Contract Lifecycle Management: What we are talking about when we say “Self-Service”

A hot topic in CLM that has a lot of meanings

 I truly love jargon. If you doubt this, please look at my other 49 blogs. I particularly love when a word or phrase becomes so ubiquitous that we collectively forget what it actually means or more specifically, what it really is in practice. “Self-service” in contracting is getting there. You can see it happening. 2020 jump-started the need to use CLM technology and also revise the processes and teams who actually make contract and commercial management work (See joint Deloitte & World Commerce & Contracting Report “When Technology Meets Humanity”). There is a lot of talk and need to make legal and contracting teams more efficient and a common answer now is to “take it off the lawyers’ desks and give it to the business.” Sounds good right? But where is it going and how are companies really tackling this?

 Now I am a big fan of self-service and a proponent of the dual ideas that: (1) contracts are owned by the company; and (2) people can read – lawyer or “non-lawyer”. But what does “giving it to the business” really mean? Over-simplistically this is like home repair. Of course, you know how to change a lightbulb, unclog a sink, hang some pictures, paint a wall, etc. But you also know when you need a proper expert to rewire a bathroom, install a new sink, add a window or knock down a wall. However, this is not what we are talking about when we get to self-service, because the aforementioned all rely on individual decisions, experience levels, comfort-levels with power tools and risk tolerance. In order to get real benefits from a self-service contracting approach, organizations have to be a little more clever than “let the business do it” and invest some time, thought and energy upfront so they can do nothing later on – a bit like my life goals. To help us frame this, why don’t we run through some “self-service” options through the analogy of pizza. We’ll use the lawyer or commercial expert as the “chef” in this framework and the “you” as the business. 

Do it completely yourself: Frozen Pizza

Frozen pizza is a model marvel. Buy it, unbox it, heat it and eat it. We do live in the time of miracles. However, it’s a tad limited in form. You shouldn’t do much more than I suggested (maybe some seasoning) and the format really doesn’t want you to much more. In summary it’s like automatic NDAs with esignature. Add some names and email addresses, press some buttons and voila! You now have a signed agreement. Limited value in a way, but high marks for simplicity and usability. This really is the table stakes today and if your NDA or infrastructure are not setup to do this already, I do encourage you to stress test that. To be fair, this isn’t just for NDAs and companies do go higher up the complexity chain in this mode. Teaming agreements, ultra-simple staff-aug/consulting agreements and some ancillary SOWs (or really Purchase orders) can fit within this format. But just like some microwaveable meals, there comes a point where the need for greater complexity and nuance outweighs the need for simplicity, e.g. 2-minute burrito is fine, a proper carne asada, not so much.

To get to this level of use though, there is work up front to make the easiest document that can simply just be “heated” and used without any intervention. Companies will fail on this if they don’t think of how the end use or other party will want to use the document. You saw this when companies only made their 1-way NDA available. This led to more escalations to get to the 2-way NDA which is much more common. A little thought upfront helps in the work down the road.

You have SOME choices: Chain Pizza Delivery App

 This is the area where there has been the most development in the last few years – both from a contracting side and food delivery perspective. With pizza apps, they used to be pretty basic. One could order from a pre-selected set of pizzas and then use dropdowns for varieties on size or crust type and then add some ancillary food ideas such as beverage or deep-fried what have you. Much better selection than the honourable frozen pizza, but still trapped with the format and any nuance called for a phone call to the actual shop. This was similar to basic authoring tools. One could easily pick a template and then use dropdowns or free script in pre-ordained areas to add things like party names, product type, addresses, maybe price or payment terms, but not much else and any nuance required a call or escalation. Better than an instant NDA, but really trapped within the format of the template. But nowadays we are in a brave new world. 

Delivery apps now remember your preferences based upon all the data they collected on you. More advanced tools allow you to go into the options and pick and choose (with a preset limit) the nuances of your topping selection within a format (maybe you don’t want ALL the meats), “build your own pizza” or even get a “half & half”. This model cuts down on the calls to the pizza shop, keeps you in the platform and makes the process much more efficient. The good apps even let you track where your delivery is in the queue and time to arrival. Really good contract authoring tools do the same! Rather than using a basic template, there are now clause libraries backing up your selections. The AI in the tools will note what you (or what your organization is doing as a whole) for preferences in certain areas and give suggestions based upon trends which are focused on reducing negotiation time. The additional and wider selection of clause allows for more nuanced “assembly” of the contract with less calls to the lawyers or commercial leads. 

You are seeing companies do this with a whole suite of procurement documents or basic sales agreements (under a threshold) and reap huge benefits in time to contract, money in the door and releasing lawyer/commercial time. But this takes thought, design and effort. Companies that get really good benefits and less escalations do the work. They simplify their contracts, map the clause library, configure the tool fully, collect the information and have a continuous improvement cycle to revisit the clauses to ensure: (1) they are still relevant and (2) see where they can push this further. Companies that are frustrated by this idea typically don’t have clear rulebooks or have taken old templates and put them into a modern tool without putting in the work. Trust me, I’m from New Jersey. Taking frozen pizza and calling it “delivery” just won’t fly.

With some instructions, you can do this: Cooking Class

 So, you think you can make a pizza? Seems simple right? But anyone who has worked in a proper pizza restaurant knows it’s all about the dough. Good pizza starts with really good discipline and care about what goes into the dough and how its constructed. Sauce, toppings, cooking method (please use wood) all matter, but it starts with the dough. The recipe for the dough may sound simple and the directions are relatively short, but it takes time to teach someone how to properly do it and an acknowledgement that the first time probably needs a bit more guidance than the 20th time. Same thing can be said about training the business teams to “cook” on their own. Companies have been doing this in a variety of ways for some time, but now it is becoming more and more common and broader in use. The “business” has been drafting work orders or SOWs for some time now – whether they were officially sanctioned or not. The change now it that companies who are seeing the benefits from more of the “pizza app” version of self-service and who have gone through the work of simplifying their contracts, making intuit clause libraries and making decision making transparent are coming to the realization that this can go further. Companies are revisiting their old “contract awareness” training curriculums and seeing that with more investment and structure the business teams can handle more and really want to handle more. This is not to say that everyone can be a pizza chef and open their own restaurant, but with some investment of time they can cook for themselves a bit more. 

To bring the analogy back full circle, it goes back to the dough, or in this case the contract. Organizations that invest the time in getting a really good, working document that is more of a business document than a pile of legalese with some commercial terms jammed into it are seeing just how much can be done outside of legal or contracting teams. The key here is that just because the contract is good and the team is good, you don’t fall into the trap of “gourmet frozen pizza”, which frankly is an oxymoron in my opinion. Companies that do this well provide solid contracts, good training and good discipline about self-audit, risk reporting, logical signing authority and escalations. This takes a bit more design work to setup the structure that empowers the business, sets clear rules and then has a way of reporting on deviation or escalation. In all that there is investment up front, but proper “business as usual” correlates to faster contracting, clear risk profiles and reporting, and less legal/contracting time. Do more now, to avoid doing so much later. 

Self-service is great idea whose time has truly come in contracting. Hopefully this has led to realize that it comes in a variety of shapes of sizes, requires some work upfront to make it work, but also leads to benefits. As an ancillary to that, I suspect you may be hungry for pizza. I am.