Live In Vegas: How to Speed Up and Scale Up Procurement with Agile Contracting

Made with speech-to-text software, so a few words may be off.

0:00You're listening to the Contract Heroes Podcast, your one-stop shop for all things contract management. And now here are your hosts, Marc and Pepe. Great to have everybody here. You know, it's a little, little different than what we're usually doing. Not used to having an audience, but really excited to, to talk to everybody and, uh, can't wait to get into this conversation. So Prashant, maybe you can kick us off by just giving us a little bit more info on your background and, you know, what we're gonna be... Oh, actually, Pepe, why don't, why don't you talk about what we're gonna be discussing today? Well, today we're going to be discussing, uh, about procurement and how to build a better relationship with legal. This is very cool because we had Prashant on the show, like, couple months ago. We were more into the features of the CLM, but this time we want to go more into the relationship and internal processes. So very happy to be with you again, Prashant. Well, thank you, uh, Pepe, and thank you, Marc. And, uh, by the way, happy birthday. Thank you. So thanks, all, for coming to Pepe's birthday party.

0:57Appreciate that very much. Thank you. And I call these guys the, uh, what I call OG of CLM implementation and podcast because these guys have been proliferating knowledge from the industry for quite a while, and they're taking their show from the basement out to carbon-based three-dimensional form. So we'll see how this goes today. But, uh, my name is Prashant Dubey. I'm the chief strategy officer of Agiloft. I joined seven weeks ago, so my disclaimer is anything that I say is probably based in conjecture, so please don't go check the fact base because I'm just probably making it up at this point. But no, thank you very much for joining today. Really excited about it, and we'd love this to be interactive because part of my remit is to take the collective wisdom of the community, which is all of us, and find vehicles through Agiloft to share it back to the community in ways that can be actionable. So I truly, sincerely would love some interaction. We all would. Otherwise, you'll listen to us talking at you for 40 minutes, which won't be as interesting as you talking with us. So thank you again. Awesome.

1:57So Prashant, uh, like I was saying, um, there's a lot of interest, of course, in the CLM between there's a lot of initiative that are lead by pr- pr- procurement. And we d- discussed last time about some of the features that these departments are looking to. But, uh, in your experience, like, how's this relationship, like, you know, like, from one side, procurement wants to have something, like, faster. They want to start working with their vendors. But on the other side, like legal, they're more into risk adverse and they wanna review all, all the documents. So what would you say is, like, the best way to start building the, the best relationship they can? It's a great question because if we sort of think about the genesis of this industry, which is still actually forming, right? The definition of contract management as an industry in terms of who owns it within an organization, that's evolving. What does it actually mean? What are the steps involved is actually evolving as well. And a lot of contract management has been focused on indirect procurement and the buy side. The sell side has also been a focus, but historically we've noticed that it's actually born from the buy side.

3:03And we've seen a trend recently over the past three or four years where procurement organizations are taking a d- a deliberate stance where they wanna control more of the contracting business process themselves, uh, from a almost self-preservation point of view, and it's extending into budget being allocated for procurement organizations to directly procure contract lifecycle management software, which is a different dynamic because legal organizations were typically doing it in the past. And there was, you know, some question about is legal the right organization to do it? I mean, jury's out on that, right? That was a legal pun. Didn't mean it to be. You know, I think procurement definitely has a point of view there, and the relationship between procurement and legal sometimes has bordered on adversarial because business drivers for procurement organizations are not just how do I get the best price and consolidate vendors, but it's really about managing categories from a strategic perspective. So the remit is changing. They're being viewed more as strategic enablers of the business.

4:03And so in that particular remit, if you view the legal organization as a business prevention department, which sometimes can happen, the foundation for a successful relationship isn't there, so efficient contracting with proper risk management, proper controls in place isn't something that manifests in, in an organization. So we've seen procurement take control of it, not in a command and control way, but I would probably say more in a collaborate and control way, which is a really refreshing point of view. So this is a very positive... We're gonna focus on positivity today, right? Procurement is really doing this in a very positive way and we wanna share some of our observations as procurement organizations have done this back with you and get your feedback on it and, and see if we can have a discussion. So we also talk about five key strategies on how to go for, into this objective. One of the first ones was about, uh, working together on a playbook.

5:02Like, there's a lot of people calling about the playbook, but actually, like, how it looks like. What, what would be the best way to start building this document? When Pepe talks about a playbook, uh, you know, we've talked about this a lot in the past, specifically talking about negotiation playbooks and, you know, one sort of caveat to all these comments is nothing you'll hear today is gonna be a huge aha moment or some earth-shattering thing that you've never heard before. What we're sharing with you are things that we've observed that are pragmatic, that actually make a difference when procurement is proactive about putting these initiatives in place along with legal. So when you think about a negotiation playbook, procurement wants some autonomy in being able to negotiate agreements, but at the same time they want air cover. They wanna make sure they're not taking undue risk on behalf of the company, so they'll engage the legal organization to do a legal review. But sometimes there's an anachronistic approach where all the commercial terms are decided and then they throw it over the wall to legal and say, "Do a legal review."

