Contract Lifecycle Management – A Strategic Business Asset

Recently, I’ve been getting under the skin of a lot of S2P technologies, and it has made me think more about their application, and how such platforms and their modules are actually helping people working in organisations, public and private, in totally different spheres. I always try to look at the real-life application of systems, bridging the gap between ‘having to’ use technology for the day-to-day job and engaging with a platform, exploring how much information it can give you, how it can help drive change, bring security, efficiency and change the everyday role of a person into being more proactive, with opinions on the flow and output of information.

On this topic I was talking to the lovely folk at Icertis very recently. Icertis is a leading provider of contract lifecylce management (CLM) tech, for legal and buy- and sell-side contracts. We had a chat about the importance of contracts. Carina Hoogeveen, Senior Director of Marketing for EMEA, is as passionate as I am on such topics.  Put bluntly, Carina states: “Contracts are the backbone to any and all agreements, commercial or otherwise.”  We agreed that there exists a whole host of contract types, from marriage, booking a hotel room, having an employment contract, to mergers and acquisitions, supply agreements with a pallet manufacturer, or sending a PO for goods and services.

Then there are contracts on a different level: trade agreements between countries, carbon emission agreements, peace treaties and dare I say, Brexit, which will come down to agreeing a contract with Europe (once it’s agreed on home turf).

The point is … contracts are really important; they establish the terms of how respective parties who sign the contract will operate with each other, yet sometimes having platforms to author and manage the terms of a contract during it’s entire lifecycle is a ‘nice to have’ solution rather than a necessity.

Says Samir Bodas, CEO and Co-Founder of Icertis:

“We believe that the digitisation of contracts would unleash enormous value at enterprises by allowing cloud computing and, later, artificial intelligence, to turn these static documents into strategic business assets.”

It’s powerful to think of contracts as ‘strategic business assets’ and I think that’s what isn’t widely recognised. Negotiating and authoring contracts can be some of the most painful, expensive, acrimonious, drawn-out months of work. Managing a contract through its life without alerts to key timelines and success measurements is, at best, patchy. Being unaware when contracts are up for renewal, or not having full visibility of supplier T&Cs, can put organisations at serious financial, legal and reputational risk.

We all know that a good contract can go badly wrong if not managed well. But managed well, there are two very important benefits: risk mitigation (performance and commercial) and opportunities (adding more value). To do contract management properly requires the right resource and skill, good systems and processes. Digitising contract management has the power to yield even higher returns: efficiency of storage, SLA retrieval and milestone alerts; better supplier negotiation through current and accurate data; compliance.

Once a contract has been put in place, that’s not the end of the process – it can’t be just locked away and forgotten about. It’s a living document that requires monitoring, for both private and public sector. I wonder how many governments are using CLM platforms to agree trade agreements, treaties, the UK’s exit from Europe? I don’t know actually, but would be interested if anyone does know how governments author and manage contracts. I’d love to be positively surprised that these very important documents aren’t locked in a filing cabinet or sharefile.

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