CLM Basics: 10 things to know.

By Mike Mitchell | May 22, 2018
About Mike
CLM Basics: 10 things to know.

Get started or get to the next level with your contract management.

When you are immersed in something day in and day out, you tend to forget that not everyone is as familiar with the topic as you are. At a gathering this weekend I met the CEO of a global financial organization that is growing and expanding rapidly with offices all over the world. The conversation got around to the inevitable, “So, what do you?” I mentioned cloud-based contract lifecycle management. “Sounds interesting,” said this CEO. What’s that?”

It was an important, if very surprising, reminder that even at the top of companies, the critical importance of CLM is not always known or understood. We find this a lot at the mid-market level, but it also happens in much bigger organizations. While it is not so much a question of awareness of CLM, the failure to embrace it is often about company culture, ingrained processes or misperceptions about cost and complexity. Making the shift is a process of education and pre-change management about the components of contract management, and stakeholders setting a clear approach to expectations.

10 important basics of taking CLM from buy-in to go-live.

More companies are deploying contract lifecycle management (CLM) solutions as a highly effective way of optimizing and streamlining business processes, mitigating risk of all kinds, establishing compliance, and achieving business results. It sounds like a magic pill laundry list, but the reality is that organizations that do their homework and lay out a detailed strategy for implementation do gain myriad benefits. Building blocks and a roadmap that have universal stakeholder support are how to deploy CLM successfully. But it takes planning; here are 10 critical aspects to consider.

CLM Basics #1: Include Key Stakeholders in Every Phase of the Selection Process

Getting all the right people in on the planning, selection and implementation of a CLM right up front is going to save a lot of heartache and setbacks. Contracts touch every area of a company, so that means bringing in different departments – e.g., procurement, finance, marketing, sales – beyond legal and the c-suite. This especially means IT, whose comfort level, guidance and interaction with the solution vendor are make-or-break. Everyone needs to know “what’s in it for them,” whether more collaboration, faster cycles, spend control, etc. This can have the added benefit of pooling budgets to cover your contract management solution. Prioritize your must-haves, and get everyone in on the demos.

CLM Basics #2: Get Hands-On with a Sandbox

A sandbox or staging environment can be a powerful proof-of-concept and proof-of-value tool. It’s allows you to demonstrate not just usability and generate enthusiasm, but instill confidence across stakeholders. Beyond the “hey, this really works” factor, the sandbox can also be a reality check on your process preparation for implementation – a useful look at “did we clean up our templates or over complicate our approval process?” Remember, solution success means full adoption, so it’s never a bad thing to let people become familiar.

CLM Basics #3: Start With Your Pain Points

Before you pick up a tool, you have to know what you’re trying to fix. In the case of a CLM, that means proactively getting every group involved that will touch a contract and walk through (and work through) the process. What works, what needs improvement. Data fields, libraries, templates, approval paths, alerts and more should all be reviewed – they’re unique to your organization, so be thorough. Working with the implementation team to define what you need establishes process efficiency from the beginning.

CLM Basics #4: Keep Approval Paths Simple

Convoluted in, convoluted out. How many people really need to touch that contract, and when? Who’s actively in the process, and who just needs awareness? How far do contract issues need to escalate? A CLM can provide an awesome level of power and granularity, but it’s not about the bells and whistles as much as it is efficiency and user experience. You don’t have to push every button to unlock the full potential.

CLM Basics #5: Don’t Wait to Scrub and Standardize Contract Templates

If you’ve never had a contract management solution, you may find a distinct lack of consistency across all your contracts. The “that’s how we’ve always done it” approach is pervasive in many if not most companies. Do a review – document errors, omissions areas that always need correcting. What type of data will need to be included for metadata fields and reporting? Collaboration and cross-departmental input are critical to ensuring that your CLM system will have all the right contract fields for all users.

CLM Basics #6: Get a Grip on Your Legacy Contracts

Like most organizations, your contracts are likely in every format – PDF, Word, emails, paper – and every location. Risk grows in those silos, unseen. To manage contracts you need to have complete visibility of them – ALL of them. As part of a CLM implementation, legacy contract discovery gets your contracts centralized, accessible and usable. This is not an afterthought part of the process, but a vital step that will have immediate impact – on risk, relationships and the bottom line.

CLM Basics #7: Phase-In Your Implementation

Once you get a taste of what a CLM can do – especially if you have a sandbox stage – it’s tempting to go full speed ahead and do a big-bang launch. Don’t. A phased approach that rolls out in doable pieces across contract types, departments and geographies gets users comfortable and builds stakeholder confidence. Feedback let’s you fine tune the process and fill any gaps. Learn, adjust, move on. The result is higher, faster adoption rates, smoother rollout and demonstrable success that leads to quicker ROI.

CLM Basics #8: Put a Go-Live Stake in the Ground

Pick a go-live date, stick to it. Communicate it ad nauseum. People need to know the hard-stop timing so that there is consensus on what they need to do to make it happen. Setting a CLM solution go-live date often needs to be ambitious without being completely unrealistic. Your contract management solution vendor should set expectations of how long implementation will take, which will allow you to work backwards. This is especially true – and useful – for your phased approach. Waffling on the go-live date will undermine the confidence and excitement that’s already been built.

CLM Basics #9: What’s Your Problem, Really?

What do you want a contract lifecycle management solution to solve for? This is not a trick question. Many companies find they are trying to fix a symptom instead of solving real problems. This goes back to collaboration and goal setting, and enables you to build a solid business case. More importantly, it provides a baseline for measurability later: Can we now do what we couldn’t do (or do well) before?

CLM Basics #10: There’s No Such Thing as Over-Communicating

Talk isn’t cheap; in fact, it’s invaluable. So are emails, texts, documentation, etc., etc. Implementing and managing a CLM is a big deal and a big step for many organizations, so the more communication you have the more everyone is kept on the same page. This is true internally, and with your implementation team and project manager. Keeping everyone involved, speaking up, asking questions, asking more questions is how to build success at every phase. And keep that conversation going: go-live isn’t the end of the process, but the beginning.

If this list of CLM basics has you thinking about implementing a solution, or rethinking your existing one, take the next step. There are a lot of resources on the Corcentric site, but the clearest way to see how Corcentric Contract Lifecycle Management can help you reach your business goal is to schedule a personalized demonstration of the Corcentric Platform.

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