6:01Well, it's really difficult for a lawyer to look at that because how do you balance commercial terms and legal terms? You no longer have that leverage in terms of negotiating with a particular vendor, especially if it's a critical relationship. So- One way to actually alleviate some of that tension is for pro-procurement to proactively work with le-legal and say, "Let's put a negotiation playbook in place that recognizes the fact that we may have some autonomy in negotiating some provisions that are always negotiated. These seven provisions are always negotiated based on our experience. And by the way, let's put in, uh, some parameters where we have autonomy to go beyond the language in the template. And we can pick one, two, or three fallback provisions with different, uh, sort of risk profiles associated with them. If we go beyond those, we pull the rip cord and we engage legal support." And collaboratively building that negotiation playbook with legal allows a productive conversation to occur, but as a practical matter, what that does is it gives the procurement organization the autonomy to bring contracts maybe from 45% complete to 75% complete, which allows you to accelerate your cycle time, allows you to make more efficient use of legal resources, and gives procurement more empowerment in the overall process.

7:20So again, this sounds straightforward. It's not an easy exercise to accomplish because it, it requires some consensus, and lawyers are ones that many of them feel like they're artisans or craftspeople, right? So their language that they put in a contract is, is bespoke. Like, nobody can write it in, with the beauty that they can. So getting through that sort of emotional hurdle and having a high EQ is really important for procurement organizations. But we've seen it, when it works well, being a very productive exercise to build a relationship. Yeah, and I, I think, you know, d- no matter where you are in your contract management journey, you can put these playbooks into place, right? If you have a CLM, if you don't have a CLM, y- you're, you're able to, to put these playbooks into place so that you can leverage them and, and still speed everything up. And, you know, I think it's interesting to, to mention before we move on is, you know, building these playbooks, h-how do you see those working if somebody has implemented a CLM, right? So they, they're using a CLM.

8:18What does that leverage look like, uh, i-if, if you're able to use both at the same time? If you're about to implement a CLM and you have the time and budget luxury to do it, it's a great readiness exercise because it makes your CLM implementation all that much more efficient because you know from a configuration standpoint, you have a lot more information that's empirically derived from people that are gonna be using the system, right? Organizations oftentimes don't have that luxury, so they have to build a plane mid-flight. So if you have a CLM system in place, doesn't prohibit you from having this discussion. As a matter of fact, most CLM systems of basic functionality will have the ability to have a playbook in place with a clause library, fallback provisions that you can select, way to tag those particular provisions with different levels of risk or desirability from a company's perspective. So the basic functionality does exist, and it's just a matter of putting it in the workflow and implementing it in a way that recognizes that human behavior is going to change.

9:17It's not gonna happen with, you know, Word and email any longer. Those negotiations will take place maybe using the construct of the CLM software itself. There's probably Word integration or things like that in there, so you'll be used to the same UI. But there's nothing that prohibits an organization from doing it if they don't have a CLM, and n- nothing that privi- prohibits them from doing it if they've already implemented one. Right. And going to the second s-strategy, key strategy, uh, we're talking also about, uh, template standardization and how to, uh, also standardize intake protocols. Like, you tell us a, a little bit more about that. Sure. Sure. Uh, let's talk about intake first. That's actually an interesting thing. It sounds really tactical, but sort of intake is big intake and little intake. I look at it that way. The initial intake is when a procurement organization receives a request from the business to actually transact with a third party.

10:10They need to intake the business requirements in order to figure out what's the right template to use for this particular transaction, right? It's very difficult sometimes to select the right template. And in many organizations, I know some of my colleagues in this room that are thought leaders may disagree with the disproportionate impact lawyers have in, uh, influencing the decision about what template should be used. In fact, it's a business decision with the other side. It's not a legal decision. There's some legal terms in it, right? But lawyers do have a disproportionate impact. Okay, so let's accept the fact that that's the reality for now, right? And so if you have lawyers involved as a procurement organization in the process of creating the intake protocol that you get from the business to select the right template, the probability of, one, selecting the right template, and two, the probability that the legal organization won't say, "By the time it gets to me, you've selected the wrong template, so I'm gonna rewrite this thing or I'm gonna just replace it with something," it happens much too often. It creates inefficiency and tension in the process. So get legal involved ahead of time to have a point of view. Now, intake itself is a kind of an elusive art, right?

