Understanding Your Contract Management Maturity - Craig Conte

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

0:00Welcome to another episode of Contract Heroes, the show where our guests, and sometimes us, provide best practice recommendations on all things related to contract management. Hello, everyone, and welcome to another episode of Contract Heroes, where we're not the heroes, our guests are. And today we've got a, a great guest for you. It's somebody we've been trying to get on the show. We've been going back and forth for a while now. Uh, want to, uh, welcome Craig Conte to the show. Uh, so Craig, thanks for joining us. We're very excited to have you, and, uh, I think this is gonna be a great episode. We're gonna be talking about a, a lot. You have a ton of experience in the contract management space. So before we jump into some of the questions that we, uh, that we chatted about, we'd love to flip things over to you and, uh, just get a little bit more information on your background, where you're coming from, and, and you know, where you are now.

0:59Great. No, thanks, Marc. Thanks, Pepe, for having me here. Sorry it took so long. I wish it was because I was traveling and, and going all around the world, but Ho- ho- hopefully soon. Hopefully soon we'll all get to do that. Yeah. Uh, but thanks again. Yeah, been following you guys, have a great podcast and, you know, uh, thanks, I'm just glad to be a member of it. So I- I'm, I'm Craig Conte. I'm a partner at, uh, Deloitte Legal here in the UK. Uh, I'm part of our legal management consulting, and I run the contract piece here, uh, for UK and Europe. Uh, I'm a lawyer by training, you know, so don't hold that against me. Uh, I'm from New Jersey. Feel free to hold that against me. I, I probably deserve it. And, uh, I practiced law in New York City for 10 years or so, you know, primarily contract, you know, so mostly outsourcing and IT law. You know, I remember the, the first dot come,.com bubble, so th- th- I can age myself appropriately now.

1:54And then made the exciting move into Capgemini, where I was the head lawyer for their BPS, and then went to our CFO and made the exciting question or, or great idea of, uh, "Well, we have all these really complicated contracts. What are we... You know, who's watching these? Obviously, we're delivering and doing great stuff, but who's really watching? These things are, like, 1,000 pages long." He said, "That's a great question. Why don't you go, uh, look into that?" Which then led me into the world of helping Capgemini first go through its transformation to create legal and commercial, uh, shared services. So spent a lot of time in India, Poland, Guatemala, Brazil. All those are magical times of seeing great people, good food. And then, like all good things, we started selling this in, and helping clients go through, you know, their area of, you know, whether it's outsourcing, you know, whether it's technology solutions, transformations, and been in a few places. And now, um, I'm here at Deloitte, where we're doing the same thing. So, uh, really happy to be here and, uh, excited to talk about contracts.

2:53That's a great introduction, Craig, because, I mean, there's a lot of points I would like to go a little bit deeper, but we always love to open these interviews, in your opinion, like, why do you think that contracting process of every or- organization, not just, like, big ones, but every organization needs attention? Oh, that, uh, that's a great question. And look, I, I, I've been lucky. I've been able to work, you know, around the world. You know, South America, did a lot of work in for a bit. US, Europe, and, uh, Asia as well. A- and I gotta say this, like, you know, there's a lot of things that separate us, but there's a lot of things that bring us together, and contracts is one of them. Right. You know, very few companies actually make things anymore. What... You know, where the actual assets of a company are are all on these pieces of paper. You know, w- we could say that, you know, they're, they're buying and selling stuff, but it's all actually wrapped up in the contract.

3:46So, you know, contracts in organizations really are the lifeblood of it, the life essence, and everyone touches a contract, whether it's lawyers, commercial people, salespeople, procurement, finance, et cetera. It's touched by everyone, but owned by no one. Right. So there are very few companies, even if they do, you know, have sort of a head of contracts, it's typically just a piece of it, maybe, you know, the creation of contracts or maybe a vendor management organization. But the whole life cycle of how you, you know, start a contract, pick a vendor, pick a partner, et cetera, sign it and do it, that's a very broken, you know, activity. It, or it's broken up into areas within companies. And y- you see the companies that really, when, whether big, small or, or just, you know, or two guys, right? If they're doing it right, they're, they're usually, you know, it's very transparent. You know, there's not missing things. They're not having any mistakes. You know, they're not having, you know, big issues coming up with them.

