Understanding your contract landscape

February 24, 2011

Understanding your contract landscape should be the first key stage of an enterprise contract management strategy.

Contracts are central to the way that business is conducted. As business-to-business transactions become more international and complex, so too have the contracts that support those transactions. Contracts contain a myriad of milestones, commitments and obligations that need to be identified and tracked in order to manage contracts effectively.

Lost or hard to find contracts
Unfortunately for many companies, much effort is put in to the negotiation of terms and conditions and less attention to what happens to the contract once it has been signed. Contracts that should be proactively tracked and managed end up lost or hard to find in file shares, computer desktops and other repositories.

Three key questions to ask yourself
Here are three questions that should be asked as a litmus test to assess the level of visibility and control over contracted commitments:

  • Do you know exactly how many active contracts your company has?
  • Do you and other key stakeholders in your company have visibility of all contract milestones, commitments and obligations?
  • Can you demonstrate to your senior management team that all contract related commitments and obligations have been complied with?

For most General Counsels, there are two options to address the issue of legacy contract visibility:

  1. do nothing
  2. conduct a time consuming, complex and expensive audit using specialist external consultants.

Dolphin AutoCapture – the legacy contract discovery engine
Dolphin AutoCapture is the first legacy contract discovery engine that uses search and artificial intelligence-based technologies to:

  • Rapidly locate lost or hard to find legacy contracts in Windows File Shares and computer desktops
  • Automatically extract key contract milestone data from contract documents
  • Present key contract related data to senior managers in a simple management dashboard.

Dolphin AutoCapture automated contract audits are significantly faster and cheaper than conducting manual audits with external specialist consultants.

Understanding your existing contract landscape should be the first stage in your contract management strategy.

Free webinar
Join Dolphin Software for a free-to-attend web seminar to find out more.  Visit http://dolphin-software.com/lp_contract_landscape.htm for further information and to register.


Is Microsoft SharePoint ready for mission critical business applications, like Contract Lifecycle Management?

February 15, 2011

A recent market survey published by Global 360, entitled:  How are businesses using Microsoft SharePoint in the Enterprise, highlights the significant strides that Microsoft SharePoint has taken in the last year in terms of enterprise adoption.

The Global 360 survey polled over 800 companies in 2010.  Here are some of the key highlights:

  • 90%  – organizations surveyed have and use SharePoint
  • 97% – organizations who will look to deploy SharePoint
  • 67% – have deployed SharePoint enterprise wide

The phenominal growth and adoption of SharePoint in the enterprise is truly disruptive to traditional ECM and collaborative incumbent technology solutions.  Of the 3% of organizations who were not currently looking to deploy SharePoint, most companies admitted that they would be considering SharePoint at some stage in the future. 

The table below shows how Microsoft SharePoint is currently being deployed amongst the organizations surveyed:

How widespread is the deployment and usage of Microsoft SharePoint in your organization?
Use within team or single SharePoint project site 4.94%
Limited SharePoint sites or department use (1-3) 11.03%
Several departments (4 or more) 16.98%
Enterprise-wide deployment of SharePoint 67.98%
Total 100%

With market saturation within reach, the big question for CIOs must be:  Is Microsoft SharePoint mature enough as a platform to deliver enterprise applications?

The Global 360 survey would suggest that this is rapidly becoming the opinion of SharePoint users.  Here is a summary of some of the key findings about how SharePoint is being used within the enterprise:

  • 67% – organizations using SharePoint for enterprise Document Management & Workflow
  • 27% – organizations who use SharePoint to support mission critical business processes

So, nearly one third of SharePoint users now deploy SharePoint to manage mission critical content and to support key business processes.

CIOs and IT strategists must now seriously consider business applications built on top of the Microsoft SharePoint platform that support critical business processes and compare the pros and cons against other enterprise platform solutions from SAP, Oracle or even .Net and Java based applications.

There is one significant fly in the ointment as far as SharePoint in the enterprise is concerned, however.  51% of companies surveyed complained that too much time and internal resources were being tied up trying to develop point and line of business solutions in SharePoint.

This is precisely where independent software vendors like Dolphin Software can help organizations and add value to SharePoint environments where it is most needed.  Most organizations do not, and should not, consider themselves to be software development houses.  Microsoft SharePoint has matured to an extent that it is now a viable platform for delivering robust business applications, but it should be considered as such – a platform. 

Dolphin Software would consider itself first and foremost as a best-in-class Contract Management software vendor that uses the Microsoft SharePoint platform as a delivery mechanism to its business users.  This has several advantages for Dolphin’s customers.   From a CIO’s perspective, a comprehensive SharePoint based business application, like a contract lifecycle management solution, is a compelling example of how SharePoint can add value in a business context.   From the business user’s perspective, a SharePoint based business application should be familiar and easy to use and therefore easier to deploy to enterprise users.

For further information about deploying mission critical business applications, like Contract Lifecycle Management on the Microsoft SharePoint platform, visit: www.dolphin-software.com

Dolphin Software CFO Mark Williams – Is contract management becoming more complex?

