Legal teams, contract managers, and anyone else involved with the management and oversight of corporate agreements should know how to measure success and be able to make improvements when needed. One important part of this challenge is having a clear understanding of what is expected of you and what various stakeholders care about in the contract management process.
Of course every business is different and not every CFO or General Counsel is concerned with the same things, but there are some common trends and assumptions that can help shape your priorities when managing your contract portfolio.
General Counsel will almost always have a strong interest in the way contracts are managed, and want those involved with the day-to-day management of agreements to keep a close eye on things like contract risk, visibility, and more. This article explores four things General Counsel expect from a successful contract management process.
Mitigate contract risk by knowing all contract details
Managing and mitigating organizational risk is one of the primary concerns for a General Counsel, so it isn’t surprising that one of their biggest goals for the contract management process is to keep contract risk to a minimum. For those who manage corporate agreements, this is accomplished by having a solid understanding of the important details of every contract in your portfolio so you aren’t caught off guard by blindspots.
There are many ways that not having a firm grasp on your contract details can negatively impact your contracts and hurt your business. Some examples of things to look out for include:
Contract terms or clauses that appear to be boilerplate but actually include minor changes that can completely alter the meaning
Dates and deadlines that are buried within contracts and overlooked
Contract language that is vague and can be left open to interpretation
Spend the time needed to be sure you understand what’s in the contracts you manage to avoid costly and avoidable risks turning into serious problems.
Stay ahead of end dates to give them a chance to renegotiate
As mentioned above, tracking contract end dates is an essential part of mitigating contact risk. If your business is locked into any unfavorable contracts that are either too risky or aren’t proving to be beneficial to the company, your GC is going to want a chance to renegotiate at the first possible opportunity. That can only happen if you know when those opportunities are and plan accordingly.
And chances are that any kind of negotiations are going to require ample time to plan and research in advance to present thoughtful arguments backed up by the contract data. Make sure you’re aware of looming contract end dates well in advance so you and your team can plan for a successful negotiation during the acceptable time frame.
Quickly find key contract data and non-standard terms
General Counsel want to know what’s in your contracts, especially when it comes to things like non-standard terms that require extra attention. The need to locate this and other key information in your portfolio often arises suddenly, which means contract managers have to be able to find any specific details or key words at a moment’s notice to avoid getting caught off guard and unprepared.
In addition to the previously mentioned point on the importance of knowing what’s in your contracts, it’s just as important that you have a way to find that information quickly when you don’t have all the details readily available. Responding to your GC’s requests for contract details quickly will make their job easier and demonstrate that you have a handle on your agreements.
Execute documents easily
Like all executives, members of the legal department, and just about any other business professional, General Counsel are extremely busy and don’t want to waste time and energy on tasks that should be accomplished quickly and easily. And after likely going back and forth through multiple rounds of contract review and negotiation, they want to finish the process as quickly as possible with a smooth signing process.
Much of the contracting process is complicated and labor-intensive, so any opportunities to streamline tasks should be seriously considered, which is why electronic signature has become such a popular option.
If you need a better way to store, organize, and track your contracts and agreement details, download The 2020 Buyer’s Guide to Contract Management Software for tips on finding the right solution.