11:22How do you make sure you don't pepper the requester with so many questions you bring them to their knees and they say, "This is a really bad user experience"? But how do you get enough information to be able to select the right template? Or mechanically, there's dynamic template creation. Right. Sometimes intake can drive the dynamic creation of a template using clauses that are alternate provisions that you can use having a base template and then using alternate provisions based on the intake requirements to create something that's purpose-built for the transaction, right? If you involve legal up front, the probability that it'll be changed down the line is much lower. So that's sort of what I'd call big I. The little i is you've negotiated some of the commercial terms, you've gathered some basic information about it, but then you need to get legal support. Imagine an intake process that you work on collaboratively with legal where legal says Give me this information to make it easier for me to triage your request.

12:21For example, does this, uh, contain any intellectual property provisions that I need to focus on that are out of the ordinary? Are we exchanging any data with this organization where I need to think about data privacy and data security issues, for example? Are there any cross-border issues associated with this? Are there fourth parties associated with this? Are there flow-down or flow-through terms? These are all things that legal cares about, that procurement can gather information on, and actually put into an intake form where procurement requests legal support. Now, that could be turned into a process where it could automatically be triggering a different swim lane of legal review. This is a low complexity review, medium complexity, or high complexity review. So I don't know how many... By the way, show of hands, how many of you are part of a legal organization? Okay. And procurement? Okay, so majority procurement.

13:16So, uh, I'm sure you interact with legal all the time, but, I mean, the way that, you know, lawyers' work queues are much longer than they can probably deal with in any given day, right? I mean, it's a reality for a lot of us, but lawyers are trying to deal with their work queue. One of the best ways for them to deal with their work queue is to figure out how to triage the request. Sometimes they triage it by saying, "I'll work on the thing where the executive's screaming the loudest." The reality, right? That's my first priority. But hopefully, if that's not always the case, they can say, "If this is low complexity, I can assign it to a junior lawyer. There's an experienced paralegal that can actually do this. There's a contract manager that can review this. It doesn't have to be a lawyer, uh, who can focus on strategic risk management things versus focusing on things that are more routine." So that information, uh, if gathered by procurement, demonstrates a degree of respect for the legal organization in terms of how much, uh, they have on their work, uh, work queue, right?

14:15And so that also reduces the tension between the two organizations. Right, and I think it's interesting that y- like you said, right, I mean, there's a lot to focus on during the day from a legal perspective, right? And by putting these processes in place, you're able to take some of the workload off of legal, empower procurement to, to handle this themselves. Yeah. And a lot of the times, even global or- organization, they have a very small legal team. Like one of the speakers that was talking about some of the case study, there's a global, uh, corporation, and they only have, like eight lawyers. Mm. So this kind of strategy is going to reduce their workload and help, uh, procurement to become like a self-service contracting department for s- specific threshold, right? Mm-hmm. Yeah, a- and the other benefit of this is that as you start gathering this information, and you can envision your contract transactions on sort of a matrix of risk and complexity, you have the opportunity to consider things like alternate models to review contracts. The legal organization could say, "If I can bucket these contracts in terms of a low business risk or medium business risk and low complexity, I may be able to consider a legal service provider- Mm...

15:23at a lower cost, maybe offshore, to review some of this within the constructs of a playbook, because I have more empirical information in order to do this. Or maybe I can automate some of this, right? And I can have some automated review where there can be an initial first-pass review using technology, and then I could do sort of a confirmatory review after that. Um, so you have the opportunity to do a lot more things in terms of creating efficiency in the process as well, if you're able to gather this information. Right. And sorry if I mix, mixing some of the key strategies here, but I think, uh, talking about the playbook of negotiation, then, uh, the intake forms, and then the standardization of templates, like you gotta bring th- these stakeholders together. Mm-hmm. Right? Because I, uh, something that you said is that sometimes, well, not sometimes, a lot of the times, like the language of the contract is like very legally technical. Mm-hmm. And a lot of the people from the commercial side, they don't understand it. Mm.

16:18So it's, so it's very, uh, important to build together this, uh, the, the language of their, of their template, so when they're facing any kind of negotiation or backlash from the, from the vendors, right? So they, they understand what they're, what they're talking about, right? So, like how would you recommend an organization to be improving these templates and the language, and always bring legal and, uh, and procurement? Yeah. And actually, that's a natural extension of, uh, creating a playbook, because... And, and there's also another element of it, which we can talk about in a second. Actually, let's talk about it real quick right now, because it's almost a precursor to this. Um, another, uh, strategy which we haven't discussed yet, but is sort of foundational, is procurement can maintain a robust repository of executed agreements. Sounds very tactical, but once the g- uh, agreement is fully executed, should it live in the legal organization, or if it's a buy-side agreement, it could live in, it could live in the CLM system that is owned by procurement.

