When it comes to contracts, the corporate legal team is usually in the center of the action. While many other departments depend on contracts to get their business done, they look to the legal department to be sure they are doing everything right.
Modern legal departments have adopted the practice of contract lifecycle management (CLM) to help them dramatically improve their efficiencies and collaborate better across the enterprise. With 55% of global legal departments using a contract management system of some kind, it’s clear that general counsel understand the need for a system to manage the chaos.
What’s less clear is whether they have the right level of engagement from their key stakeholders to enable their system to work most effectively.
The rest of the business may not realize that the old way of managing contracts isn’t working because the legal team does a good job moving mountains on every deal to lessen the pain for stakeholders. Or the business has simply gotten used to long lead times for contracts.
In the meantime, the legal team is caught in the grind of time-consuming, repetitive work and processes. The business overall suffers because of long lag times between contract creation and execution and inconsistencies between contracts. Not to mention the potential risk you take on when you don’t have visibility across your contract portfolio or a way to act on your key contract deadlines and obligations.
Your team is determined to protect the business from risk, and you see that a CLM solution can help you deliver. How do you bring your business partners along with the change? Focusing on the benefits to the business overall will only get you so far. Tailoring your message to each department will be crucial.
Here are some ways you can match the benefits of a CLM system to the stakeholders you’re looking to engage.
Procurement teams are focused on the full process of vendor selection and management for a corporation, and contracts are just one part of their job. Focus on how the Procurement team would benefit from an efficient, streamlined end-to-end contract lifecycle process with a predictable timeline for contract review. Consider, too, how they would benefit from a systematic way to incorporate contract deadlines and obligations into other business systems to be sure they are met.
This team may wonder how your system of choice will integrate or work alongside their own procurement software. Work with potential vendors to map out the way their system interfaces with adjacent tools to reduce friction or re-work.
Sales teams frequently engage in contract work with the Legal team, particularly on large enterprise sales or in deals that involve heavy discounts or bundles. They may have felt the most frustration when it came to long review times, and they will likely welcome a system that streamlines the process.
You may encounter some friction if your solution involves a self-service portal for sales contracts. This comes with significantly faster turnaround times, but also with more standardization and perhaps less flexibility. Work with Sales leadership to determine when and how customization can occur. And build in plenty of training and support so the Sales team is fully able to use the self-service tools.
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Your colleagues in IT will understand that a modern workflow system will help your department operate more smoothly. They’ll have questions, though, when it comes to selecting the vendor and implementing the system within your network. They will be concerned with security, data storage, and potential redundancies.
Work with a vendor that has the features you need to meet your CLM requirements and that will work with you and your IT colleagues to ensure the system works well in your network. Choosing one that is built on a foundation of experience, expertise, and authoritative sources of truth can help reassure the IT team that the implementation will go well.
Like Legal, the Finance team works hard to protect the business from risk and position it for growth. The Finance team will be most curious about the expected return on investment with a new CLM system. They will also want to know how long it will take to recoup the cost.
[For more on explaining the ROI of new Legal tech, check out Three measures to improve ROI for legal spend.]
The Finance team will be glad to know that a CLM can help you manage compliance with the individual terms and with industry regulations. That monitoring can help you avoid large fines. They may ask about the potential headcount implications of adding the software. When you lay out the ROI in your business case, be sure to account for hard costs as well as the increased capacity when you are able to let lawyers focus on high value legal work rather than routine tasks.
An investment in a CLM system will likely require an airtight business case. As you put your case together, be sure you can clearly articulate why your business partners should support this investment. It will make your business case stronger. And in the end, it will help your implementation go more smoothly as well.
Thomson Reuters helps Legal teams reach a new level of efficiency and gain complete contract visibility with end-to-end CLM solutions. Learn more.