Too Much Sales Time Spent on Contracts

“In many organizations, up to 25% of sales time is spent on contract-related issues,” states Tim Cummins on his blog Commitment Matters. Tim is president of the IACCM, a non-profit organization that’s become the global forum for innovation in trading relationships and practices.

This is astounding. As we emerge from a very deep recession (knock on wood as GDP came out positive this week), organizations around the world are struggling to do more with less and to close sales more quickly. How do you do this when 25% less time is spent selling or prospecting?

An alternative to the manual, slow and risky process of creating contracts and sales documents such as NDAs and proposals, is to use document assembly/contract automation software. These solutions allow sales reps to create structured, approved sales documents on the fly by answering questions in a browser. These systems can integrate into the CRM system so the sales rep doesn’t have to re-enter data and all contract data can go back into the system. This allows the company to also manage, analyze and report on these contracts.

Another interesting subject touched on by Cummins comes from a report by CSO Insights on Sales Compensation and Performance Management. It talks about how the recession has caused many sales reps to miss their quotas and to begin to push the boundaries of what is ethical. The report goes on to say that sales reps state that the biggest cause for losing business is the “competitor’s price and terms.”

And this brings us full circle back to contract automation. If you automate your sales contracts and capture the data, you can control what the rep can do with the Ts & Cs and give them some controlled flexibility to negotiate on their own as well. You can also risk- rank your contracts and start to compensate your reps not only on revenue but on the value of the underlying contract to your company.

Dow Jones & DLA Piper joined us for a webinar on this topic: "How sales teams can reduce the time and expense of closing deals by 50%" Download the recording now.

Document Assembly Software Explained & Reviewed

Noted document assembly expert, Seth Rowland, has written a beginner's guide to Document Assembly that does a good job of explaining how document assembly software works.

Document Assembly goes by many different names, depending on the related job function and industry. It can be called document automation, document generation, contract automation, policy configuration, loan documentation, document creation and many more. For simplicity, we'll stick with document assembly here.

Recently, Seth reviewed Exari Document Assembly Software in the TechnoFeature Newsletter. Below are some excerpts:

• In evaluating a document assembly system, one must look at what the user sees when he or she launches the document assembly interview. If the user's experience is "pleasant"; if the user can easily navigate the questions; if the user is guided to make the correct choices; and if the user can easily review and change his or her answers, then you can say that the system succeeds. The Exari interview shines in each of these areas.
  


• At the end of the interview, Exari presents you with several optional outputs including Word and PDF. The most interesting option is a document preview. You can see the document with variables and optional text indicated...Exari adds a further output option that is unique in the document assembly industry. Called the Exari RoundTrip, it produces a Word document that can be negotiated and edited.
  


• Exari has just about every feature you could imagine for a document assembly system. Variables and various other components, just like documents, are stored as XML objects. Exari has variables, conditions, repeats, calculations, conditional expressions, multiple choice questions, and user text questions. To the standard list, Exari adds smart phrases, blocks of text that are reusable in the template and may or may not contain conditions, variables, and logic.
  


• Exari includes several other components that round it out as a robust and powerful programming language.
  


• Clearly, you'll need to conduct a return on investment analysis. Look at the number of users who will use the system, the number of documents they will assemble, the location of the users, and the level of expertise among the users regarding the documents. In the proper setting, Exari will pay for itself in under three months after full production.

You can read the complete review here. And please, let us know what you call Document Assembly below in the comments.

The 4 key challenges of contract management for law departments

Well known legal department consultant, Rees Morrison, reminds us of the four key challenges contract management poses for in-house lawyers:

1. Standardizing and simplifying contract drafting.
2. Setting policies regarding legal department review of contracts.
3. Streamlining contract negotiation.
4. Facilitating the company's adherence to its contractual obligations.

Morrison notes the role of document assembly in addressing the drafting issue. Interestingly however, all four issues can actually benefit from a document assembly solution.

1. Contract drafting
Most legal departments try to improve contract drafting by using MS Word templates. However, these create problems for all parts of an organization:

• Business users hate Word templates. Their eyes glaze over when they see square brackets and verbose user instructions. Instead, they either ask Legal to do the work, or they cut-and-paste from a previous agreement.
  

• The lawyers are unhappy too. Word templates are too risky. Often, business users can't get the substantive terms right and Legal has no visibility into the deal.

In contrast, document assembly enables drafting to be pushed out to the business as a self-service model, while ensuring the generated agreements are legally compliant. The business users are guided through an intuitive web interview. The lawyers retain control by pre-determining what content is included. Further, PDF output ensures that the business user can't modify the document post-production.

2. Contract review
For legal departments with contract review policies in place, document assembly systems can enforce those policies by embedding them into the system as rules.

