BPO Thought Process

BPO Thought Process

Opinions expressed on this blog reflect the writer’s views and not the position of the Capgemini Group

Contract Management Tools – Only as Good as the Hands that Use Them

The market is currently flooded with Contract Management tools, many of which are excellent pieces of software that when used properly can accelerate the access to contract information and help an organization in its contract management challenges.   
The sophistication and thought put into these tools over the last 10 years is akin to the jump from a rotary phone to an iPhone.    However, many organizations are seeing that without proper process creation, training and management, these worthy investments are not generating the desired return.  Essentially, companies are paying a lot for smart phones, but only using them to make phone calls.  So how does an organization maximize its investment?
·         Thoughtful Process Implementation
Technology is not a panacea for all problems or a magic wand that will make broken processes more efficient.  Companies that are getting the most of their contract and compliance software are putting processes into place within their organizations to make sure that the data entering the system is sound, correct and traceable.  The term “garbage in/garbage out” is ancient by computing terms but still holds true today.  If an organization has a process which simply drives users to put contracts into a folder, then that organization will only have a lot of electronic folders.  
Without the metadata capture, contract sanitization or proper control points, no contract management tool can generate the insightful reports, dashboards or proper workflow tools to really create the intelligence, insight and efficiency that companies need when it comes to contract management.
·         Disciplined Follow-through
Once a process and tool are installed, they only stay relevant as long as enforced.  Even companies that get the first part right with implementation can quickly lose the benefit of the tools if there is organizational distraction.   Typically it is a properly assigned project to implement the tool and processes, but then the project management moves on to a new task and there are only the users left to enforce the process.  Unless the users or the company have it in their DNA to follow a new process and tool, there can often be back-sliding which results in shiny new iPhones, slowly turning into paperweights.
Successful companies will often assign full ownership or contract for support to enforce this discipline. 
·         Realistic Expectations on Retained Staff
Often times when companies realize they have a contract or commercial management issue, there is also a staffing or capacity issue.  Procurement, legal or contract teams are often overburdened with company directives on growth or acquiring new contracts.  They often have a bandwidth issue and trying to learn a new tool and process and then enforce it can be a real challenge. 
Successful companies will be realistic about their team capacity and either hire more or outsource for more assistance.
These reasons are why Capgemini counsel our clients on not just looking at contract management as a technology need, but a transformation need.  To be really successful in this space, a company needs to be realistic about what its retained staff can focus on and should focus on, while bringing in the right partners to take their purchased technology optimized for their environment and relevant in the long term.  No one wants to try to solve a contract management issue such as “overspend” or “revenue leakage” by throwing good money at a tool that is never used to its full potential.

About the author

Craig Conte
7 Comments Leave a comment
Excellent insight into an important topic!
Concisely summarizes an opportunity for businesses that while recognized as a benefit, has remained difficult to realize as mentioned in the article. In today’s competitive business environment the trend towards managing contracts effectively to improve the bottom line will become a key to not just survival but sustained growth.
Very helpful, Craig. Thank you.
Very helpful, Craig. Thank you.
Craig, excellent article!!! BR
Hi Craig. Wonderful article! Based on your recommendations of what Contract Management Software should have built-in, it sounds like you would be a big advocate of ConvergePoint. Please email me so we can discuss possible opportunities. You can visit our site and product information at http://www.convergepoint.com.
Thanks everyone for the comments. We are happy to help with the details of making any technology successful.

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