A disaster, or a well-managed asset? See how you score on this brief test:
- When the pandemic hit, was it easy to find all your contracts?
- Could you be confident it was the current version?
- Could you quickly search across each contract for key terms – for example, rights of termination or delay, force majeure, payment obligations?
- Were you able to rapidly produce consolidated management reports on risks?
- Could you easily assess the impact of supplier default on the performance of customer contracts?
- Did you have rapid insight to opportunities for renegotiation or term offsets?
Most organizations struggled with these questions – and that is the gist of an article published by law.com, in which the authors call the lack of robust contract systems ‘an unmitigated disaster’. In a poll last month, 81% of IACCM member companies acknowledged that the pandemic has accelerated the need to simplify and automate their contracting process.
Why is this still an issue?
The article in law.com calls on General Counsels to step up and fix the problem. But they can’t and they won’t. This is not a legal issue; it’s a business issue, requiring consensus across multiple stakeholders.
The pandemic has revealed the consequences of failing to treat contracts as core assets and sources of business information. The benefits that flow from developing an integrated contracting process are abundantly clear. Now is the time to push for change.