How can you simplify your contract workflow?

Though there are multiple solutions availble in terms of platforms to manage the workflow. However, the key is to keep it simple. As long as you have the clarity on the KPIs, it is easy to have a simplified approach instead of getting carried away by other factors

Agree but with strict control on who can update/edit… if you have 100 cooks in the kitchen this will not work. Making changes online should not prevent you from having regular review and meeting with the customers to make sure you are aligned and going in the same direction.

Contract documents are very important for projects because they contain a lot of sensitive information based on the individual project, and the cloud is an online platform that is not completely secure, with the possibility of cyber attacks by some who can access the document and use it against the project or company.

CBPs enable high levels of contract compliance in several ways, incl.: 1. CBPs as a centralised repository where Users can securely store, organise, & access contract documents, and version management. 2. CBPs can be automated with alerts for critical events like contract renewal dates, milestone deadlines, etc, to assist contract managers & stakeholders to be proactive on contractual obligations. 3. CBPs offer collaborative workspaces that enable multiple stakeholders to access and collaborate on contract-related tasks. 4. CBPs can automate tracking of KPIs, contract metrics & analysis for contract managers. 5. CBP reporting analytics enable managers to identify trends, compliance issues, and proactive measures.

As with any technology, before investing in a SaaS application or service, consider the people that need to be involved and the processes that need to be put into place to maximize the application or service. Also consider how you will live in two systems (perhaps new contracts/amendments on the new application and existing or older contracts on paper) for some period of time (which depending on the number of existing contracts can be a long period of time). To justify the move to a cloud-based system consider how many renewals were missed and what they cost the company or how much time is spent looking for existing contracts if they are not already centralized.

Nowadays contracts are very commonly raised and many people without a legal background are involved in this process, so it is mandatory now to design and draft contracts with non-lawyers in mind via removing jargon and adding example calculation for all types of margin in contracts.

We've worked with many clients to prepare and implement template contracts, standard terms and conditions of business. It greatly helps with tender processes when service providers are asked to provide a 'mark-up' of the template and with the identification of common 'sticking points' with template contract language. The starting point is to engage with the business to identify what they would find most valuable, typically repeat business or where volumes are spread over many service providers. Try and keep things as simple and streamlined as possible to minimise the number of templates and optional wording within them. Clients find they can then devote more time to the more complex, bespoke contracts saving time and money on legal.

My perspective on this is to have “pick clauses” for standard items such as Indemnities, Warranties, Insurances, clauses outside the core aspects of a “deal”…these can often take a disproportionate time to finalise. These can be developed to suit the risk profile of the counter party, contract value, history in dealing with the supplier, nature of spend (commodity, service, IP etc), payment terms (think one-man business v MNC). Legal sign off would still be required to deviate from standard, at least it demonstrates flexibility and ease of doing business.

Whilst I agree with the standardization, has this not already been done by the likes of FIDIC, NEC et al? Why do we believe that the industry experts, that drafted the model forms, are not acting in the best interests of the industry and fair practices? I completely agree with templates for administration of the contracts that are applicable to the model form but having clauses on “the shelf” can be dangerous and lead to conflict between model and bespoke clauses.

This is important whether you use a tool or go old school. There are many form agreements that can be leveraged to speed the contracting process including NDAs, standard services agreements and the like. With respect to technology related contracts the technology provider will often insistent their form agreement be used. In these cases, have standardized clauses can help in the markup. I need to know that with each standard form, there still needs to be a confirmation that the scope and intent of the new engagement (the reason for the new contract) is appropriately addressed in the form agreement. I have seen many cases where this is not the case in technology related agreements.

For complex agreement I found it useful not to say absolutely necessary to have a bid manager or someone in charge of ensuring that people deliver and have clear tasks. Automation works great for small simple agreements.

A number of software packages exist where users can develop a template contract with blanks and then use a questionnaire to automatically populate those to create a draft contract. This probably works best for routine contracts with little or no deviation from the template wording. 'Sense checking' software is also widely in use to check the consistent use of capitalised and defined terms, consistency of language, punctuation and importantly cross-referencing between clauses. Sometimes this can be over-zealous although it's a helpful tool to use.

