“Improve Your Contract Lifecycle Management Competence – It’s Not Rocket Science” by Nigel Montgomery
by Debbie Wilson | December 14, 2018 | Comments Off on “Improve Your Contract Lifecycle Management Competence – It’s Not Rocket Science” by Nigel Montgomery
July (20th) 2019 will be the 50th anniversary of the first moon landing. I’m still young enough to remember being allowed to stay up to see Neil Armstrong’s first steps. In the last month, in an event that some might say is even more remarkable given the technology involved, NASA’s Voyager 2 probe joined its twin, Voyager 1, in interstellar space; the pair being the only two human-made objects to do so.
The probe was launched just eight years after the momentous Apollo 11 landing. Both of these events were no small step, but could have been one big headache for the lawyers of the day. Imagine the complexity of the contracts drawn up among the various parties concerned. This same level of complexity lies within many industries, such as oil & gas where organisations might have as few as six overall contracts to administer. Yet each might be worth millions of dollars and constructed of hundreds, if not thousands of documents, drawings and contractual agreements between the primary suppliers and a large number of sub-contract partners.
Projects such as those undertaken by NASA require extreme accuracy in everything undertaken, including contract lifecycle management. There is no room for error and therefore no room for ambiguity or misunderstanding.
But think about it, everyone whether company or individual is subject to contractual obligations set-out within contracts between different parties. Your mortgage, rental agreement, employment contract, marriage license etc. each includes terms, some of which can be very complex. Some companies can maintain thousands of live contracts, many of which are unique and many of which could/should be templated to ensure consistency.
A Contract Lifecycle Management (CLM) solution is a critical commercial and governance tool to protect the organisation. It’s a fast growing market and customer interest is stronger than ever. CLM is evolving from an operational recordkeeping system, primarily used for legal audit purposes, to an enterprise-level core system addressing business risk, costs and the pursuit of revenue maximization.
The benefits of mature enterprise CLM processes would seem obvious. They include increased governance and control over what is signed, when and by whom, plus the protection of knowing that the correct contract terms are live at any given time. It also provides deeper insights across all contractual agreements by analysing content and conditions. Another key benefit is the ability to recognize changing supply network contract trends, enabling the organization to maximize benefits from buy- and sell-side negotiations.
The time to act on your contract management maturity is now, whatever our industry and size, and not when you miss an important obligation. For more information on the market and to see how to select the right solutions to support your hopefully increasing maturity, see the following reports:
Written by Guest Analyst : Nigel Montgomery
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