17:21So procurement, at the end of the contract being executed, can ensure that all of the contracts are organized in a parent-child relationship. They're named in a rational way with a common naming convention so you can find them. There's metadata extracted, so you can not just search and retrieve, but track obligations. Having this available for lawyers at the time that a lawyer has negotiated an agreement with the counterparty puts lawyers into a, uh, into a, a proper negotiating position. If they don't have access to it, they're in a substandard position, right? If they don't know the precedent agreements that have been set with the counterparty, if you've contracted them, uh, with them in the past, but the vendor knows it, you as a lawyer feel like you're not in a good negotiating position. So having availability of those contracts at your fingertips is, is really helpful. Now, if you also have that information, you can use it for template standardization. So empirically, you can go in and say, "If this is my starting point..." And by the way, our, our, what we've seen work very productively- Is when procurement is proactive about this, that's a lot of Ps.

18:28Good alliteration there, I guess. Prashant with procurement. There you go. Off on a tangent. See, I told you I have to be controlled. But if they're proactive, if procurement's proactive about this and says, "We have a lot of empirical information. We've negotiated these contracts now for a number of months, a few quarters. Let's take our starting point template. Let's take 15 examples of the ending point, and let's figure out through some deviation analysis which provisions in the ending point contract deviate from the starting point the most." And you can sort of rank order them by, you know, the degree of deviation. You'll probably find that for a lot of the contracts, that seven to 10 provisions are the ones that are negotiated every single time over and over, and you end up at the same language at the end. So if you do, why not take a few select, uh, provisions from there and work it back in the starting point template and say, "We don't have to negotiate this in the first place," and negotiation intensity goes down.

19:30Now, if procurement is proactive about that, a few things happen. Number one, they reduce the need for legal review on some of those provisions. They accelerate cycle time because the other side will say, "Oh, you've already got language that I'm willing to accept, so I don't have to mark it up," so the red line intensity goes down. So there's a lot of goodness that comes from that process, but procurement needs to be proactive about doing that and bringing legal into it and saying, "Let's change the template that we're using as a starting point. Let's define that differently." And we found that to be an extremely productive exercise. In your experience, is that the best way to start going about these processes if you're, if you're looking to kind of implement these, these strategies? Is that where you would start, or is there maybe another place that you would consider to, to kick things off at? Well, you know, I, I mean, there's a few preconditions to this. We've talked a lot, I think, at this, uh, summit about using data, and I don't think it'll surprise any of us that a lot of organizations are still struggling with creating a single source of truth repository of executed agreements with metadata extracted.

20:34So I don't wanna be cavalier about it and say, "Since you have this, let's lever..." I mean, it's a struggle to get there, right? First you have to find all the agreements that exist in the organization. There's legacy contracts. There's contracts that sit in share files here and there. You've done an acquisition. You've tried to bring those contracts in. You haven't reconciled it with your other agreements. This is still sort of what's called CLM maturity level zero, but- Right... honestly, I, I don't view it that way. I actually feel that, you know, it takes a pretty high degree of maturity as an organization to have a robust single source of truth repository that's high integrity that people rely on. So if some of you are sitting there going, "I don't have that," take solace in the fact that your next-door neighbor probably doesn't either, right? There's a lot of larger organizations that don't. So if you have that, and you have a decent amount of confidence in it, you can leverage it for things like this. So a starting point, my personal point of view is focus on the repository.

21:32Start with contract management from the back to the front. If you can foc- I mean, what happens in contracting, right? You spend three weeks to three months negotiating a co- complex contract. You breathe a sigh of relief. You call it something that makes sense, which is, you know, Pepe's contract with, you know, Prashant, you know, January 26th, 2023, and you s- I mean, nobody knows what that contract's about, right? You don't name it the right way, so you breathe a sigh of relief, and then you don't think about it afterwards. That happens in company after company after company. So if we, if organizations have that discipline, and procurement can drive that discipline to create that repository, not only are you able to manage obligations, search and retrieve contracts, enable lawyers to have access to the agreements when they're negotiating them, but also drive empirically template standardization, do deviation analysis. So it's not complex from an analytic and intellectual standpoint. It's complex to do from a relationship standpoint and a bandwidth standpoint, right?

22:36People are running on the treadmill so fast they don't have time to step off and tie their shoes, and our general counsel, Laura, said it very well when I said this to her. She goes, "Well, maybe they should just have shoes with no shoelaces." I'm like, "That's pretty smart, actually." But you know, I mean, it's hard to make that leap, uh, sometimes. So yeah, that's... That... A great way to start is the repository. Uh, and then putting a playbook in place is probably a great way to start because there's no precondition that you have to have a contract lifecycle management software application to have a negotiation playbook. I mean, a negotiation pl- uh, it could be as simple as a Word document with annotations. You start somewhere, right? Or an Excel spreadsheet, right? You don't have to over tech- technology this thing out of the gate, and just document for this provision, you know, what are all of the, uh, different alternatives that we've seen, uh, in the past, and look and write those down. And just look at them and go, "Huh, which ones have a theme? Which ones repeat over and over?"

