Why invest in a contract management solution? Listen to our webinar and the question will be – why wouldn’t you?

We have just hosted an interactive webinar with eProcurement specialists Medius (Wax Digital) drawing on their expertise in the contract management space: “Contract Management – Love it Don’t Leave it,” and it is recorded here for anyone who missed it.

Eventually in an organisation’s growth journey it becomes clear that there is a need for more structured processes, systems and tools to help improve procurement performance and meet the needs of the growing firm. That realisation is often driven by some kind of incident, it may be supplier failure, it may be fraud, it may be lack of up-to-date knowledge – there are many pitfalls for companies without automated processes. For any procurement function, or indeed any business, progressing on its development path, the management, security and accessibility of its contracts is essential. Contracts, we must remember, touch every part of the business, whether they are with the suppliers, employees, sales or other stakeholders. So that is why the topic was chosen as a discussion point for Daniel Ball, VP S2P Innovation at Medius (Wax Digital) and Jenny Draper, our GM for Europe.

They look at the issues, opportunities, priorities and risks that drive an organisation to invest in contract management best practice. They uncover the pain points, the implications of not addressing them, and highlight some real-life case studies that we can all empathise with. And in an effort to understand where your organisation sits on the contract management maturity curve, and where you need to go next, Wax Digital has developed a self-scoring system that participants can take advantage of. It is explained in the webinar, but basically by answering a series of seven statements, and by appointing a score of 1 to 5 for each, that will reflect where you sit in terms of contact management maturity. The webinar explains what each level means in practice and is very a useful mechanism for anyone wishing to build a contract management business case.

Our hosts share their thoughts on what is at stake when you don’t pay enough attention to contract management, and the whole raft of serious problems that can arise. One of the problems, Daniel points out, is that finding the root cause of these problems can be like finding a needle in a haystack.

As contracts become more digitised, explains Jenny, they are becoming a very important piece of master data for the organisation, whether that be for planning, R&D, treasury, audit or of course procurement. And chief executives are understanding their strategic importance more and more.

On the tactical side, not only are there some serious risks to business from mismanaged contracts, but it involves a lot of time and resource to deal with them without a contract management system, especially in today’s era of remote and dispersed workforce. We have to make sure, says Daniel, that there is appropriate access levels for those who need to consult, retrieve, change and save those contracts, and of course we must be in compliance with GDPR and other regulations.

Why then, Wax Digital wonders, does its own market outreach reveal that 60% of firms have limited digital processes around authoring and amending contracts with suppliers, that 25% of contracts still roll over without any intervention, sometimes for unwanted contracts, and that  45% of organisations with over $700m in turnover still don’t have a central digital system?

What’s complexing in the market today, Daniel explains, is that it’s the mid-market firms, who think they are at less of a risk than the large enterprises, who are the ones actually at greater risk. They are less likely to have a legal team in-house, or the might to enforce terms on suppliers. Yet fewer have a repository system.

So we hear from our hosts about some situations they have been involved in that highlight the need for automated contract management. One involves the NHS, spending £20 million over four years with a non-contracted supplier for medical equipment. There was a more current contract in place with more favourable rates, but it had been wrongly filed on a shared drive and the people who should have had access to it, didn’t. It was only after a spend analysis project four years later that it came to light that they could have saved $5 million of public money, and indeed received better value for money.

Another example involves the oil and gas industry. A firm contracted with an engineering firm to design and build a platform in the Middle East. But because the O&G firm hadn’t paid enough attention to the contract terms, and the updates and versions of the plans and drawings, when it came to hand-over phase, it was discovered that all the drawings and IP belonged to the engineering firm. The O&G firm then had to licence them back at a great and unexpected expense.

These are just two examples that show the importance of good contract management practice. So, they ask, what should technology be doing for us? That is explained through a case study with customer ITV.

Contract management is not a costly investment, says Daniel, compared to the ROI. And this webinar will give you the basis for a business case to make that investment. And as Jenny pointed out: “the large number of attendees we had on this webinar emphasises that de-risking from a Contract Management perspective is highly important to buyers. We shared some great war stories, and gave tips and actions to get your contract management under way – it’s well worth an hour of your time without doubt.”

There will be a follow-up webinar to answer all your questions, so look out for details of that soon. In the meantime listen to the discussion here.

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