Most companies know they should implement a Contract Lifecycle Management (CLM) system to keep track of the lifecycles of their business contracts and agreements. And those that have started the process understand how overwhelming it can quickly become.
In fact, some companies that start down the CLM path quickly give up, frustrated by the process or the fear they won’t realize an appropriate return on investment.
I’ve heard from corporate lawyers of two main pain points when it comes to CLM:
- They try to sign up for a solution where the price seems reasonable. However when evaluating different vendors, it quickly becomes an enormous time sink to book demos, get quotes, and compare features and costs.
- Once they start down the CLM journey and look at the implementation process, it quickly becomes overwhelming. They learn it may take one or two fulltime employees to manage the process that will take six months to prepare to launch. This may not have been clear in the purchasing process! Then, they fear the whole thing won’t be worth the effort, face a low adoption rate by stakeholders, and will ultimately fail. Or, they fear the system must be constantly modified and maintained, defeating the purpose of implementing CLM in the first place.
What’s another solution? How about a CLM system with lower costs, quicker and easier implementation, minimal training, and the ability to launch on a small scale rather than going all in from the very beginning?
The key is finding a way to make a smaller bet on CLM.
That is possible with the right system. Most companies have some form of a CLM system - from a simple document repository to very fancy contract management tools. Most enterprises will have a big, robust complicated set of processes either encoded into a CLM system or haphazardly created in documents that outline how to manage their contract lifecycles. The complexity of onboarding a new CLM system is proportionally related to how complex a company’s legal processes are, generally tracking to the size of the business.
While some highly organized, ground-up tech companies will have implemented a slick internal CLM system, the same can’t be said for all businesses.
Consider the overworked in-house counsel who gets way too many e-mails and phone calls and tries to manage them with a home-grown Excel tracking system or – worse yet – a slew of sticky notes tacked to a white board. This is how they manage the contracts coming in and going out. This system is impossible to scale.
Most companies would benefit from a CLM system that – at the very least – allows them to manage document generation and execution of the contracts.
Rather than going through an arduous months-long process to launch a robust CLM system that takes significant training and full-time employees to manage, consider a CLM service provider that can quickly take a business’s home-grown CLM process, integrate with it, and take over one part of the lifecycle. Imagine a low-cost, low-friction solution that involves sending your business’s sales contracts to the CLM provider and having a custom system set up in 48 hours, ready for your sales team to log in, modify the contract, and send it to the legal team for quick turn-around. This is possible with non-disclosure agreements, licensing agreements, consulting agreements, equipment lease agreements and purchase agreements as well.
By picking a vendor that allows you to make a small bet first, at a low price, and with a short implementation time, a company can understand and evaluate a solution in their unique situation before committing to a more robust implementation. In the best-case scenario, that bet is a success, and you’ve laid a foundation for a future effective and worthwhile CLM. In the worst case, you’ve learned important information that you can use to make a better decision on how to manage the contract lifecycle, with only a minimal investment of effort in the process.
Ideally, companies should look for a low-cost solution that leverages what they already have, a system that allows them to try out the CLM offerings without committing to significant costs and a huge implementation effort.
When it comes to implementing a CLM system, don’t be afraid to start small. Be wary of partners that want you to sign the world away. Be comfortable with people who let you try a small bite first.