23:37And then when you have that information, if you automate with contract lifecycle management software, you have the information to actually have a headstart. Right. I mean, if, when an organization wanna take a step forward to starting to implement a CLM, like, having all this information, this phase zero part, uh, very well mapped and documented, it will make the implementer's life easier and also the people that is involved into the implementation. Because a lot of the time they start, they, they wanna do an implementation, but they don't have this clear, right, and defined. So when they, when, when you kick off the i- implementation, maybe they don't have the standard template and they wanna work it- Correct... during the implementation process, right? And when, when you have the Correct intake form, it's easier for the implementer to think about some of the automations that you can do there. Like if some of these conditions are met, then you're gonna use this clause, right? And maybe this, th- this contract will represent a higher risk, so maybe we gotta e- I don't know, insert like a different provision.

24:41Maybe these documents because their, their, their, their value is, I don't know, like over a million dollars. These ones, they, they gotta go to, uh, to the lawyers for the legal re- re- review. So this is very important. So when the companies are looking to implement a CLM provi- uh, solution, having this information in place before starting the implementation is gonna make it, uh, way more successful to have the CLM project in the organization. Yeah, and, and I kind of view that more as a statement coming from Pepe versus a question to me because, uh, like I said, these guys are the OGs of implementation. I think you've done, you know, 150 Agiloft implementations if not more. So, I mean, you understand and how often do you have the luxury of having this information available to you? Yeah. But you have to go through a long discovery exercise and interview people, and it's an abstract exercise- Right...

25:33versus actually being in the moment and understanding the workflow from a concrete perspective and having artifacts that document that. If you had that, then your implementation is smoother, it goes faster, and there's less tumult, and change management obviously is a big challenge. But if people are used to these collaborative discussions, the implementation process of contract management software becomes a little bit easier. Yeah, and, and I think, I mean, at the beginning of all of our implementations, we try to, to talk about this with our, our customers to make sure that they understand what they're actually getting into. And I'm sure a lot of the folks here have implemented Agiloft and they actually understand it, and that beginning phase can be overwhelming. A- and I think that if you are able to build out those processes to begin with before you go into the implementation, like you said, it's gonna go so much faster than, than if it's something that we're just starting to have conversations about at the beginning of, you know, of the configuration work. You know, I, I mean, I think the point you raise is a very good one, which is a lot of people in this room have implemented Agiloft already or are in the process of considering it.

26:37So maybe a show of hands, how many of you in the procurement organization have actually, uh, proactively gone in and acquired CLM software yourself and had this kind of conversation with legal? Okay. So, so a good number. So, I mean, how's it gone? I, I... How'd that conversation go? I mean, can I pick on you and ask you that? Sure. So in my organization... Oh. I could not see it in the back. So in my organization, legal pays the bills, but I run the system. So procurement runs the system. Uh-huh. So we were involved from initial sourcing all the way to selection. Then im- we implemented it, so you know, it was, it was largely procurement resources that implemented it, and then now we run it. And, but I, I am very blessed with an amazing legal organization that are procurement forward. So they're educators. They want me to know, "Hey, these are the things that, that I'm going to warn you about, so know them ahead of time." And we've been able to do the same to say, "All right.

27:35Well, our business owners are woefully undereducated on what makes a good deliverable in an SOW, right? And so I'm gonna need to work with them on that so that you get it in a better finished format." So yeah, that's one of the things I'll talk about here in a little bit, but the, the, the marriage between purchasing and legal through the CLM, the, the, the CLM helps create a really nice bridge for that. Uh, what's your name? Matt. Matt. So, uh, if anyone's jealous of Matt because he has the luxury of a great relationship with legal, let's, uh, talk about somebody that may not have as good of a relationship. Uh, in back there. Awesome r- another one with an awesome relationship. Okay. I'm with The Hershey Company, and the project was co-sponsored by the CPO and the general counsel. And then, um, I co-own it. I'm the director of indirect procurement, along with a counterpart in legal. Mm-hmm. So everything the entire way, start to finish, was co-owned. Luckily, legal pays for it though.

28:37So overall, it's been really good, but that relationship has been in place for a really long, long time. Mm-hmm. And we did a ton of the stuff that you talked about as pre-work for anywhere from two to four years before we even bought a system on. That worked really, really well. And what is your name? I'm sorry. Sherry. Sherry. So I, I mean, uh, Sherry, I think you, the heavy lifting that you guys did beforehand created the foundation for a productive relationship. So I think you're sort of validating. I mean, it may not take two years, but in large organizations, which yours is, there's sort of an organizational speed limit, right? And to be able to respect and understand that is important in implementing CLM. So I guess as a software company, I sh- I shouldn't say, you know, slow down to speed up, but I am saying that, right? Mm-hmm. Slow down a little bit and maybe think about some readiness aspects, uh, that can help the implementation, and then make the decision to actually start the implementation, right? Yeah. So- I mean, that's what we talk about all the time, right?