4:44Uh, and they really can understand, you know, where their value's coming and going in their business, 'cause that's, it's all in contracts. I know we could say it's in Excel, but it really is. All the value is in those words that we write, that, you know, lawyers and other people write up for you. Right. I mean, it's... What I like to say is that every company works under a commercial relationship. Even either if you're on the sell side or in the buying side, at the end, it's all about commercial relationship, and there's no other place with more details on those commercial relationships than in contracts. And the contracts can become, or they actually are, the manuals on how you have to handle those commercial relationship. What's going to happen when things don't go well? How can you start a claim? How... You know? It's like you have everything there. And most of the times, companies and people thinks about contracts like they're just, like, a 1,000 piece of paper that once they negotiate for months and months, and they, and they spend a lot of money on lawyers, they're just putting them on files and cabinets, and they, they don't see them anymore unless something goes wrong, right?

5:54Yeah. And, and, uh, and there's something that we have discussing with some other guests in- here in our podcast, because there's a big mistake that a lot of companies are doing because- There's a lot of new technology. Legal tech is becoming, like, you know, like, this, uh, buzzword that is everywhere, and contract lifecycle managers are everywhere and, and companies are just like, "We want that piece of software," right? But the thing is, like, there are things that you gotta take, uh, care before you jump into technology, right? And I would like to ask you, Craig, it's like how can a company with no good contract management process implemented can take a first step? Sure. No, that, that's an excellent question. And, you know, also a good observation about contracts, just to jump back on that one. You know, the old way of doing contracts is- Right...

6:46people, like lawyers would write about the divorce, not actually how to do the ma- the marriage. Right? You know, how we're gonna, you know, do things together. Yeah. They're always worried about, like, whose rights are what, finger-pointing. Uh, luckily that's changed, um, or is changing still. So, so your question about, like, you know, where do you start, and, you know, how, how can you get into this? Now, look, I, I'm gonna say this, I love technology. I think that technology is better than it's ever had been, and every day it gets better and better, right? And, and but I also have to say that I think, uh, the technology has done... They've obviously put a lot of money into marketing. Because if you go onto, you know, social media sites or whatnot, right, it's very clear that out there that everyone says you need technology. And you do. Right. But, but if, uh, I've never seen technology just by itself solve a contract problem. It, you know, it's, it's literally, you know... Think of the most basic technology. What good is a pen without the hand that uses it?

7:41You know, what good is a car, uh, sorry, you know, those who are doing driverless cars, without someone to actually tell you where, you know, whether you're driving it or telling it where to go. What good is that? Same thing with the, the tools themselves. If you don't have a process, right, if you don't have a process, if you don't ha- if you have also bad contracts, right? If you, like, if you have the wrong people doing the job, if you have the wrong process for how things get done and the wrong content for doing it, the technology, you, you, you might as well just be putting water in a Ferrari, right? It's not, it's, it's not gonna work. Because- Right... if you have a clunky contract that's written, like you said, Pepe, like, you know, about, you know, hey, you know, you, you do this, you do this, it's, you know, very adversarial, and you put that into the, the best AI system or best workflow system, it's just gonna gunk up the system, and you're not gonna get any efficiencies from there. It's like- You have to-... automating a broken process. It's not going to benefit anybody. Yeah. A- a- or if you have, like, processes where, like, oh, how do we get contracts approved?

8:41Well, you know, we need 10 different approvals, you know, and it's co-signed like this for an NDA. Well, why? I- if you have a process that has too many approvals to it, you should be questioning, you know, well, what, what do I need a lawyer for? What do I need a commercial person for? What do, what can the business do themselves? You know, there's a magical weird thing out there that, you know, most people can read. And, and, and if you, and, and, you know, surprise, surprise, if you explain to them, "Hey, look, let's do a deal and it's fair, and let's do this, and it's relatively straightforward," you know, people can do that. You know, I know we like to think that lawyers invented everything, but legal systems haven't been around that long. You know, humans, uh, humans started first. Right. The Babylonians didn't have lawyers. Yeah, right. And I think that there, that's n- that's another thing, right? Not just the processes, but also, like, the content of the contracts. Because most of the time the contracts are drafted by lawyers for lawyers.

