This will inform the early decisions of the team about which areas of CLM — visibility, contract authoring or performance management — will be implemented and in what order. Furthermore, it will help the team determine the scope of the rollout, whether it will be based on business unit, function, region or a combination thereof. If buy-in is strong across the company, a broad but phased rollout may be possible. If not, a smaller-scoped initiative that can gain traction and success, and later be broadened, may be the better approach.
Within each of the key CLM implementation areas — visibility, authoring and performance management — there are very specific tactics companies can take to pave the way for success. Included below are a few of these:
- Consider how the repository will be used — this can significantly impact the approach you will take.
- Find legacy contracts and determine which will be loaded (above certain value, currently active, etc.).
- Determine which data and files will be loaded and whether overview data will be parsed out of each contract for reporting purposes (structure these for bulk import).
- Consider visibility and how users/roles/permissions will be assigned during repository loading.
- Consider the users that will need access and what type of access they will need; you may want to consider access required by different groups of users.
- Engage with legal resources at the outset.
- Gather and evaluate current templates or commonly used contracts.
- Agree on common clauses and template types to load into the solution based on the determined scope.
- Consider where contract overview data (such as addresses, payment terms, etc) should be automatically inserted into the clauses when finalizing the clause content.
- Determine which clause content will be mandatory or optional, and where you will provide alternate clauses for authors to use.
- Start small but plan for a larger rollout, including globalization considerations such as languages.
- Determine how much compliance the company wants and needs, on which contract types, and how that should be achieved (automated or with user intervention).
- Agree on how the solution should interact with the company's back-end systems and the most effective distribution model.
- Understand the solution's out-of-the-box integration capabilities and constraints.
- Plan for any custom development projects and involve internal IT experts.
- Understand your reporting requirements for both end users and management.
- Plan for this reporting and alerting to gain the most value.
What Does Success Look Like?
Some of the key performance indicators supported by Aberdeen Research show the overall success of best-in-class companies using CLM solutions:
A few examples may also help you understand what various companies have done to achieve success in the context of their company-specific goals.
- A major North American insurance provider focused on contract creation, having authors capture Sarbanes-Oxley (SOX)-related purchase commitment information for every buying agreement. In capturing and automating the reporting for SOX, the company cut the reporting process time down by 90 percent (from days to minutes).
- One of the largest telecommunications companies captures each employee requisition and turns many of those into contracts, typically statements of work (SOWs) underneath a master agreement, to contain their hard-to-control services spend.
- A major IT systems and services provider loaded over 50,000 contracts into a repository to provide global visibility and create a starting point for further sourcing opportunity identification.
- One of the largest pharmaceutical companies enabled backend integration on most contract types to ensure critical agreements would be executed with compliance to contracted pricing and terms.
While bleeding-edge technologies and approaches exist in many CLM solutions, in the end a successful program is about handling the basics — managing stakeholders, scope and momentum. The key is to know your priorities, implement in manageable pieces, and ensure that your most critical company-specific requirements are met first and foremost. Now take a deep breath, and get started.
About the Author: Emily Rakowski is global director of SRM at SAP. More information at www.sap.com.