Webinar Recap: How to Expertly Manage Contracts at Scale

Contracts are the lifeblood of any business. They serve as the business's foundation and fuel its growth. However, many companies fail to properly optimise their contract processes, wasting time, costing money, and limiting business growth.

In this webinar, Roisin Noonan, Chief Commercial Officer at TLB and co-founder of oneNDA, explores how to effectively manage your contracts better so you can be more efficient, effective and productive as a contract management function. She unpacks the entire journey companies need to take: from a reactive state to achieving a fully optimised and efficient contract management function.

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Building a highly efficient, effective, predictable contract management function

Contract management, especially in an enterprise setting, poses a multifaceted challenge. Building out the most efficient contract management function, covering all aspects of contract creation, review and negotiation, signature and storage and ongoing contract management is challenging enough, let alone coupled with the compliance obligations and governance frameworks enterprise contract managers must navigate.

As a result, many organisations hover around the 'aware' stage of the contract management optimisation scale.

Your business must undergo a transformative journey to transition from the 'aware' state to the highly coveted 'optimised' state. This journey involves:

• Strategy. Having clear objectives for your contract management function, which align with your business objectives and a plan of how to achieve them.
• Operationalise. Setting yourself up for success to deliver on that strategy.
• Document. Documenting your new processes to achieve ongoing operational excellence.
• Data. Leveraging data within your function to measure performance of your strategy and fundamentally demonstrate the real value your legal and procurement functions are delivering for the business.

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1. Strategise

First thing’s first: you need to establish clear objectives and put in place a plan for how you’re going to get there.

For example, if your business’ objective is to hit a certain revenue target by the end of the year, your objective as a contract management function might be to cut the time it takes you to contract by 50%.

You then need a plan for how you’ll achieve that objective. That involves talking strategically and critically about the resources available to you and how you’re deploying them, and determining whether you’re doing so in a way that facilitates you meeting your objective.

Here’s how you can think about your different buckets of work and how they can most efficiently and effectively be dealt with as a function:

• Low volume / high risk - such as complex M&A. As this is ad hoc and specialised work, this can be most effectively dealt with by a law firm. But you should implement a panel or tender process to ensure you’re benefiting from the best possible costs.
• Low volume / low risk - such as contract queries, like when is my contract coming up for renewal? This sort of work can be easily insourced to the business with appropriate training and technology, such as a contact repository they can refer to.
• High volume / high risk - such as strategic contracts. This should be dealt with by your Legal team who have the institutional knowledge and contacts within the business to deal with these most efficiently. But you can improve the way they do this with better templates, playbooks and technology.
• High volume / high risk - such as BAU commercial contracts. This type of work is ripe for outsourcing to a shared services centre or third party. There are multiple reasons for that:
  - Outsourcing partners are highly trained and experts in commercial contracting, making them highly efficient.
  - They’re bound by strict SLAs in a way your internal team is not, turning contracts around much more quickly.
  - They’re often tech enabled, again enhancing efficiency, and actively pursue costs and process efficiencies.
  - And finally, your partner can liaise directly with your business to reserve strategic legal and procurement resources for work that is more strategically important to the business.

2. Operationalise

Once you’ve established where you’re going, who is going to be doing what and what tools, artefacts and processes need to be put in place to enable them to do that, it’s time to operationalise.

This phase is about laying the groundwork to enable you to deliver on your strategy and  laying the foundational elements of your contract management function that will enable you to implement and execute on your new strategy.

• Finding the Right Partner: If you decide to outsource, as a minimum, that pattern should be providing you with an efficient, cost-effective service. But even better is one who can support you in your set-up phase, developing your playbooks and templates and helping you optimise your tech and operations. Look for a partner too who can provide you with valuable data about your function and is culturally aligned with your organisation (as they’ll interact with you a lot!).
• Optimising Templates: Simplify, standardise, and streamline templates to fundamentally reduce the time it takes to contract and streamline negotiations end-to end.
• Creating Playbooks: Standardise your negotiations even further by implementing playbooks for your shiny new templates, enabling you to delegate negotiations to third parties or junior team members and ensuring a consistent risk profile across your contract negotiations.
• Adopting Standards: Even better, embrace contract standards such as oneNDA to eliminate negotiations altogether and expedite the contract creation process through tools like AutoNDA.
• Choosing the Right Tech: Define your problems, objectives, and requirements before adopting technology. Consider point solutions where appropriate, and you can even use our legal tech directory to help you find the right tool for your organisation.

3. Document

The documentation phase is crucial for maintaining clarity and consistency in processes. Formalising the creation, review, negotiation, signature, storage, and ongoing management processes is paramount.

• Formalise Processes: Clearly define and formalise each step of the contract management process to ensure consistency and efficiency.
• Document: Create a comprehensive documentation system as a reference point for all involved parties.
• Distribute: Share documentation with relevant teams to ensure everyone is completely clear as to what they’re responsible and accountable for. This is important in any organisation, but very important in an enterprise environment where you have many more people involved, and clarity is essential for efficiency.

4. Data

Once the strategy and processes are in place, it's time to gather and analyse data to assess progress toward objectives, and demonstrate the value your CM function is bringing to the organisation.

• Look at your objectives. Use data to support and evidence strategic objectives, such as reducing negotiation timelines by half.
• Examples of Data: Relevant data from contract automation systems or repositories, including metrics such as speed to contract, the number of contracts created, and the frequency of legal queries, can be extracted.

Conclusion

By wholeheartedly embracing these steps, you can smoothly shift from a reactive position - where you find yourself under-resourced and carrying out tasks manually - to a fully optimised state - where your contracts, templates and playbooks are being produced efficiently, and your non-core work is outsourced to the right partners.

This journey not only boosts operational prowess but also paves the way for seamless compliance, risk mitigation, and sets the stage for vibrant business growth.