communicate SharePoint's capabilities and benefits to the rest of the organization.

For example, project-related documents can be stored in a document library and versioned so that a history of the project's deliverables can be maintained. Document approval workflows can also easily be implemented, to help with the approval lifecycle and auditing. Managing documents this way helps team members learn about versioning (check-in and check-out), approval workflows, content types and metadata for the documents they are managing.

Here's another example: Adding SharePoint lists to manage project risks, issues, and tasks not only helps the project team manage these important project items, but also furthers team members' learning about SharePoint capabilities such as metadata and column type management, list view creation and management (including datasheet views for bulk updating) and the use of SharePoint alerts to notify users when list items have changed.

These and other capabilities are easy for the project teams to implement and use.  If implemented properly, they can help team members become more educated about benefits they can expect to realize from the SharePoint platform once their project has gone live. With change management such an important part of any implementation project, SharePoint's strengths and best practice should be leveraged right from the start to help the project succeed.

For all these reasons, utilizing a project collaboration site has become standard operating procedure at Corridor. We manage numerous concurrent projects of varying size and complexity for our clients, and every one of these projects utilizes a collaboration site. Many of these projects involve the implementation of our Contract Management Business App for SharePoint, and all of them involve SharePoint as a key platform component. In this case, practicing what we preach is important – because it really does work!

Read More
Contract Management Software Blog - SharePoint 2013 and Web Designers: Friends or Foes?
SharePoint 2013 and Web Designers: Friends or Foes?, 01.15.2014

 

Post by Tim Arnett, Developer / Webmaster, Corridor Company

Friends? The answer is an emphatic yes! With software in general, if you don’t like the way it looks you’ve just got to deal with it, branding notwithstanding. Not with SharePoint: if you don’t like it you can mold it into whatever you want it to look like with some simple CSS. Anything: with CSS you can change the way links look, the way they behave, you can change a specific link, add effects, modify colors, images, sizes, borders, shading, shadows, spacing, margins, padding, anything! SharePoint includes an OOTB method to achieve this as well, with the Content Editor Web Part. Add it to any page, edit it and insert any CSS. SharePoint will even "fix" your broken CSS. 
 
If CSS isn’t your game, then Javascript is your fame. And with new libraries like JQuery, it’s essentially like fancy CSS. Then comes the fun part, grabbing objects’ parents, and changing the way a whole page looks by clicking one button. The most web-design friendly part about SharePoint is that the entire concept of SharePoint is basically wrapped around a website’s frame. Since anyone accessing a website needs to have read-access to the source code, SharePoint is virtually open source! You can overload Javascript, add code, remove it, change visuals, or make pretty much any change you might want to make!

So yes, SharePoint and Web Designers get along just fine; in fact, we go hand-in-hand.

Read More
Contract Management Software Blog - SharePoint as a Platform for Contract Management?
SharePoint as a Platform for Contract Management?, 10.28.2013

 

Post by Jasmin Steely, COO, Corridor Company

​SharePoint has proven itself a platform for many things – websites, intranets and a variety of business-critical applications. While it has out-of-the-box contract management functionality, can it – or should it – be considered as a platform for a robust contract management solution?

Putting aside our bias, our response is emphatically YES! …but, with a few caveats…read on!

 

When assessing SharePoint’s applicability as a platform for a robust contract management system, there are areas which need to be examined. 

  • SharePoint as an Information Management Platform
  • SharePoint’s Scalability
  • SharePoint’s Native Contract Management Capabilities

Information Management | When considering SharePoint as an Information Management Platform for contracts, its document management functionality with centralized and distributed repositories, full version control, security, check-in and check-out, rich metadata and basic search provide a solid foundation. Workflow functionality is present allowing documents to be routed for basic approvals based on metadata, and collaboration is facilitated with SharePoint’s information sharing capabilities, knowledge management and expertise finder functionality.

Scalability | The approach employed for SharePoint scalability is similar and dissimilar to non-SharePoint environments. Yes, a play on words; however, a true statement. In terms of similarities, the notion of scaling SharePoint correctly requires careful design and planning, testing and accommodations for third party product dependencies and complex Line of Business integration. If this careful design and planning does not take place, be ready for a mediocre implementation. In terms of where it is dissimilar, SharePoint is by design, a stratified repository. Content can be stored in stratified locations which are geographically, physically or logically segmented. This allows for the load of the content to be distributed which requires different factors to be considered when designing a SharePoint-based system. With this stratified framework, coupled with a solid “standards” or “governance” plan, SharePoint has the ability to scale well beyond its silo-oriented counterparts. It is one of the reasons why SharePoint has become so incredibly popular.