9:38And at the end, the people that are actually using the contracts and taking advantage of what is the, the content of the contracts is people in the commercial de- departments, the sales department or the procurement department. And if you write a contract with each clause, with, you know, like, these huge paragraphs and- Yeah... and they don't understand anything of the contracts, of course, they are going to ask all the time that the lawyers to try to explain what's inside that contract. And if you depend on a lawyer for every time you need to take a step, then of course it's going to take a lot of time more in all the negotiations. Right. No, exactly. And look, and lawyers are terrific, right? You know, highly educated, you know, great people in terms of, you know, doing hypotheticals and stuff. But as you said before, right, th- these documents are, are, are business relationships, right? Right. Business relationships in that, you know, someone in procurement, someone in operations, someone in sales has to do and deliver on, right? The lawyer, he or she gets to go home, right?

10:36And not necessarily deliver on this, or have to live with the implications of, you know, what the contract says. And then if someone at 12 o'clock at night on a Saturday has to figure out- ... "Oh, gee, what happens if, you know, this SLA isn't met? You know, do we have to stop? Do we have to bring in another company? Ah," you know, that's not useful. It has to be very clear and, and written for the people who actually have to live in it. Now, I, I think that's changing. I think, now, you know, a lot of lawyers are getting this, a lot of law firms, a lot of folks are, are writing it better. But, look, dinosaurs still walk the earth. There's still a lot of that out there that you, you would not say... It, it's still a lot of 1990s or 1980s version of contracting out there, as opposed to, you know, what we've all lived through. We just lived through or, or we're still living through in some ways, right, the largest force majeure event of our lives. Right. You know, i- if you're hiding behind that and not trying to figure out, well, gee, how are we gonna do business where we can't travel, or we can't see each other, or we can't do stuff, you know, you have to make sure the contract is elastic enough to really be practical and not just saying, "Well, you couldn't deliver." Well, no one could deliver. You know? You know, that, that's not helpful.

11:47How do we figure out how business keeps going? And I think the people who write contracts that way are gonna be doing a really good job for the future. Right. Yeah. I mean, I, I think that's, that's interesting, right, Craig? And I, I, you know, I think something we always talk about, again, on the show is, is how, um- L- legal's usually a late adopter to, to technology and, and bringing in new tools to, to help them, right? I mean, they s- they still use, you know, Microsoft Word and things like that, which, which isn't a bad thing. Uh, I think Microsoft does a great job of, of handling, you know, redlining. And, and some applications out there still allow lawyers to use, um, Word to do the redlining because they know how much they enjoy doing it in that manner. Other, other, you know, CLM applications do have their own native, uh, redlining functionality and, and in- inlining and stuff like that. But, um, you know, I, I think something that's interesting that you, that you said was, and, and touching on this still, is I know that Juro has recently came out with a new survey where they, they ta- talked with a bunch of their customers and, um, I think it was something like 30% of, of lawyers now that are in-house are no longer using Microsoft Word. You know, they, they're, they're using tools that are actually, um, more collaborative, uh, and, uh, like things that the sales team is using like, you know, the G Suite and things like that.

12:57I didn't know, you know, if in your experience, are you seeing any, any, uh, teams kind of making this transition as well or, or do you think that folks are still kind of sticking with, with what they know and trying to find other tools to integrate with? Yeah, no, no, that's a great, that's a great survey too that came out. I mean, I think it's a generational thing, just to be honest, right, Theo? I mean, I think, you look, the tried and true, right, of, you know, whether y- you're using, you know, Word, phone calls, you know, that, that gets the job done. And I think, you know, it's just opening their eyes and understanding how, you know, how and when this can be useful 'cause it, it's a big change management issue, right? And like I said, like whether it's, you know, Google Docs or Microsoft or, you know, there's tons of great products out there, and the CLM platforms themselves allow it. It, it's just getting people to realize that, hey, this is faster, right? This is better. 'Cause the, the old way was, all right, this is re- this is version 1.5 of, you know- ... 01:38, and then there could be version 1.6, and it just, you know, ping-ponging back and forth. Now, that worked. We got contracts done, but there's ways that, you know...

