In response to a looming recession, some businesses will be looking to technology to help maximize efficiencies, reduce risk and streamline operations. One such technology is contract management, one of the most widely used legal technologies by corporate legal groups. It is also the one that most legal departments want to upgrade or invest in.

But the process of selecting and implementing a contract management system (CMS) can be daunting. It can also be costly, if not done right - a heightened risk in light of tightened budgets in the face of a potential downturn. 

Getting the right fit is crucial to reaping the rewards and avoiding the risks. 

Rewards

Risks
  • Improves efficiencies, reduces risk and shortens response times 
  • Source of business intelligence which showcases the value of legal. Auto-generated statistics, reports and alerts makes things easy 
  • Accessibility to key contract data to empower legal and the business and boosts cross-functional collaboration 
  • A CMS that requires too much of legal's time to maintain, leading to decreased use/abandonment 
  • An overbuilt, complicated CMS with features the team does not need or understand which slows everything down
  • Wasted time and money for a CMS that is not adaptable to the business's growing needs

Here are our top tips to help you make the right choice for your business and make the process as painless as possible. 

  1. Know Your Requirements 

To select the CMS that best fits your organization's needs, you first need to know your requirements. Establish a clear understanding of your current workflows, processes, stakeholders and end-users. This will help you answer fundamental questions (what does success look like? what are must-have and nice-to-have features?) and uncover opportunities for process improvement. Now you can identify the features that will truly help you work more efficiently. For example, when you identify the repetitive and manual tasks burdening your team (e.g., contract routing, excessive back-and-forth communications, creating and disseminating reports, drafting and negotiating standard contracts), it will be clear whether certain features, such as automated workflows and document automation, are must-haves or nice-to-haves. 

  1. Customization and Future-Minded Functionality

Even when you know your requirements, it can still be challenging to predict how your organization's needs may change in the future. For long-term value, consider a modularized CMS that is customizable and gives you the flexibility to choose the features you need today, but keeps the door open to add features for future needs. 

  1. Start Small, Keep it Simple, Build Momentum

Your goal is to get long-term value from your CMS, so it may seem counterintuitive to start with just a subset of your contracts or users, or with only using key functionality. However, this approach can allow for "quick wins", build credibility with users by giving them simple features that they need and ensure they are not overwhelmed at the front end. Once users are comfortable, you can add new features (see Customization & Future-Minded Functionality, above), as well as additional contracts and users. 

  1. Look at Features and Teams

While selecting features that match your requirements is critical, the vendor's implementation team is too. How will they help? Do they have experience with the day-to-day challenges with contract management? Do they understand the problem they are trying to solve? Will they train your users? Vendors often have great products, but disconnects can arise between developer and user. You might even want an external consultant who is experienced in CMS implementation.

  1. Shorter Commitments with Exits

When contracting with a CMS vendor, look for how you exit. This might include early termination rights if you are not satisfied or simply shorter initial terms. And ask the vendor how they will assist you if you decide to migrate to a different CMS (e.g., helping with data transfers).

Also, do not get trapped in a sunk cost fallacy. If the wrong CMS was adopted, learn from it and find one that better fits your needs. Restarting is not as hard as starting from scratch because now you have a clear picture of what you need and what to avoid.

  1. Leverage Your Champions

The approach of using champions is well-used in various technology implementations. Identify a few of your target users who are going to adopt, love and promote the CMS. Help them stay invested by giving them a role in selection and implementation.

  1. Lean on Your Legal Service Provider

Leverage your law firm's research and experience with products in the market. Often organizations are not sure of their needs until they see the solutions. Even then, it can be unclear whether a specific feature is helpful until someone with experience shows you.

Moving to a CMS can be an involved process. Corporate teams are often too busy to find the time they need to become less busy. Ask your law firm how they can help you implement a solution. 

Finally, find out if you can get access to cloud-based, contract management technology as part of their legal services. This can shorten the time and burden around deployment. 

In conclusion

Getting the right fit is crucial to avoid non-use, unnecessary complications and wasted time and expense. It's also the key to realizing the many benefits arising from automating some (or all) of the stages of the contract lifecycle, from intake to post-execution management. 

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.