29:39And, and I don't think, uh, some folks are, are so focused on the software and they wanna get it implemented and they want it to work. But, um, i- if you do slow down and you do these processes upfront, I, I think it makes the, the implementation go so much easier. And, and you're gonna get better user adoption too because you're actually gonna put processes in place that people understand and want to use. Yeah, and also like cost efficient because if in the middle of the implementation you see that the processes works better in a different way, there's gonna be a lot of change orders there. Yeah. And you gotta to reconfigure a lot of the things that you've been working on the previous months. So that slowing down I think is like one of the best recommendations. I mean, that's a great point. I mean, we've all heard horror stories about, you know, CLM implementation nightmares, and sometimes it's about software functionality, oftentimes it's not Oftentimes it's, you know, people don't necessarily have a high EQ when it comes to this, and they don't realize that you're actually changing human behavior. And, you know, I mean, if you think about it from a lawyer's point of view, uh, even though their work queue is really long, they've figured out how to do it so they can go home to their families at night, right?

30:44Even if you make a change and say, "This is gonna be beautiful. It's gonna be a great UI," it still represents a change from what they're used to. So if there's a degree of preparation that involves these kind of collaborative discussions, it creates a good foundation for trust between the organizations, which sounds like you definitely have in your organization, and you do at Hershey as well. Um, any other stories, good or bad, that people would like to share? Yes. So- Oh, please. I'm actually the opposite of... Sorry, I forgot your name up there. But we, we went through the process of actually, uh, moving towards Agiloft, and during that process, we, we actually, 'cause I'm in sourcing, we, we handed the responsibility of the CLM over to legal, which personally I'm very happy about 'cause that's less on my plate. But all that being said, I guess a, a question I have for you guys is, is, is even though we've handed that over to legal, my team in particular has been very engaged with giving them feedback and supporting them with the implementation.

31:44But one of the concerns we have is, especially with some of the newer folks on our team, you know, we, we were gonna take the opportunity to kind of train them up again, let's say, on some of the terms and things of that nature. But we quickly realized that a lot of our newer folks really struggle with some of the terminology, right? Not the scope of works and things of that nature, but literally the, the legal terms, like the warranties and things of that nature. Mm-hmm. I mean, I had one person tell me when they read that, even though it's in English, it's a completely different language to them, right? So I guess my question to you guys is, do you have any ideas around how to effectively train some of our newer folks that aren't as skilled with some of those things so that we can help our, uh, legal department when they do request some of those changes? Uh, well, do you guys wanna take that, and then I could chime in afterward? Sure. I mean, I, I think it's important, obviously, I mean, Agiloft has a, a great training program, right?

32:39They've, they've rolled out the university, and I think it's important that if people are gonna be leveraging the, the system, they need to take the training, right? But, but on top of that, I think it's important to have a partner, and I, you know, don't wanna talk about Koho here, but having a partner like us to be able to go in there and offer managed services, right? To, to kind of be that admin and, and train those new folks when they're coming in from a perspective of not it being generalized, you know, with, with a, uh, from a system perspective, but actually understanding your implementation, what you're working with, and, uh, be able to train those folks to more easily, uh, be able to go in there and actually use the system in the way that it's meant to be used. And, and I think you need somebody that has done the implementation, understands the system, uh, to be able to, to leverage somebody like that, um, to, to bring new folks on board. And also, at the same time, you know, if, if you wanna make configuration changes in the application after you go live- Yeah... because you're, you're actively learning, right?

33:33As, as you're going through these processes, you're gonna continue to evolve. You're gonna wanna implement new, new processes, and y- you need somebody to do that, unless you really wanna have an admin that's, you know, fully involved in, in the application. But like we always talk about, it's, this is not your only job, right? Unless you're bringing somebody on to actually be the system admin, uh, it, it, most of the time it's a lot easier to have another company do that, that has experience with it, uh, it, to pass that knowledge down and, and manage it. Yeah, and I would say that an- another thing would be that you have to involve the, all the, the users that are going to be involved in this process pr- pre-implementations and during the implementations because you got to get them excited about this new software. Mm-hmm. Because a lot of the times they just tell them when it's already go live, and now they have to get trained, and they have to spend some times doing this software. While if you s- get them excited, what I, what I mean with this is just like, uh, I got a friend, uh, Chris, um, uh, he says that it's just like when there's a new picture, right?

34:37You just gotta, gotta, gotta do a like roadshow, tell everybody what this new software is gonna be about so they know the benefits, and they know that if they take this training, they start using this system, they're going to work faster. They're going to reduce their costs. So that would be like a way on how you can handle it. I, I'm sorry, what, what was your name? Alex. Alex, and what industry are you in? Subcontracting company. We're manufacturing in a couple of different sectors. Okay. So I mean, you know, your, your question has multiple-- It's a straightforward question with probably a complex, multilayered answer. I mean, definitely what Marc and Pepe are talking about are related to getting familiar with the system and the functionality of it. If you're also talking about the terms and terminology in the agreement itself, right? Unless you have really arcane language related to industry-specific terms of art, that could be a call-out to have your contracts written in more plain English, right?