Because terms and conditions and charges fluctuate according to project and individual service requirements, the contract department is not a place where you can apply 100% automation.

In complex contracting efforts, there needs to be someone overseeing the effort - setting a schedule for sharing the scope of the effort and ensuring everyone that needs to be involved is involved (risk management, data privacy, security, IT, functional teams, HR (if oursourcing), etc). The schedule needs to call out who is reviewing what parts of the agreement and when feedback is needed. It needs to include engaging with the vendor and ensuring all the right people are engaged on both sides to manage the negotiations and signature processes as effectively and efficiently as possible. In my experience, automation alone will not simplify the process and if fact may cause it to run longer and be more expensive.

I completely agree and wherever possible now use these for client engagement letters as well. Having started using digital signatures during COVID lockdowns, I haven't looked back. It's important for parties to agree the use of digital signatures in advance and establish who will be the signatory and their email address. The process of 'signing' is so simple with just a few clicks. A word of warning though, ensure you are familiar with the settings of the software you are using to avoid partially signed documents 'expiring' and also check on retention policies and ensure you saved fully signed documents in accordance with your contract management policy.

I agree that automation is helpful but the knowledge , experience, team work with team mates and also best practices will enable a successful Terms and conditions.

I agree that Electronic signature is very convenient. I have worked on some agreements where the parties are not US based and where local teams have required "real" signature.

Essential and important to diarise forthcoming key dates - particularly for exercising options to extend, expiry, price review / escalation opportunities and anything else to ensure contracts are 'live' and enforced and not put in a drawer to gather dust. It also becomes important whenever parties want to vary an existing contract to easily locate both a signed copy and ideally an execution version in Word format of both the original and any subsequent variations. This makes the task of preparing a further variation / addendum much quicker and easier. When a long term contract has many amendments made over time, it is often easier to prepare a new amended and restated document which consolidates everything in one place.

It’s essential that you also appoint which department is responsible for storing the contract. One might think that the legal department should be responsible, but that isn’t always logical as in most companies the business can sign contacts independently of legal that are below a certain monetary threshold. In that case not all contracts actually pass legal. So it makes the most sense in a lot of companies that the business is actually responsible for storing the contracts appropriately.

There needs to be alignment as to who "owns" the contracts. I have worked for companies where each functional area was responsible for their contracts which meant it was hard to find originals or copies of contracts and amendments and the like. I centralized all technology related contracts to help address this problem.

One should also keep in mind to appoint a contract manager (or contract managing department) to keep track of the status of a contract once it is signed. In that case someone within your organization is responsible to keep track of e.g. renewal dates, have KPIs set on budget and speed etc. And act as the spider in the web when negotiating renewals.

Payment events is somewhere that needs a lot of work especially with regard to lump sums and DBOM contracts. Some contractors will try and attract larger payments for doing simpler works and spotting this is not always easy to do. Naturally there is also the “front loading” of the payment events and how to manage and spot this as well. The whole of the construction team need to be brought in to this and it cannot be left purely to the contracts manager to spot all of these nuances. FIDIC have a good set of user manuals for their contracts and if bespoke clauses are used then this becomes redundant and no one can then understand how the clause is to be administered leading to ambiguity and dispute.

From my personal experience contract workflows discussions often focus on processes from drafting to signature, overlooking stages like negotiation, approval, monitoring, and renewal. However, these latter phases offer substantial impact potential. Digital tools/platforms are invaluable here, enhancing collaboration, automating tasks, and providing real-time tracking. Thus, comprehensive digital solutions optimize the entire contract lifecycle, ensuring lasting efficiency and effectiveness.

In addition, it is beneficial to involve team members from different departments during the contract preparation process. This way a company can benefit from different views by different stakeholders involved in the project. This is also a great way to identify and share the responsibility between the team members before the contract signature. The digital tools and AI based platforms are excellent tools to support the synergy and proper allocation of responsibility within a team.