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Speed to contract: tips to keep pace in the transactional space

Karen Ngo

02 Jun 2017

Keeping pace with the business was very much a theme for the recent ACC Europe Conference. For the transactional lawyers present, there was a session devoted to speed to contract.

The panel led by David Gribble, a seasoned transactions specialist at BT, agreed that speed to contract is one of the more important things that lawyers can do in-house. Time is money. The quicker a contract is signed the quicker money goes into the business. Conversely, time kills deals; the longer negotiations take, the less likely a deal will close.

Unfortunately, it’s not unknown for lawyers to be accused of dictating the pace and content of negotiations and being the bottleneck in the transactional process.  And that’s obviously not the type of reputation any legal department wants.

However, contracts are multi-dimensional in their complexity, so lawyers do need to tread a very fine line between speed to contract and making sure that the contract signed is one that the business is able to honour and enforce.

Here are three top tips from the panel for transactional lawyers on how to keep pace with the business in the transactional space.

Work with the business

  • Get management attention and support to help legal lead the charge in building a transparent, efficient and robust contracting process.
  • Invest time in mapping out the entire contracting process for your business. Plan out each step of the process and understand who the stakeholders are.
  • Engage with the business and involve management to agree standard contracting principles to reflect the corporate risk appetite for different categories and values of transactions. For example, where churn contracts are just a vehicle for invoicing, evaluate whether it is possible to automate the entire process?
  • Develop appropriate governance structures and playbooks for managing the different categories of contracts.
  • Agree what key data should be captured through the life cycle of each contract to support metrics for management reporting.

Get your house in order

  • Simplify, standardise and centralise templates.
  • Minimise deviations by considering what is reasonable and market fair.
  • For bespoke negotiations, plan your attitude to risk and educate external counsel accordingly. Let them know if you need a Rolls Royce version of a contract or will a pick-up truck do.
  • External counsels are good at project management, get them to help plan out each project. 

Is tech the way forward?

In order for technology to be useful to in-house legal departments, the panel agreed that it must be:

  • Easy to use and to configure. As one panellist said, it must provide the same experience as shopping on Amazon on your couch on Sunday.
  • Intelligent enough to help.
  • Enterprise wide enabled. It must be able to deal with any contract anywhere in the world, at any time.
  • Capable of being tested in a safe environment.

There is a lot of legal tech in the market. There are a myriad of suppliers out there offering solutions from document management to matter management to Contract Lifecycle Management (CLM). It can be difficult for in-house counsel to be cognisant of what is available in the market, what capabilities each solution has to offer and whether integration is needed with existing business systems.

From our point of view as a legal tech provider, technology in the CLM space is probably the most evolved of all legal tech out there. Technologies involving the following are now commonplace:

  • Contract repositories that provide a business with a complete view of its portfolio of contracts, supported by dashboards and analytics.
  • Automated transactional workflow processes that follow governance protocols.
  • Contract generation by business colleagues with minimal involvement from legal.
  • Electronic signatures to support contract execution.

Many legal departments are using these technologies to their full potential. They are improving the efficiency of the business’ contracting process, the quality of its contracts and the promotion of best practice.

However, identifying the right technology, then finding the budget, resources and support to buy and implement a solution is not the most straightforward of processes. For inspiration on how to optimise your contract process, follow our blog series, Legal Engineering – How to optimise your contract process.  Part 1 has just been published.

AI-powered contract analysis Three reasons why generative AI will not take over lawyer jobs Generative AI for in-house counsel: What it is and what it can do for you Why CLM? Unlocking the power of contract lifecycle management for your legal team 8 strategies to help GCs manage growing workloads The legal department and the sales team: Making collaboration work Level up your legal team’s performance without increasing headcount The legal team and HR: A friendship built on communication How a rounded approach to people, processes, and technology helps GCs transform legal departments Beyond CLM: How to optimise contract management pre- and post-signature to add more business value