14:01Look, not every issue in a contract's contentious. You know, s- someone could be arguing about liability and payment terms over here and have negotiations going live in the contract here while someone's cleaning up the references to make sure that it's all Bob Smith and not, you know, Sally Smith or, or whatever, right? Mm-hmm. There's things that can be done this way. I, I think, you know, companies, you know, whether it's consultancies or technology companies that can bridge that gap and say, "Look, this is faster to people." You know, you know, business cases are built for companies, right? You know, and companies see the value of it, right? But an individual, right, just wants to get it done so that way they go home at 5:00 on a Friday and don't have someone panicking that, you know, calling them, "I need to get this contract done on Monday." Right? I- if there's a way to solve that problem so they can go see their kid's football game, right, that's, that's a great advantage, you know?

14:55And I think the companies that show that those collaboration platforms allow you more time to be flexible, to work from home, work from the office, work from, you know, the football stadium, right? Yeah. Those things that allow you to do that, that's the future. Yeah. Yeah, and I, I, I, yeah, I definitely agree with that. And I, I think, you know, I... Knowing, you know, your background and, you know, when you were at Capgemini and, and building out kind of this process from scratch, I mean, what do you think are the, the most valuable things to, to focus on at the beginning of, of this journey? Well, I think that's a great question. I think it's, you know, it's the goal of what you want to do. Okay. Right? You know, are, I... 'Cause I mean, depending on the company that you are, right, are, are you doing contracting 'cause... You, your risk, right? Now, there could be companies, if you're certain countries and certain industries, right, that, you know, you can't allow a blemish on anything, right? You know, sometimes the financial institutions, et cetera, they have to be, you know, cleaner than clean, et cetera.

15:52So y- you're really doing this from a risk perspective, and what you're looking for is transparency and control. So transparency and control means I wanna make sure this is automated throughout, I can see everything that's going, I have a perfect audit trail, right? So that's, that's why I wanna build a process that goes to that. If I'm in, you know, maybe, maybe I'm not doing life or death type contracting, right? Very few are. But, you know, if my goal is speed, right, then I wanna find something that, you know, allows me, you know, and I don't have infinite amount of money to hire infinite contract people, but I do have lots of people who can read. And I want to... You know, my contracts, maybe they're all under 10,000 or 100,000, whatever number makes sense, and you're not really worried about the risks as much. You know, I wanna get speed. I wanna put this... I wanna develop a system and a process, and I need a tool that helps me energize my staff, right, to go do contracts themselves. Now, back when we all were allowed to fly, right? Right.

16:50You, you know, the airlines came up with a great thing. To use their phones, and you can now... You know, I can check in, I can check my bag, I can do everything. I can change my flight all from my phone. I don't have to talk to people, right? You know, before that, you know, there used to have, be a situation where you had to go to a desk and, and wait in a line and do this stuff. We got used to it. Same thing with contracting. You know, if, as long as we take... I- if your goal is speed and allowing the most number of people to do something, then that's the kind of solution you need, you know? So I think it's always about finding out what is it, what's the problem you wanna solve? Because CLM, there's 250, now I, I saw someone say there's 400 tools, uh, you know, in the market, you know, doing something with CLM, uh, related. And, you know, it's changing every day 'cause they keep buying each other. You know? So, you know, they don't all do the same thing. There's sort of groupings. There's AI tools, there's drafting tools, there's post-award management tools, there's things that work with your ERP, there's things that work with your Salesforce, et cetera.

