A Day in the Life of a Contract Manager

In years passed and even today, Contract Mangers are often fighting an uphill battle as they relentlessly seek to ensure that the contracting process within their organization is simple, accessible, efficient and actionable. Meanwhile, the business user constituency at large has a very limited level of appreciation and patience for our beloved Contract Managers. As a result, today’s Contract Professionals must continually demonstrate value in the midst of getting their day-to-day activities completed. And this begs the question, what do today’s progressive contract managers do? What do they focus their energies on, and how do they have the most significant impact on their respective organizations?

Truth be told, when first conceptualizing this blog, my initial inclination was to focus purely on the common responsibilities associated with most of the Contract Managers we see in action. However, after further consideration, I thought if we did not provide tangible examples of how those activities impact the business and user constituency, the article would do a disservice to this dedicated group of contract professionals and the value they introduce every single day.

Three additional qualifiers worthy of sharing. First, while the blog references a “day”, this commentary is, of course a broader collection of activities that are typically tackled over an extended period. Second, the activities associated with managing contracts are materially influenced by what parts of the “contracting elephant” (see link on article by our CEO on the World CC site) are being addressed by contract professionals. Third and last, these activities are also largely impacted by the use (or non-use) of contract management software.

In a semi-practical order of precedence and with segmentation by Pre-Execution, Post-Execution, and “Execution Independent,” most but not all day-in-the-life-of activities of contract managers include the following:

Pre-Execution Activities

These activities pertain to all the action taking place prior to the original/initial contract being signed. It starts with the initiation of a request and typically concludes with the actual finalization/put-away process for the contract and related initial documents.

Activity - Contract Intake Request Processing | Starting with the basics, business users across an organization (sales, marketing, operations, R&D, etc.) need to transact with customers, suppliers, partners, employees and more. And with that need to transact comes the need for contracts and more specifically being able to support a streamlined process for handling those requests. Requests can be segmented into four common types; Legal Assistance, Creating a contract from an internal template, filing an executed agreement (from outside the system – shame on you business users) and supporting requests that are accompanied by contracts provided by 3^rd parties.

• Business Value | Facilitating this activity represents the first critical step in managing contracts. Optimizing this process introduces the necessary support to establish commercial and legal terms and conditions to conduct business with others. Without support for this activity, businesses will typically spiral as business needs to get done.
• Contract Management Software Impact | When contract management software is employed, a streamlined process with wizard-like experiences can be introduced to enable self-service for the user community, to establish consistency in the process and to provide real-time visibility for all as to where the request is at in the process.

Activity - Contract Preparation & Review | Once a request has been received, Contract Managers must now work on the prose of the contract and that will be substantially impacted by the source of the contract (internal vs. 3^rd party), the nature of the contract (standard or a one-off) and the industry being served (not regulated to highly regulated). In all capacities, Contract Managers must be on their game to ensure that the corrective provisions are employed, to ensure that the organization is properly protected and that the terms and conditions are well-defined.

• Business Value | If this activity is not taken seriously and with the proper investments in protecting the interest of the company, unnecessary risks are introduced, and the entire process becomes incredibly inefficient.
• Contract Management Software Impact | Contract management software can be used for purposes of employing standardized contracts, incorporation of a centralized contract repository, and a means by which to easily review contracts in a proactive and more beneficial capacity.

Activity - Contract Negotiations | As much as we all believe we prepare completely balanced agreements, it is reasonably safe to expect that your counterparty may feel differently. As such, contract professionals are regularly involved in the initial and ongoing redlining and exchanges of contracts and supporting documents.

• Business Value | Contract managers can introduce and refine language to ensure your business interests are well-protected and optimized. By the same token, contract managers are also typically looking to structure the contract such that if provides a vested outcome for both participants. Finding this balance requires incredible insight and experience as well as forward-thinking intuition.
• Contract Management Software Impact | Contract management software can materially impact the negotiation process by providing a vehicle to send and receive contracts with automated redlining capabilities. This provides a clear chain of custody with proper version management.

Activity - Liaison With In-house and Outside Counsel | When the legalese of a contract requires legal counsel, contract managers play a vital role in setting the stage for the attorney, providing opinions and recommendations, and working collectively to optimize the best language for the deal. Interactions with counsel will vary based upon these people being in-house or outside counsel, and the amount of interaction cannot be underestimated.

