Market Guide 2017
for Enterprise Legal Teams
Better contract visibility across contracts and counterparties
Scrolling through emails, documents and file systems for contract terms is more cumbersome than searching for a needle in a haystack.
eContracts provides contract visibility by bringing together all aspects of a contractual relationship such as legal terms, financial and business obligations, potential risks- all in a single contract workspace view. For compliance reasons, the complete audit trail is retained for critical activities such as negotiation history, ownership and users, document copies and sharing, related parent agreements and audit trail of events including renewals, correspondence, amendments approvals, and signature.
Contract repository views, advanced search features, alerts, and reporting provides a comprehensive view of organization contracts.
Improve business & legal collaboration
Contracts are seldom a legal only affair. These agreements of terms and conditions are often between business or project teams of two or more companies, for aspects such as intellectual property sharing, purchase or distribution of goods or services or research collaboration with business objectives and obligations. Therefore it’s successful contract execution is the shared responsibility of legal and business teams.
eContracts is built in such a way that overall contract management and ownership can be extended beyond legal and contract management teams to business teams. Simple easy to use configurable forms and workflow automation allows for the self-service creation of contracts with only customized terms and clause language routed for legal review and negotiation. Responsibilities and obligations of active contracts can be easily shared between contract administration (renewals, amendments) and business teams (payments, delivery of goods).
Eliminate unintentional renewals and expirations
While some contracts require a formal renewal process, ‘evergreen’ contracts are automatically activated. Organizations could potentially face heavy penalties and consequences when renewals of revenue contracts (such as with customers and distributors) are missed or delayed and spend contracts (with suppliers and vendors) get renewed unintentionally. These situations can destabilize an organization’s financial projections, and create havoc in relationships with your counterparties.
eContracts contract renewal features along with calendaring, and multi-stage reminders keep all stakeholders informed about upcoming renewals and expirations. Inbuilt- processes are available for common timeline terms such as evergreen, fixed term and annual renewal contracts. Workflows allow business users to provide feedback on contract performance and renewal decisions.
Streamline productivity - Efficient cycle times
In some cases, contracts are routine, authored from standard templates and carry low risk; others may require long cycles of drafting, annotations, blacklining, negotiations and formal sign-offs from department managers, special committees and executives – taking months before the final execution. While the complexity of these contracts are contextual, paralegals and administrators should have insights into which contracts should be dispensed with quickly and the kind of issues and teams or individuals that take the most time.
Cycle-time metrics are core to eContracts pipeline feature. Contract turnaround time and user activity reports help in planning and estimation, identify process bottlenecks, opportunities for standardization and improve productivity across the board. Bottomline, you get to close faster!
Improve regulatory and process compliance
Contract processes automation cannot be successful without taking into account the needs of adhering to constantly changing regulatory mandates, information disclosure requirements, industry best practices and corporate policy. Highly regulated segments such as life sciences and financial services organizations, government contractors, hospitals, and universities are constantly looking for ingenious ways to avoid non-compliance fines and settlements with contracts.
eContracts governance and regulatory features help organizations in establishing procedures and controls for vendor evaluation, contract documentation, and authorization, audit tracking, terms and clause language usage, renewals and amendments, access to confidential information such as financials and executive views, regulatory obligations – all while being agile and efficient.
A better delegation of responsibilities
One of the most neglected areas in contract management is the identification and expectations of contract owners, contributors, and consumers. Contracts have multiple viewpoints and should it be owned by legal, business owners, subject matter experts, or sponsors? Adding to the dilemma is the fact that most critical contracts have a long life, in some cases running up to 20 years or more – during which most teams and individuals get replaced.
In reality, identification of the roles and responsibility in itself is a huge leap towards contracts process maturity. With eContracts, administrators can disentangle complex contracts into logical information fragments suitable and appropriate for legal attorneys, project owners, finance analysts, business owners and users. For example, action items related to contract renewal can be assigned to a sales manager, while revenue obligation reminders are sent to the company’s finance analyst.
Efficient identification and mitigation of contract risks
Contract risk management along with the formulation of appropriate risk mitigation mechanisms is the major focus of an in-house legal team. Repositories and process automation can fix operational risk issues such as misplaced certificates and unapproved spend. On the other hand, risks inherent to the contractual relationship are addressed with representations, warranties, and risk allocation language such as hold harmless, limitation of liability and waivers in the signed document. Potential commercial losses from claims and incidents are often covered by insurance.
Contracts once signed cannot be stashed away till a risk event occurs. Organizations have to be constantly aware of expiring insurance certificates, evaluate risk in the context of changes to leadership, internal policies, regulatory mandates, mergers and acquisitions of signing entities etc.