17:53Find the problem that you're really trying to fix, and then start thinking about how you go to it. Uh, w- where I see companies fail all the time is they just think, oh, you know, they, they read a blog, heard a cool podcast, or whatever- ... and, and thought that, oh, I, I need CLM, I want some of that. But what is it? It's like going to a restaurant and just ordering food. No, you order what you want. I want a pizza. Right. Right. Just give me what comes out. So Craig, like could you give us like, uh, any example on your experience, like what happens, like when a company with no, like I told you, like no good contract man- manage process, they would like to work with you, right? So we have a mess with our contracts. How, how it works, like what would be like the process? Do you need to do any kind of, uh, I don't know, like audit? Is, is there any stakeholders, uh, uh, that you think are important to be involved of, of this process? Like can you give us just like a, a, a walkthrough on, on how this, this work? Yeah, no.

19:02So whether, whether it's us or, you know, even you want to diagnose yourself, right? I would suggest if a company wants, you know, always happy, always happy to work with others. But you know, I, I think the, the key is just, you know, going through, right? You know, walk me through a contract, you know, who's using it, right? And first you gotta take multiple perspectives. Right. So is it, you know, are, are the, is the contract drafting? Let's use a, a common one, right? Mm-hmm. You know, what, what's the problem? And you say, the lawyers will say, "Well look, you know, the business has un- you know, has ridiculous requirements. They don't come to us... They come to us all on Friday, 4:00 in the afternoon. You know, uh, they don't appreciate or they, they don't understand that we have standards and we can't, you know, we have to escalate this." Then, but then you have to ask the other, the other perspective 'cause you're trying to solve a problem, and no one's completely wrong, no one's completely right. So ask the salespeople, let's say, right, you know, "What's going on here?" They're like, "Well, we don't understand why this takes two, takes so long, right? It looks like a 10-page document.

19:58Why can't we use the other com- why can't we use the other company's documents? Why do we have to be this?" So just understand the perspectives about what it is. We'll start to see, well, gee, maybe this is a communication issue, right? No one knows that we have these standards that, you know, it's net 30, net 45. We have, you know, these 10 golden rules of, of things that we can't change our contract. Maybe it's workflow. Maybe it's, you know, you- you're doing things that, you know, everything comes into the legal department sort of like a dump truck. It just gets backed up and, and dropped on them, as opposed to being routed the right way. Because I mean look, using a 20-year-experience lawyer to review an NDA is, is a waste of time. Right. There's no NDA worth that. Um, you know, so I think it's, you know, it's di- going through the process and seeing from different perspectives, you know, where the challenges are, and then start saying, "Well look, well if..." And then it's the best game in the world. "Well, what if I change this?" Right? What if I were to tell you that, you know, the legal department doesn't...

20:59as long as you sign this form NDA, which we've now simplified down to one page, right, or someone has created the one NDA- The one NDA... yeah, the one NDA. Hey, great idea. Um, you know, you know, if they, as long as they do this, right, you don't need to talk to legal whatsoever. Okay, great. Now we've taken the volume down the lawyers so they don't feel so stressed. We, they can work on things that make more sense for them. That's one step, and the business feels empowered. Well, why don't we go further than just the NDA? Why don't we go into, all right, if you're buying it on our template, you can do any contract up to, you know, 10,000 if you only change these three clauses. Okay. Mm-hmm. So now we can start whittling away and you can start building trust, so that way the salespeople don't look at the bi- at the lawyers as deal killers, and the lawyers don't look at the salespeople as weekend killers. So that way they can start, you know, finding ways that, you know, actually solve the problem. Big magical thing, right? In all human conflict, talking to each other and understanding perspectives works.

22:06It's the same thing- Right... with problem solving here. That's what we would do, right? That's, you know, what my team does. That's what lots of teams do, and, or companies do themselves, is just look at the problem and start challenging and, and, and being open to the idea that, hey, just because this is the way it's been done, it doesn't always have to be. Y- y- you know, one of the things we, we find companies do when they say, "Oh yeah, we have standards," it, we'll go, we'll go to them and say, "Here, let me s- let me see your contracting standards and let me see the last 30 contracts you've signed, you know, based on these standards." And then we'll do an analysis with some AI saying, "Well look, actually, you say, you know, you, you have this standard here that it's, I'll use net 30, you know, as your payment term." Over, oversimplifying, I know, people, right? Things are more complicated- Right... than that. But then 85% of the time you're signing up to net 60. Well, well that's your real standard, right? Yeah. This is, this is a theoretical standard you have over here that someone wrote at a time that made sense, but let's look at the real facts about what you're doing and maybe come to something, you know, closer to what the industry will do.