• Business Value | The insight and fortitude of an experienced contract manager will allow attorneys to provide maximum value from counsel. By being well-prepared, contract managers can make the process much more efficient and can also help de-risk negotiations as they provide guidance to the attorneys.
• Contract Management Software Impact | When contract managers are engaged with attorneys, contract management software can provide a powerful vehicle to make the entire process more efficient as correspondence can be more easily tracked, and there is a simplified and more consistent source of truth.

Activity - Liaison With Users, Approvers and Reviewers | Most business users and those involved with contract reviews and approvals, do so occasionally. As such, they often need assistance in what they should do, when they should do it, and the types of decisions that need to be made. To this end, the contract manager plays a vital role in moving a contract through the process and serves as a sounding board for the user community at large.

• Business Value | Contract managers serve as the vehicle to ensure that the contract process proceeds and that in short, deals get done in a way that is well-suited for the business.
• Contract Management Software Impact | An elegant and simplified user experience will allow for users to gain visibility into their contract requests and approval requirements that would otherwise be constrained by contract managers having to service such requests. With contract management software, users can easily check on the status of their contracts, have ready access to their tasks, and get automated alerts as contracts progress through their lifecycle.

Activity - Signature Pursuits | As well all know, most contracts require some form of signature; be it one, two or more signatures. And while we wish everyone used e-signature, the reality is that wet signature is still a reality for many organizations, often region/jurisdiction or company dependent. To this end, a contract manager is often chasing down signatures for different transactions and staying on top of the status of the signature to ensure that the deals move forward.

• Business Value | Contracts without signatures are typically considered worthless and the importance of having contract managers ensure that they are fully signed and with the right information (titles/dates/etc.) This is key to ensuring the contract can be considered properly executed.
• Contract Management Software Impact | Any contract management software worth its salt will provide some form of e-signature integration and this can play a pivotal role in extracting more value out of the system. Key factors introduced by contract management software include automatically sending documents out for signature (or assigning tasks to process wet signature), real-time visibility and alerting as the contract is being signed, and automatically importing the fully executed contract back into the software repository once executed.

Post-Execution Activities

These activities kick in once the contract has been executed and commitments and obligations necessary to support the contract and its performance are required.

Activity - End Of Term Processing | Most contracts expire, renew, terminate or perpetually go on; all of which require careful maintenance and attention and something here at Corridor we call out as “End of Term processing”. Staying attune to what activities need to take place, prior to the end of the term as well as after the end of term, are typically activities that are handled by the contract management team. The implications for not tending to this important issue are critical and often require some form of negotiation as end of term dates are approached.

• Business Value | The business implications of not taking this aspect of contract management are substantial. For customer contracts, this may be an opportunity to upsell, make adjustments and check-in with your customer. For suppliers, it may be an opportunity to renegotiate pricing, expand (or reduce) the relationship and introduce new conditions that are better suited for your current working environment.
• Contract Management Software Impact | While not the heart and soul of contract management, the ability to support end of term processing is comparable to the blood flowing through your system. Contract management software can very effectively manage these dates, reset new dates, and send out ticklers and escalations as needed to ensure that end-of-term dates are not missed.

Activity - Supplemental Document/Contract Creation & Processing | While many contract processes stop once a contract is signed, there are a large percentage that continue with all sorts of amendments, addendums, states of work, change orders, etc. As these supplemental documents and child contracts are being produced,  they frequently must undergo similar approvals and signing processes as their master agreement. Contract Managers are intensely involved in this process when supplemental documents and child contracts must be processed as part of the ongoing business relationship with counterparties.

• Business Value | These supplemental documents and child contracts often represent a substantial income and/or expense stream that must be carefully managed and controlled. Without the insight and management prowess of a contract manager, this process could become unnecessarily costly.
• Contract Management Software Impact | The impact of contract management software for supplemental documents and child contracts provides a level of uniformity in terms of templates, processing, notifications, and reporting and, as such, requires careful attention.

Activity - Compliance & Obligation Management | While a certain percentage of contracts will simply remain compliant by virtue of end of term processing, there is a large percentage of contracts which require on-going attention due to the obligations defined in the contract. When SLAs are established, key dates or deliverables are defined/required and certain activities need to take place; compliance and obligation management activities are necessary. Given the complex nature of such contracts, these are often activities handled by skilled contract managers. These obligations must be 1) identified and extracted, 2) memorialized and managed, and 3) acted upon proactively to ensure your organization (or the counterparty) remains compliant. There is also a critical reporting component to this, with risk registers and other forms of tracking to ensure that contracts do not spiral out of control.