35:38That's hard to say to a lawyer who, again, perceives themselves as an artisan or a craftsperson. But that could be a call to say, if it's not self-evident to an experienced sourcing professional what this provision says, and, you know, they have to really read it to try to understand it and they still don't, that could be a call for that. But that also is an opportunity to create this negotiation playbook because that collaborative discussion can allow you to discuss certain provisions that sourcing is looking at all the time and for lawyers to say, "Let me tell you what this actually means, and let me give you a few fallback provisions and explain it to you." So that, again, is an opportunity for collaboration. So I, I, I... We don't wanna turn sourcing professionals into lawyers. There are legitimate reasons for lawyers to review contracts. But the point you raise Could create an opportunity for doing some things like actually simplifying the language in the template. So we have kind of an interesting situation. I work for a gas station convenience store chain. Mm-hmm.

36:39Our parent company owns an oil refinery, bank, a bunch of different companies. We had a repository system that was dying. It was horrible, so we needed to do something. We all leveraged together to buy a CLM system. Procurement pushed it from our side, legal pushed it from our parent company, and general counsel said, "One size fits all," and we were all with his sweat. Our reputation did not go well. Mm. Um, didn't work for anybody that used the system. He left. Now we're kind of re-implementing the system. Our problem is we, we have a very big organization, a lot of instances. We have one general counsel, one lawyer. He has to touch everything that goes through. Wow. He's very slow. He won't use the system- ...no matter how much we beg. So we've worked out a system to where if it's not one of the, I call it the whole trinity, if it's not indemnification, limitation of liability or insurance, we don't talk to him about it. If, or data privacy. Mm-hmm.

37:39If it's not one of those, we're allowed to do what we, what we want with it. We all have enough experience negotiating contracts that we don't have people to handle that type of stuff. If it's business terms, it's between us and the business partners. Legal doesn't have to be involved. Right. Uh, what, what's your name? Mike. Mike. So, uh, Mike and Matt may be on two ends of the, uh, continuum there when it comes to it. I mean, you're describing a situation that isn't all that uncommon. Uh, I would probably say there's some extreme elements to it with the degree of control your general counsel is exercising over the process that's not typical in terms of what we see these days. But you figure out a way to self-determine, I guess, where you've said, "Okay, we're comfortable with this and we have enough experience to do it." At some point, though, and I'm probably insulting somebody here, uh, by saying this, but at some point, general counsel that have that point of view won't survive because it's, it's arcane.

38:35It's an archaic point of view because you have to enable and empower. You can't manage by fiat anymore. Which organization runs that way? So boy, I'm being really critical and that's probably the wrong thing to do. But I mean, honestly, the situation you're describing from your perspective is not desirable, right? I mean, you don't think it enables commerce. As a result, you're exercising control, but you feel like you're doing it within parameters where you can protect the company. Wouldn't it be a lot better to sit down at the table with legal and say, "Let's do this together"? Maybe we'll talk about it offline, about strategies to do that. But yeah, you're, you definitely are in a situation where you have to self-determine, but it sounds like a big challenge. So I work in a coordinated care organization where we, um, manage Medicare and Medicaid, and it has, um, a robust legal department, a few attorneys and couple paralegals. They had a contract management system called, um, ConvergePoint. Mm-hmm. But they didn't use it properly, and every time they hired a new contract administrator that managed the system, they would go in and change it.

39:43And so it's, it's broken. It's beyond broken. But legal owned it, and other departments didn't like using it, and so they would email, um, contract requests to the contract administrator to put in, and then how, whoever was doing it or how they felt is how they put it in. So even the repository part of it is broken- Mm...beyond repair. The organization didn't have a procurement department until almost two years ago, and we came in with templates and processes and a policy and, um, it took a really long time to get legal to kind of buy into that because at first they were going like, "No, this is what we do." Mm-hmm. But they were doing it very poor. That's why the C-suite hired us. So we did get people on board. We limped along ConvergePoint where we actually put in request forms and stuff like that, but legal still owned it. So when we went out for an RFP to get the Agiloft, they don't want anything to do with it.

40:52They didn't know decision-makers or anything. But we did finally get, about six months ago, we got one attorney that we work with for any kind of unusual request in contract legal terms. But for the most part, like you, we have animosity to do a lot of adjustments. I'm really excited for Agiloft to come in. There's one department that refused to work with legal and refused to use ConvergePoint, and they're our provider contracting. So they provide, or they contract with doctors and stuff like that. Right. So they're completely brand new to the system, and that's gonna be the group that's gonna be difficult to get to do these templates and stuff like that. It's interesting. And, and what's your name? Kim. Kim. So I mean, you have a sort of a perfect storm if you're in a healthcare organization, a provider organization- Mm-hmm...quaternary, tertiary care, so you know, high patient acuity.