February 9, 2011

CIO and Computerworld magazines recently published interviews with Dolphin Software’s parent company CFO being interviewed about whether contract management is becoming more complex.

Read the CIO Magazine article here:  http://tinyurl.com/4lf6bfw

HR contract management and why it is important for your business

February 6, 2011

Many companies admit that they could do a better job when it comes to contract management.  However, those companies that do consider contract management solutions, usually only consider operational contract processes, like procurement or sales contracting.

HR often gets left out in the cold.  It is fair to say that some business executives still view a contract as a  tactical ‘insurance’ policy for when things get difficult.  World class organisations who look at contract management from a business critical and strategic perspective, view contracts as the outline of the business relationship between themselves and a third party – with terms and conditions, that if effectively managed, can be exploited to maximise commerical gain or minimise risk exposure.

So why should a business care about its HR contracts?  There are several areas where deploying a contract management solution to automate the HR contract process can provide significant benefits.

First and foremost is staff turnover.   Average staff turnover for US organisations is 15% (closer to 100% in the fast food industry), according to a recent report by Nextera.  This can produce a significant burden on HR functions and business managers looking to contract with new permanent or temporary staff.  Contract drafting for most companies is a slow and manual process that involves duplication of effort and multiple stakeholders. 

Self-service contract authoring
Self-service contract authoring solutions, available in contract mangement solutions like Dolphin Contract Manager, allow business managers to create tailored and compliant contracts by answering questions provided in online wizard-driven questionnaires.  Contract Managemnet solutions with self-service contract authoring will automatically save contracts created in a central repository and can instigate internal approval workflows.  These solutions also make contract amendments, when employees change role, a simple and rapid possibility.

Implementing organisational change
Senior business executives who are looking to restructure their businesses have a need to have accurate and timely information about their human resource pool in order to assess how rapidly and smoothly they can instigate organisational change.  Information like length of service, termination terms, remuneration and notice periods are all required, but it many cases, current and accurate data relating to HR contracts is not easily accessible.  When employment agreements are lost in the myriad of corporate file systems, it can be even harder to efficiently gain access to contract-related information.  Contract Discovery solutions, like Dolphin AutoCapture, aim to make locating lost or hard to find contracts a thing of the past.  Dolphin AutoCapture locates lost contract documents in Windows file shares and computer desktops, automatically extracts key contract milestone data and uploads the contracts and data seamlessly in to the Dolphin Contract Manager system for proactive tracking and management.

Managing HR contract related litigation
Digruntled employees who sue their employers is a common cause of contract related litigation and costs businesses millions in disruption to business, expenditure on external legal and audit and discovery services, particularly when the current version of the employment contract cannot be readily located or where the contract has not been updated to reflect changes to the employees role or employment status.

Human Capital Management
A growing number of companies have begun to look at managing their people and talent as resources that have a financial value to their business.  Human Capital Management and the on-going requirement to enhance the training and qualifications of employees to enhance their asset value, requires micro-management of contract related terms and conditions to extract the greatest value and potential.

Managing outsourced service providers
For those businesses who have outsourced their Human Resources function, will be be aware of the need to manage contract milestones, performance targets and obligations closely in order to maximise the value and savings expected when key business functions are contracted out to third parties.  Contract Management software is key to allowing HR and key business stakeholders with the right management information to manage these relationships effectively.

In short, contracts are central to Human Resources and HR executives who are looking to improve efficiencies and erradicate unnecessary cost and risk in HR contracting should consider deploying a contract management solution.  Dolphin Software holds regular free to attend web seminars.  Visit: www.dolphin-software.com/events.htm for more information.

Internal Controls audits and Contract Management

February 3, 2011

Infraco, the South African government-owned Broadband and long distance telecommunications provider, has been cited in a recent Deloitte audit report for a failure in internal control processes in the company’s procurement and contract management environments.

“Although there are set policies, procedures, guidelines and processes to effectively effect the contract management process, we noted in many instances that these are not complied with, unintentionally or otherwise”, stated the Deloitte report.

An increasing number of companies all over the world are failing internal controls assessments conducted by independent auditors as auditors become increasingly concerned over the lack of visibility and control that many companies have over existing contracted commitments and overall contract management procedures.

The majority of companies put most of their effort in to the negotiation of contract terms and conditions, but do not dedicate the same level of attention and oversight post contract award.   This is largely because legal and business executives still do not consider contracts to be mission critical or strategic to their businesses.  For many, a contract is viewed as an insurance policy for when things go wrong.  Clearly auditors and industry observers, like the IACCM, see this as an outdated view and one that will only lead to increased scrutiny by auditors and regulators.

Contracts are strategic documents that outline how two parties are to collaborate with each other and the terms and conditions that govern that collaborative relationship.  For those companies that are able to manage and control their contracting processes efficiently, greater competitive advantage can be achieved through cost savings in the pre-award contracting process and better exploitation of contract terms, conditions and obligations in the post award process.