• Business Value | World Contracting and Commerce (www.worldcc.com) , formerly IACCM, reported the impact of poor contract performance reducing gross revenue by 9.2%; of which a large portion of that allocation is attributable to compliance management. Even if reduced to 1%, the financial/business impact can be substantial.
• Contract Management Software Impact | Contract management software is designed to support the memorialization and processing of obligations and provides the necessary vehicle to ensure that contracts perform in accordance with the obligations stipulated in the language of the documents (initial and supporting).

Execution Independent Activities

While there is some real shape to pre and post execution activities, there are some activities typically addressed by Contract Professionals that traverse all dimensions and require supplemental effort. Often conflicting with one’s “day job” of managing contracts, these activities are typically associated with the systematic management of contract management software.

Activity - Contract Management Administration | While there are indeed organizations that have dedicated contract management administrators, a large percentage of organizations using contract management software typically have contract managers assuming some level of responsibility for the design and administrative maintenance of the system. This may include creating new contract types, workflow rules, security settings, validation data, and support of the system more broadly for the user community. The level of effort/time associated with the contract management software administration is directly related to whether an organization is in an “innovation” state, a “maintenance” state, or someplace in between. When innovating and serving as the primary administrator, typically, much more time will be needed as analysis, design, and testing must take place. If in a maintenance mode, the system does not require the same level of participation, and consequently, involvement is reduced.

• Business Value | if contract management software is in place and has been implemented properly, the business value of that system can be substantial as it introduces efficiencies, standardization and reduces risk.
• Contract Management Software Impact | Dependent upon the software being in-place or not.

Activity - Template & Clause Management | While the management of standard templates and clauses are certainly a key part of contract management, it is also a necessity to maintain templates and clauses without contract management software. Consequently, the maintenance of these standards typically falls on the shoulders of our trusted contract managers. For intense legal language, attorneys may also be involved; however, contract managers typically bare the brunt of maintaining this information. Since templates and clauses are regularly being updated and there is a need to track which templates and clauses have been used for each respective transactional contract, the effort to maintain these templates should not be minimized. This is intensified if fallback clauses and alternative templates also need to be maintained (and include others for approvals).

• Business Value | The importance of having standard templates and clauses sets a precedent in terms of heightened efficiencies and reduced risk as the contract management/legal team controls which templates and clauses are being used for new contracts. With a trusted set of these in place, heightened levels of standardization can be achieved much more easily.
• Contract Management Software Impact | Standardized templates and clauses are typically considered table stakes for most if not all contract management software which offers support for pre-execution activities. Contract management software can introduce accelerated ways in which to standardize this content and allow for them to be automatically generated with the inclusion of variables and conditionality based upon the completion of a form.

Activity - Liaison with IT In Support of Contract Management Software & Related Technologies | One of the last bastions supported by the contract managers is that of lesioning with the IT team in order to support a contract management software system. The level of involvement will vary broadly based upon the relationship between the contract management team and IT and the personalities and skill sets of each participant. Innovation state or steady state will influence the level of communications, follow-up, and general activities between contract managers and IT to work together.

• Business Value | The collaboration between contract managers and IT is a necessity as the management of contracts warrants investments in technology; be it with or without contract management software. When the unison of contract managers and IT are working well together, the business value derived from their efforts is readily experienced as efficiencies and risk reductions are introduced.
• Contract Management Software Impact | Contract management software mandates some form of IT support. With a strong implementation plan, coupled with an equally strong change management system, contract management software can serve as a substantial efficiency vehicle.

These activities, while not all-encompassing, do provide a strong representation of the most common activities being performed by contract managers. The exact composition will vary substantially by organization, number of contract managers and how broad the responsibilities are for the person or group. Hopefully, this serves as a strong starting point to understand the magnitude and depth of what contract managers do day in and out and how we need to support them as much as possible.

Contracts 365 –Leading Contract Management Software for Microsoft 365 Customers

f your business counts on contracts to function, then contract management software may be right for you. Contracts 365 is the leading contract management software for businesses that run on Microsft 365. With usability, functionality, and security at the forefront of development, Contracts 365 addresses all aspects of the contract lifecycle through a modern, intuitive interface specific to your users.

If you would like to learn more, please don’t hesitate to reach out to us or, even better, request a demo, and we can show you how it works in real-time.