When there is non-compliance with a rule (e.g. in answer to an insurance question, a user might respond that the counter-party has insufficient insurance), the system automatically routes the contract to the legal department for review.

3. Contract negotiation
Document assembly can improve negotiation in two ways:

• By building commonly negotiated fall-back scenarios into the system (with different answers triggering the inclusion of particular provisions) the negotiation process is made much faster.
  

• Some systems can actually capture all edits made to a document after it has been generated. That ensures any changes made by a counter-party are visible (even if MS Word Track Changes has not been used). Further, these negotiated positions can even be applied to subsequent agreements such as renewals.

4. Contract tracking
Typically, there is both a functional- and system-separation at the point of contract execution. Pre-execution work (drafting, review and negotiation) is controlled by Legal, while post-execution tasks (obligation management) are usually handled by a contracts department or business unit.

For companies that have implemented a contract management system, the right document assembly system can provide huge advantages via integration. They are able to:

• Automatically push the execution version of an agreement into the contract management system in electronic form (even if the document has been heavily negotiated).
  

• Flag the extent to which clauses have been modified; which changes are simply approved fallback provisions, and which contain bespoke wording.
  

• Enable analysis and reporting on the risk profile of an organization's entire contract portfolio.

Conclusion
Currently, a few innovative legal departments are realizing the full potential of document assembly. For various reasons, most organizations have not yet analyzed contracting the same ways they have other business processes. However, when they do, they will discover that the contracting process is highly inefficient, and that the potential cost savings from automation are just too great to ignore.

Insurers improve productivity with KM

It’s one thing for us to say that we can help you improve your business. It’s entirely different for you to hear it from someone who has already succeeded in making their own business more profitable.

Les Doel, a manager at London-based Lloyd’s broker, Croton Stokes Wilson Ltd., recently spoke with KM World Magazine about his experience with document automation.

He said, "We wanted to be able to process more business with the same number of staff. The biggest challenge in becoming more productive was working with all of the different forms generated between Lloyd’s and various U.S. firms.”

After testing different products, Les chose Exari InsuranceAccelerator™.

You can read the full article here.

How to become an Automation Superhero

Here's Justin's latest post from CIO.com. You can read it here or check it out along with those from other thought leaders over at CIO.

Many business processes have been streamlined through automation but the production of documents and documentation often seems to be neglected.
We’re all aware of the benefits of automation. Our network monitoring, backups, integrity and heath checks, spam filtering, intrusion detection, software builds and unit tests are all largely automated. One area that often seems to be left out in the cold is the automation of documents and documentation.

The document assembly/automation space has come a long way in the last decade particularly with systems that are founded on XML and are architected openly, enabling integration with necessary upstream and downstream systems. Clearly I’m biased; it’s what we at Exari have committed ourselves to for that past 10 years. Imagine what a superhero you could become in your company if you were able to achieve the following:

Sales – a sales enquiry come in from your website. The lead wants more information. By filling in a simple, relevant online interview the prospect can potentially receive a customized business case or quote for your offering. It would be correctly branded, be up to date with the latest product information, pricing and discounts. An ROI analysis could be included based on the gathered information giving them even more compelling reasons to buy. Sample usage and support terms could also be delivered. Tell me that’s not going to excite your sales staff.

Software configuration and documentation – Your lead has been converted and you’ve made the sale. They’ve paid for your software offering and are ready to have it installed and configured. Your product has a myriad of modules, configuration and installation options. An online interview combined with the previous sales information can gather information about the specific environments, required options and configuration parameters. From this you can deliver customized installation, configuration files and operation guides and potentially even the configured software itself.

Legal – Do your product and service contracts still need to be approved by legal? Sure for unique, custom or ad hoc transactions legal needs to be deeply involved. But what about for standard deals – deals that are predictable and have a finite number of controlled variations? We all recognize that there are repeatable patterns around all common transactions. The business rules around these types of documents should be built into the document creation process . There should be a single source for such documents with up to date terms, pricing and conditions. Your business users should be able to generate these documents without legal intervention.

So next time you start thinking about how you’re going to make an impact by improving business processes don’t forget about automating your documents.

Where have you improved your business processes? Please let us know below in the comments.

Dow Jones and DLA Piper webinar recording now available for download

Do you work in a large company or law firm? If so, be sure to download the webinar recording on how Dow Jones and DLA Piper have benefited (in quite different ways) by automating the sales contracting process.

• Mitch Mackler, Assistant General Counsel at Dow Jones, gives a fascinating account of the results achieved by the salespeople and in-house lawyers at this iconic media company.
  
  
• Dave Jensen, Director of IT at DLA Piper, explains how technology innovation at one of the world's largest law firms won them a highly valuable global client.

Download the webinar recording now