Dolphin Software would argue that the most effective way to bring about total control of the contract management process and ensure that contract obligations are properly complied with is to follow clearly defined contract management procedures, to appoint a senior executive to oversee contract management from a strategic position and to automate inefficient manual processes and control contract milestones and commitments more effectively with technology.

CFOs will rapidly understand the strategic importance of effecive contract management if their auditors refuse to sign off their accounts.

**24 February 2011 – update**

Broadband Infraco CEO and Non-Executive Director resign

Dave Smith, CEO of Broadband Infraco, the South African state owned entity tasked with bringing down the cost of broadband, and Non-Executive Director Tumi Magasa have resigned with immediate effect as a result of their recent contract management woes.

In October last year audit firm Deloitte was commissioned to conduct an urgent internal audit “to review the controls in relation to the contract management function, evaluate the adequacy and effectiveness of key operational and financial controls, and test compliance with the applicable legislation, policies and procedures”.

Dolphin webinar: Using Microsoft SharePoint for Contract Lifecycle Management

January 27, 2011

Microsoft SharePoint 2010Contracts govern the way that companies conduct business relationships with each other. As business becomes more international, contracts and agreements become more complex – with terms, conditions, milestones and obligations to keep track of and manage. Unfortunately, for many companies, the contracting process leaves a lot to be desired, increasing the chance of missed commercial opportunities, costly penalties for non-performance or missed obligations. Try answering some of these questions for example:

  • Do you know where the latest versions of your key contract templates are?
  • Have you ever cut and pasted terminology from previously authored contracts?
  • Do you use email as the mechanism to review draft contracts with colleagues?
  • Do you save all contract documents in a secure, version controlled repository?
  • Do you receive alerts and reports when key milestones and obligations are due?
  • Are you able to guarantee that all contract milestones and tasks have been complied with?

Dolphin Contract Manager is the world’s leading Contract Management solution for Microsoft SharePoint environments.

This SharePoint-based solution means that your IT team can use the same SharePoint infrastructure to provide enterprise-wide contract management capabilities. Because Dolphin Contract Manager is SharePoint-based, your business users will also find its user interface and menu systems instantly attractive and familiar, reducing the need for end user training.

Register here for this complimentary web seminar to learn more about how Dolphin Software can help you make the most of your investment in Microsoft SharePoint and automate and control your contracting processes. Register now or contact us for a personal demonstration.

Can legal do a better job at supporting sales contract management?

January 26, 2011

The International Association of Contract and Commercial Managers (IACCM) are currently polling legal and contracting professionals to record their thoughts and opinions on how contract management is handled in the companies that they work for.  One of the early conclusions of the survey (which can be accessed here:  https://www.surveymonkey.com/s/StateofSalesContractManagement), is that many sales and commercially focused staff still view Legal as being too risk averse and a cause of inertia in the commercial or sales process.

Perhaps, Legal would argue, that if they are not going to be risk averse and cautious, who else in the organization is going to be?  On the other hand, with quarterly sales targets to meet, it is faster (but thorough) contracting that is required to facilitate risk managed, but commercially optimized deals.

Contract Management software solutions, like Dolphin Contract Manager do have a key role to play here.  The contracting process for many companies can be manual and inefficient.  Technology based solutions that support the contracting process can reduce contract cycle times and allow key stakeholders, like Legal, to add value in the right places and at the right time, instead of having to become involved in all transactions that tie up limited legal resources.

Self-service contract authoring, where non-legal users, like sales teams, are able to create tailored contracts and agreements by completing intelligent questionnaires is a major development in corporate contract management systems.  Previously technology that was used by law firms to automate the creation of standardized contracts, is now available to free up legal resources so that they can focus on the exceptions and non-standard contracts.

Legal clause libraries that allow legal language to be formatted in to reusable objects and then used to speed up new contract drafting or to be inserted in third-party contracts during contract negotiations, also play a significant part in empowering key business stakeholders in the contracting process, while legal maintain an oversight role.

Providing a central electronic repository for contract documents with version control and security profiling would seem obvious, but it is surprising to see how many companies exercise little or no control over where contract documents are stored.  Without strict control mechanisms in place, an organization will soon lose control over contracts and commitments contained within them.

Post-award contract milestone and obligations management is typically lax in many organizations, and it has been suggested that perhaps legal advisors take an overly conservative and risk averse stance when the focus of the contract is on its worth as an insurance document in preparation for when there are breeches, rather than as an outline document detailing the commercial relationship between the two parties.   After all, over 60% of commercial litigation matters now relate to contract disputes.

If legal resources can be freed up to focus on non-standard and exceptions and if there is an efficient and effective way to proactively manage contracted milestones and obligations, then perhaps we will be able to see the legal team being able to spend more time overseeing the contracting process and adding value where it is most needed.

Dolphin Software has recently published a new white paper entitled Why contract management should be a strategic imperative for your business, which can be downloaded here: http://www.dolphin-software.com/lp_cm_whitepaper.htm