23:13I mean, there's a whole idea in contracting that like you, if you're a 10 and I'm at 1, but we know we're gonna end up at 5- Right... why do we have to do this ping-ponging of, you know, two, eight, you know, three, seven, fives? You know, like let, let's just get to something that makes sense quicker. So I, I think that's, you know, those are the things I would, I'd suggest anyone does, and that's what we would do, is just really just start mapping out the process. You don't need to be an expert in Visio, right- No... to just understand, you know, hey, how does a contract come... 'Cause you have a process whether you know it or not. Mm-hmm. It could be awful, but you know, there is a process. Something is being done, right? How does a contract come in? Well, does, you know, is email the way or is there something else we can do better? You know, when they do do it, are they marking it up based on standards that are, you know, partner-friendly, or are they, you know, things written in the 1800s you know- Right... that make no sense today?

24:12You know, I, I looked at a company two years ago that still had Y2K clauses in their contracts. Um, you know, and yeah, like, you know, and, and I showed it to them. They're like, "Oh, well, it- it's been there." You know, because, well, ano- that's another side is that, you know, contracts are Frankenstein documents. Yeah. People, you know, rather, rather than actually making it better, you know, I, I guarantee this happened in the last year. Someone said, "Oh, we need a better force majeure clause." So rather than changing the way their contract works, they just slapped on a new a- Yeah... amendment to just make it bigger and more clunky that it doesn't make sense. So that, I know I'm babbling a bit, but I would say that like you, you know, look at what you're doing, question what you're doing, and then try to change where you are, and get, you know, just be open. Yeah. No, I think those are some, some great tips.

25:02Um, and I think that that gives, you know, folks no matter where they are in this process, whether they already have a tool in place or, or are looking for their first one, you know, being able to take a step back and, and understanding that that should be the beginning of your process at any point in time if you think that the, um, the tools and the processes that are in place are not cutting it, a- and you need to, to kind of redesign things or, or take a look at, you know, another application. Um, so Craig, you know, working with, with all these, these companies, you know, that are, are out there and either, um, you know, are looking for their first, um, uh, contract tool, or, or, uh, maybe already have something in place, and again, like I said, you know, it's, they don't think it's cutting it anymore. I mean, how often do you see organizations with something in place that are ripping and replacing? That's a good question. Yeah. There, there's a lot of, uh, there's a lot of companies that still, like, they'll come out and they'll try to rip and replace. Yeah. But it, it, it's, uh, it's akin to someone saying, "Well, like, you know, I think I need a new car," right? You know, you know, "I n- I need to go faster." And then you go to their house and see that they have, you know, a Maserati, you know? Right.

26:10A, a, a, a Ford, you know, Ford Bronco and other things. You go, "Well, you, you know you have cars," right? "Oh, but I, you know, I want this type of car." Well, what you have can do this if you use it correctly. Um, so I think that's why a lot of companies say, "Well, like, you know, I, I want..." You know, a company had said to me, like, "Oh, we think we need, you know, a CLM, you know, because of a document management issue." Mm-hmm. Okay, fair enough. And I said, "Well, what tools do you have laying around?" You know, "What are you using now?" "Well, we have, you know, we have Salesforce. We have Teams. We have SharePoint." I go, "Well, you realize all three of those things could be used to solve the problem you think you have." So I, you know, I think if there's a rip and replace, you know, um, it's sometimes done just because n- they're not using what they have and they had a bad in- they had a bad addition in the first place, so no one got trained on how to use it. So human nature, people go back to pens and paper and work around the tool. Uh, you know, you do see, Marco, it's very q- I mean, there are some people starting realizing, "Hey, you know what? We got this tool.