What’s missing? | Depending on your needs, maybe not much. At a high level, while SharePoint does provide document management, workflow and collaboration capabilities, it does not provide document assembly, eSignature support, clause access, automated reporting or scanning. Metadata search tends not be great, workflow is too generic, and the ability to exchange information externally in an efficient manner is limited.

So, while it provides basic out-of-the-box contract management functionality, a robust contract management lifecycle application it is not. It does, however, provide an outstanding platform which can be leveraged. And, given that SharePoint exists in many if not most companies, further leveraging the additional functionality becomes an easy business decision. Users are already familiar with the platform, the existing infrastructure can be leveraged, and IT need not support another silo of information. 

And, when coupled with a product like Corridor’s Contract Management[.app]™ for SharePoint or CM[.app], SharePoint provides an extremely powerful platform for contract management. Contract creation can be readily automated; negotiation is easily accommodated through automatic redlining capabilities, email collaboration and check-in check-out functionality directly to the repository; and workflow and approvals can be routed based on a wide range of criteria. Approved contract language can be inserted throughout the negotiation process and high-risk language or obligations can be readily extracted – for purposes of both approval and tracking. Contracts can be signed via electronic signature with storage taking place in one centralized, searchable repository. Post contract management can be easily achieved with a wide range of customizable reporting and searching capabilities. And the application can be integrated into most Line of Business Systems as well as Salesforce.com!

For additional info, please contact us! Also, feel free to check out one of our more recent webinars on the subject – recorded and made available for your post webinar reference!

Read More
Contract Management Software Blog - IACCM Americas | October 8-10, 2013 | Reflections on One More Great IACCM Event
IACCM Americas | October 8-10, 2013 | Reflections on One More Great IACCM Event, 10.24.2013

 

Post by Russ Edelman, President & CEO, Corridor Company

We recently returned from our sixth IACCM Americas Forum which took place in beautiful Phoenix, Arizona. The conference had a few hundred contract professionals from many of the largest organizations in the world, and as is the case with prior IACCM conferences, the knowledge exchange among the attendees was of incredible value. Coupled with the attendee networking, the conference of course had multiple tracks with numerous contract-related sessions. While I speak with bias as we are fans of IACCM, the IACCM conferences are the best professional association conferences I have attended.

So, one might ask why I make such a bold statement as “the best…” Let me share four brief points of reflection:

  1. IACCM Passion for the Members | The entire team at IACCM is deeply impassioned with the importance of the contracting process and the impact that it has on the business world. IACCM is led by CEO Tim Cummins, whose interest and expertise on all matters related to the world of contracting is unprecedented. His team shares a similar perspective, and one of the unique aspects of this group is that they excel in aggregating expertise when they don’t possess it themselves. This really raises the value proposition for IACCM as they know so much about the subject and bring in other experts with complementary and, at times, alternative perspectives. This only helps to provide more stimulating dialog and thinking.
  2. Attendee Exchange of Information | By design, IACCM leads the way in providing an active assortment of session types which stimulate exchanges and dialog among the members. For example, they combine multiple round-table sessions to examine key topics with the practice of group rotations to keep the exchanges and introductions of people moving. They also do a great job with the keynote speakers and in this case, one of them was Donna Messer of ConnectUs. She served as a great catalyst to push people into exchanging more information and learning how they could help each other.
  3. Quality Content & Expert Speakers | Donna Messer’s networking keynote notwithstanding, IACCM downplays and/or simply outlaws speakers from the vendor community to protect the members from inappropriate pitches. Some of the vendor speakers have earned their stripes by speaking with honest and unbiased perspectives; however, the majority of speakers at IACCM conferences are contract management practitioners that are talking up the good, bad and ugly with their experiences.
  4. Fun Dinners & Great People | This year’s dinner on Wednesday night was a friendly, relaxing break from the three days of sessions, lectures, and workshops. Conference attendees enjoyed the mild desert air at an evening barbecue (with a burro to greet guests, including Corridor Company's Dermot Whittaker, shown above wearing hat). This is typical of the informality and fun that IACCM brings to the serious work of contract management.

 

So, for the IACCM-uninitiated, I’d recommend that you take a hard look at this organization as they really can play a key role for contract professionals.

Russ Edelman

"Tim Cummins Fan # 1"

Read More
Contract Management Software Blog - Protect Users from Themselves: Revoke Their Right to Delete
Protect Users from Themselves: Revoke Their Right to Delete, 09.26.2013

 

Post by Peter Dorfman, Principal Consultant, Corridor Company

Here's an issue I've always had with SharePoint -- or rather, with SharePoint as it usually has been implemented at client sites.

Every site you set up has certain default permission levels, the most commonly assigned being "Contribute." You have to have Contribute rights to add or edit anything to a list or a document library, so if you have a Practice Group or Community SharePoint, most of your users will have Contribute rights. By default, all "Members" of your site get Contribute rights.

