As an in-house legal professional, ultimately your role is to support the business and all its employees by providing legal advice on contracts. But, when you or your department struggle to meet the demands of internal teams, legal can quickly become a bottleneck to the rest of the business.
To ensure you can provide the business timely responses, it’s crucial to find solutions that optimize your ability to provide legal services. The challenge is that many legal tech solutions only focus on how to improve the way you do legal work, without considering how they can bring benefit to the business as a whole.
It’s for this reason that many legal-led tech initiatives fail. The larger business likely won’t care that your life is full of annoying and time-consuming processes if they can’t see how it impacts the business’s overall revenue, profitability, and growth.
Since this is a struggle for many in-house legal counsel, I want to take this opportunity to walk through ways you can identify your own reasons for wanting a legal tech solution, and maybe even more importantly, how to align your “why” with reasons that are meaningful to the entire business.
Step 1: Identify your “why”
The first step toward implementing a legal tech solution is to identify your “why” or your reason for wanting it. Contract management decisions often feel complex, but with the right “why,” and the right focus, they can actually be very simple.
It should go without saying, but I’ll say it anyway: You shouldn’t implement new technology just for the sake of automation. Wanting to “automate everything” isn’t a good “why” that will get you to your end goal.
Similarly, you shouldn’t aim to solve issues just because they are annoying to you. You should solve them because they’re truly pain points for your business.
In a legal context, this could mean adding automation so you can remove yourself and excessive time from the process. But it’s important to be smart about where and how you do this.
If you’re just reinterpreting an existing process in a fully electronic way, without taking anything off your plate, you’re not actually curing any pain. You’re just trading one type of pain for another.
You may find that you have more than one painful issue within your organization as it pertains to your contracts and your contract process. You don't absolutely have to narrow things down to one issue, but it’s important to focus and clearly understand the problem you're solving at any given point with any given solution.
Often, that does mean keeping your eye on the prize – one issue and one prize at a time.
Step 2: Understand the different types of contract management pain
Typically, organizations experience two types of pain when it comes to contract management — chronic pain and acute pain.
Chronic pain: This contract management pain is experienced when there’s no central repository, which means locating contracts for the business takes an excessive amount of time.
Acute pain: This contract management pain relates to the escalations that take place due to a lack of visibility on the status of a contract.
Luckily, the treatment for chronic pain in your contract management process is relatively simple. Create a digital contract repository!
Addressing acute pain is a little more involved as it often flows outside the legal department, through your internal clients, and other areas of the business. By its very nature, the acute pain is felt outside of the legal department, which may help you in your case for easing it.
For example, while an internal client or business partner may be aware that you support numerous different contract requests, they don’t feel the same pain you do from that volume. What they do feel is the worry from their own request, which may be delayed because it takes you so long to fulfill. They may escalate their request to their manager, which is uncomfortable for everyone involved. Eliminating the cause of this pain, that spans across business units, can be a valuable piece of your “why.”
Step 3: Identify pain points within the larger business
“You know why you’re doing this for you, but why are you doing this for them?”
Contract management solutions aren’t short on legal-centric features and functions, but your “why” should elevate above that. Now that you’ve identified pain points from a legal perspective, you should consider the ways in which a legal tech solution will benefit other aspects of the business:
Automating the contract process
Being able to create contracts more quickly is an obvious value proposition to the business as new contracts result in new revenue and growth. Time saving through automation may be a huge “why” for you, but it could also be a value-add to the larger business.
It probably goes without saying but no company benefits from wasting their talents’ time on manual, repetitive administrative tasks. All the more so when that talent is a highly educated, highly skilled, and highly paid legal resource.
Streamlining contract requests and visibility
Perhaps the biggest benefit a contract management solution can bring to the overall business is the impact it will have on the sales team. Many legal departments have a bad reputation with their sales teams because they’re a bottleneck where contracts are concerned. The head of sales cares about revenue, above all else. So, if your legal function isn’t supporting the fastest and highest revenue possible, there’s room for improvement.