41:51And uh, the stereotype is healthcare industry is slow to change, uh, combined with lawyers who are slow to change. So if you come in with that kind of structure though, I mean, sounds like a commercial for Agiloft, but I guess it is because the flexibility of the platform is very well suited to that particular use case. Because you're gonna have to make changes on a regular basis in order to get people to adopt it. Because they're gonna have deliberate points of view. They're not used to doing it a particular way. You're coming in with a deliberate point of view in a new function that never existed before, right? And you're working with doctors who also are sort of stuck in their ways as providers. So yeah, you do have a challenge, but I guess, you know, what we'd urge you to do, uh, from our experience is... is slow down, and even though you have a deliberate point of view, assume that you have to bring people along, right?

42:42You wanna get the other stakeholders excited about that implementation and be able to bring them in because, you know, I mean, we've, we've had this happen to us a number of times where we get halfway through an implementation and then other teams actually come in because they see the flexibility of Agiloft and, and they want different things, right? And then you have to backtrack. And, and I think, you know, those first couple of weeks of the implementation will be, will be big. You know, and we call it an immersive design, Agiloft does the same. And bringing everybody in, the stakeholders into that room to allow them to see what Agiloft is capable of, and then putting a document together to, to put those processes in place and map things out. Um, you know, my, my project manager's probably back there smiling right now, Kristen. It, it's definitely something that we've, we've worked on. You know, we've been doing this for five years now, and it, it, just in the past two years, it's, it's really changed being able to have that, that collaborative discussion at the beginning to make sure that, um, we're doing this. Because in the past, you know, people come in late, like I said, and, and they want different things.

43:37So I would definitely make sure that they're a part of that or- original conversation so that everybody's on the same page. And before we go, I will give, uh, two more recommendations. Like, there's a lot of resources in the Agiloft website. Like, if you go to the blog or the, or the resources, they have, like, a lot of PDF on what to do before the implementation. And one more that I will ask you to do is, uh, the World Commerce and Contracting has a amazing resources. It's like the library is there, there's people that talk about their experience on, on how they're building this and, and how to take this step back when, with the phase zero, and now how, how you can make the CLM implementation way more efficient. Yeah. And, and, you know, we've had folks on the podcast too that have talked about their implementations and, and talking about what to do, what not to do. Um, so, you know, a third resource I would say is- That's the third... a couple of old, older episodes, right? Agreed. And we are joined by the fabulous Sally Guyer from World Commerce and Contracting in the back, so welcome, Sally.

44:32Um, we must be out of time because Caitlin sort of- Yes But we'd love to- We've gone a little bit over. Um- Okay... can we take one more real quick? Sure. Hi. I just wanted to defend lawyers. Like, I might be the only lawyer in the room. Yeah, there you go. But- I'm a lawyer, too, so. I have the opposite issue. Um, procurement wants me to review every single contract that comes through. Right Um, whether it's our template or not- Mm... which it doesn't change if it's ours. So even if I have a playbook, how do you get them to take some of the ownership of their own contracts before it gets sent to me? Like, obviously warranties, I mean, even as a lawyer, that's a foreign language. That clause makes no sense. But I can't get them to make business calls without it going through me first, and I am, like, I'm the only attorney. My general counsel can't even find contracts in Agiloft. He emails me. Oh. So any advice or- Do you feel like they're throwing it over the wall to you because they have too much workload and they have the capability to do it? Or- No. Do they... Okay.

45:38They, you, you don't think they have the confidence to review the terms, so- Yeah, I don't think they have that, and I don't know how to help with that. I guess I could do that. I've only been there six months, so I kind of inherited- Yeah... this issue. Well, part of it is, I think we had a conversation before about how the CPO and the chief legal officer got together and like, you know, played golf or something. I'm just envisioning. But if, you know, they can actually... You, you are the lawyer. You're, you're the only lawyer, so you're... Right? In the organization? Well, there's a general counsel. There's a general counsel. But he's pretty useless. Right. Right. So, so, so I mean, if, if you can get together with them and put business objectives like, "We need to accelerate cycle time." Right? I mean, if the organization can say, "These deals are taking too long," you can say, "One of the key bottlenecks is I'm reviewing everything that I don't need to review, and I've put this artifact in place that can empower you to go further." Right? If you drive it to a business objective, you have a probably a higher probability of getting executive support. This episode of The Contract Heroes is sponsored by Koho Consulting.

46:39Koho helps organizations of all shapes and sizes find, implement, and manage their chosen CLM tool. Whether your project is buy or sell side led, Koho can help you navigate the waters of the CLM space to make sure that you're getting a product that's going to fit like a glove for years to come. If you'd like to learn more about Koho, visit their website at C-O-H-O consulting dot com.