publication of the International Legal Technology Association
Issue link: https://epubs.iltanet.org/i/395170
and whether the company is achieving anticipated efficiencies. It is also important that the system only be used by those for whom it was intended, and that there are no exceptions. Also essential is the continual maintenance and updating of the contract management system. If the company makes policy changes or updates to its templates or playbooks, these changes must be implemented in the contract management system, workflows must be adjusted appropriately, and notice to employees and appropriate training should be provided. Finally, the company should periodically review its workflows and processes to see if it can further improve efficiency or if it needs to address specific requests from system users. UTILIZE A CONTRACT MANAGEMENT SYSTEM One of the greatest risks faced by companies is that they do not have an adequate inventory of their existing contracts. At a macro level, this affects the company because it does not have a comprehensive understanding of its contractual rights and obligations. On a micro level, the company does not have a thorough understanding of the risks attendant to contractual provisions to which it has agreed. An important step to alleviating this issue is for the company to implement a contract management system. Contract management systems are available in many forms and degrees of complexity. The decision about which type of system a company should select is based on its overall goals. More complex systems will be used when a company desires to use the contract management system to implement workflows based on its contract management processes, to use the system for contract assembly, to maintain contract templates and playbooks, and to integrate with other systems, ILTA WHITE PAPER: OCTOBER 2014 WWW.ILTANET.ORG 39 LESS-RISKY BUSINESS: BEST PRACTICES FOR CONTRACT MANAGEMENT Any nonstandard provisions can be identified and used by the company to later identify risks that it has in its contract portfolio. such as Salesforce and/or ERP systems. Simpler systems could be used for companies that have a lower volume of contracts or for when the company's main goal is to maintain an inventory of contracts and an understanding of basic information such as bibliographic details and renewal and termination data. When a company is concerned it might be losing revenue due to inadequate supervision of its contractual relationships, the contract management system could be used both to support internal initiatives to better monitor and enforce its contractual rights, and to integrate with the company's accounting system to better monitor cash flows. Regardless of what type of contract management system a company selects, the system will only be as successful as the training the company provides to its employees and the seriousness with which the company implements the system and anticipates employee pushback. USE CONTRACT TEMPLATES Many companies regularly negotiate certain types of contracts again and again, such as nondisclosure agreements, license agreements, master service agreements, etc. In the typical organization, these types of agreements are negotiated as needed. Often, the party negotiating the contract has a preferred form he or she uses, depending on the type of agreement required, and each negotiator will have