A contract management solution means it’s no longer painful for sales to request new contracts or to access existing ones. Streamlining contract requests and approvals, along with democratizing contract access and information supports the sales department on key activities like targeted campaigns, account planning, and renewals.
Bottom line: investing in contract management for legal will payoff for sales.
Step 4: Connect your why to the paint points of the larger business
“Your contract management efforts will only be a priority for others if you show them why.”
Your reasons for wanting a contract management solution won’t get you very far if they’re only focused on helping legal. And your contract management efforts will only be a priority for others if you show them why. To do this, you need to illustrate the organization-wide ripple effect that innovative contract management can deliver.
Your “why” must articulate how solutions, like a contract management system, benefit the people you work with on a regular basis. A system that makes information (such as contracts) more readily accessible to everyone can ease frustration by streamlining processes that ultimately affect every legal touchpoint throughout the company.
When you do your job better, you empower everyone else to do better as well. For example, you’ll receive better outcomes when you aren’t spending time chasing down contracts across their lifecycle. And when you receive better outcomes, customers ultimately get a better experience, which improves retention and growth.
As the champion for contract management software, it's your responsibility to connect your own “why” to the value of the overall business. Show each department how the solution can cure pain points in a real, meaningful way that benefits both you and the organization.
“Pramata has benefited more people and internal teams than we ever anticipated. Pramata has added tremendous value for us.””
Step 5: Highlight the values of a contract management solution
Articulating the benefits of new legal tech to sales is easy. What sales department wouldn’t love to have instant visibility to necessary contract information? Or to be able to automate their contract request with forms pre-populated with data in the CRM? But the benefits of a solution may be less obvious to the larger business.
You should aim to highlight the value that enhanced visibility into contract creation provides to the business. With a contract workflow solution like Pramata’s ContractQ a legal department can now ensure that it’s prioritizing work, so that the deals that need attention more quickly are getting it.
We often recommend companies start with a digital contract repository as the first step, one that will solve the chronic pain of the legal department. But taking it a step further, a request and workflow solution like ContractQ adds an additional data layer onto your contracts that provide a reference-able resource and historical record to refer back to later.
A simple contract repository can show you everything that was agreed to, but it can't tell you why the business agreed to those terms. Documenting approvals in the creation process creates an important historical record that's available to consult when you want to understand things like who in the business approved something or why they approved it.
Think of the Qualitative ROI
If you’re having trouble communicating the benefits of a contract management solution, think about the ROI. You probably assume you need to provide a quantitative ROI, but these cases don’t always have to have a dollar figure to be effective. Things like missed opportunities, wasted resources, and bad customer experiences should matter to the business!
The business-wide effect of weak contract management is a clear talking point. Remembering the painful, cringe-worthy missteps your organization has made due to lackluster contract control can be plenty to move the needle.
Look back on the times when failure to manage contracts negatively impacted business success and start building a case history to present your solution, like:
Accidentally letting a customer out of a three-year term because you didn’t realize they had signed a long-term agreement
Missing an uplift at the time of a customer renewal
The countless times you unintentionally paid for a service or product you didn’t actually need.
When you outline all the daily struggles and unexpected fires that could have been prevented with your proposed solution, the problem becomes painfully apparent. By identifying the qualitative ROI, you can demonstrate the ripple effect that excellent contract management has in accelerating and improving every aspect of work the business undertakes to support and operate its contractual commitments.
Good contract management benefits the whole business
When in-house legal teams do their job well—particularly in contract management—the impact stretches beyond legal. Benefits touch every part of business operations. When you understand how contract management impacts other departments in your company, you can better explain how investing in contract management software benefits them, as well as you.
By focusing on improving the work you do with your internal clients, how you do it, and your ability to provider better and faster service business-wide, rather than just avoiding headaches for legal, you’ll be able to find they “whys” that work for everyone and ultimately get you the solution you’re looking for.
If you’re ready to get started improving contract management for your entire organization, check out Pramata today!