BUT, the Contribute permissions level also allows people to delete things. This really worries me as an administrator. Having to delete something is a relatively rare event, and accidental deletions result in data loss. If it were up to me, all SharePoint sites would be set up to exclude delete rights from the Contribute permissions level. (If a user absolutely needed to delete something, he or she would have to request this, but that little annoyance is more than made up for in better data integrity.)

You can revoke Contributor permission level delete rights in your own SharePoint site, and in my opinion you should. Here's how:

  • Go to Site Settings. You must make this change at the top (site collection) level. If you are not there, then under Site Collection Administration, click "Go to top level site settings."
  • Under Users and Permissions, click Site permissions.
  • On the Ribbon, upper right, click Permission Levels.
  • You will see a list of possible permission levels in your site. Click Contributor to modify that level.
  • Under List Permissions, uncheck the boxes for Delete Items and Delete Versions. Then click Submit.
Read More
Contract Management Software Blog - SharePoint is Social; Are You? Corridor Company Now Is!
SharePoint is Social; Are You? Corridor Company Now Is!, 09.18.2013

 

Post by Russ Edelman, President & CEO, Corridor Company

Social Photo.jpgOn behalf of the Herculean efforts of a few key folks here at Corridor, I wanted to provide the appropriate kudos to thank those in the know for getting our corporate blog up and in action!  Yes, a long time in coming; however, we have found that its importance cannot be understated as a complement to our other thought leadership, communications and research.  And, in this regard, I guess you could consider us just a bit more social!

On a more focused note, as we become more social, we thought it appropriate to dedicate our first blog to the social capabilities available in SharePoint 2013 -  and to discuss how to leverage these within your organization.  As Microsoft continues to further weave Yammer into the social fabric of SharePoint, these capabilities are becoming quite potent and powerful.  Additionally, SharePoint has introduced greatly improved User Profiles, My Site capabilities, microblogging, alerting on much more content, and a variety of other important capabilities.

To learn more about SharePoint specifics, I'd recommend you check out the TechNet link for more information.  You can also learn more via a great new book titled Essential SharePoint 2013 written by our great friends, Chris Bortlik, Scott Jamison and Susan Hanley.

Now, on to the meat and potatoes of this, our first blog!  Is Your Organization Social?  Or, more specifically, is your organization using social tools that are linked into your corporate footprint? Yes, most if not all professional folks typically participate in Linked In, Facebook and other such communal/ social platforms.  However, has your organization embraced such tools as SharePoint or other corporate platforms?  Unfortunately, we find that the answer is typically "no", and if "yes", only a partial "yes". As much as we would all like to see our organizations embrace these tools and fully integrate them into our corporate culture, they are not.  However, with some careful guidance, discipline, and continued commitment, you can help your organization turn the corner.  Here are a few key steps to consider as you forge ahead with this endeavor.

Business Success - Not Just a Technical Success | The fundamental message here is that you may have the best SharePoint technologies (or other social technologists) in the world - and, they may install and optimize SharePoint perfectly so that it is undoubtedly a "Technical Success" - however, this does not mean that it is a "Business Success".  For it to be considered a "Business Success", the organization, the people, and the culture must embrace and perpetuate the system such that the technology is, in many respects, an afterthought.  Once accomplished, knuckles, high fives and kudos all around - as this is a difficult win to get under your belt!

Communities of Purpose - Not Communities of Interest | Tools such as SharePoint demand a different approach in comparison to their public brethren.  The adoption of such technologies should be very purposeful; they should be time bound, properly facilitated and should have measured outcomes.  This approach is much more focused than the "cloud" orientation of public social platforms.  In some cases, it may make sense to integrate these together.  This concept of Communities of Purpose is elaborated upon in much greater detail in an article that I co wrote in Information Week with Mary Lou Tierney.  Please feel free to check out the link should you want to shed more light on this topic.

Rifle - Not Shotgun | The worst thing you can do is to just stand up SharePoint or your other social corporate tool for mass consumption.  Get smart about it - target it for a specific purposes (see above!) and then publicize the heck out of it for all the right reasons.  As you do so, learn from what went right, and as important, what went wrong, and then take on the next group.  If you take this baby step approach, you'll find that demand may quickly exceed supply!

All for now - hope this sparked some interesting thoughts for you and stay tuned for our next piece!

Also, if you need anything or would like to discuss, please feel free to shoot me an email at russ.edelman@corridorcompany.com.

Happy blogging!

Russ


 


 

Read More
Contract Management
SharePoint
"
Contract managers work the tools that facilitate all businesses everywhere. If they have a contract management system that empowers them, their expertise and knowledge of the contracts’ uses and terms can grow.
"
Dermot Whittaker, Corridor's "Contract Economics" blog series