27:15We used it. We've outgrown it." Yeah. You know, uh, "We need s- we're a bigger company now. We do wanna be more digital. Maybe it, it only just did document retention and some basic reminders, and now we're ready, you know, we think we've gone up the maturity ladder that we're ready to start using, you know, true workflow, actually get people, get lawyers to use a," wait for it, "platform as oppos- as opposed to emails." Uh, so you know, there, there are those who maybe, you know, augment, but you know, the true rip and replace is, you know, gee, why are you doing that? Yeah. Yeah. Yeah, and I guess, well, you know, when I said that, maybe I was thinking more along the lines of, you know, outgrowing something. Yeah. I think often we see, especially when, when we're, you know, in our sales cycle and, and being that, you know, um, Agiloft is so robust, you know, it is sometimes overkill for a lot of the organizations that we're, we're working with. But, um, you know, I, I think it's interesting to think about some of the tools that we're competing against, and are you out- gonna outgrow them? If not, that's fantastic. You're gonna save a lot of money.

28:16You probably don't need something this complex. But, you know, in, in a year to, to three years, are you gonna be outgrowing this, and are g- are you gonna be wanting something, um, that's more robust? And I, I think that's something that, that folks need to- Yeah... to, to, to think about. Um, so that, that's kinda where that question is going. No, no, that's fair, 'cause I feel like you, you want, you want, like, you wanna get on the digital highway, right? You don't wanna get in the digital- Right... cul-de-sac, right? Right. But you gotta understand, like, sort of like where, you know, what's your company, like, what's the problem you're trying to solve, right? You know- Yeah... if, if you know your company, right, and just the way it is, it's not, like, digitally native. You just want people to have, you know, good document retention, keep all my templates in one place, maybe some reminders when things are due in there. There's lots of tools that do that. And if that's really what you're gonna do, you're probably not, you know, you're not ready to outgrow. But if you are something that, you know, you are gonna transform and you are gonna be expanding, then you want something that can do that and, and X, Y, Z, right? Mm-hmm. More things down the road.

29:14W- where you sometimes have the problem is companies think, you know, "Oh, you know, I, I wanna be, you know, I wanna be an NBA player, so I need to make sure I have my agent and, you know, everything else set now." We go, "You- you're 10 years old, and you don't know how to play basketball yet." Yeah. "Maybe, maybe learn those things first a- a- and then get to the place and, and use the tool that makes sense now-" Right "... that can grow. But don't go and buy something that you'll never use." Like I, I don't think people are using blockchain too much anymore. Exactly. So Craig, you also said that, uh, one of the first steps that you gotta do before starting an implementation process of a good contract management, uh, it's, uh, to de- determine your goals, right? But one of the things that these type, these types of goals, such as transparency when a highly re- regulated company, or, um, speed for somebody who would just want to, uh, shorter their tu- turn over time for their, their contracts, it's, it's a little bit, let's call it, subjective, right? And it's, and it's very hard to monetize. Like how, in your experience, how can you calculate the ROI of a contract management process or consulting for a company? Yeah.

30:25So I mean, the, the sort of, it, it depends on the process. I'll give a lawyer answer, but right, if you, if you're thinking about, you know, pre-award, right, it, it's, the, the basic, you know, one is like, well, can I, can I handle more contracts faster, you know, with less people? Or with my same people, but scale up and, and do more, right? So that's the, so the, the, the benefit is that, look, y- you know, I have a team of 100 people to do, you know, 1,000 contracts a month. You know, you know, I wanna get to 2,000 contracts a month 'cause I'm a growing business, but I don't wanna hire another 100 people. So I wanna, you know, I wanna put a tool in, and only hire fo- four, or keep the same number, right? Right. So then, like, so the business case is that, but that's sort of looking just at the cost of doing something. You know, a lot of times the ROI can be how fast are you closing deals, right? How fast if you're, particularly if you're in a sales situation, right, how fast is money in the door? 'Cause cash is king, right? Right.

31:23You know, if I have a contract in time right now and, you know, and you gotta measure it, right? That takes, you know, it takes me six months to close the deal. If I, you know, I have volume, if I can do, go from six months to one month right, that's fi- you know, that means I can close more deals in a year. That's more revenue. That's more, that's faster to revenue in there. Classic one you see a lot of pharmaceutical companies doing this right now is realizing that, I think we all appreciate clinical trials now. I think we've all been really educated on that the last two years. Um, you know, a- and patents are monopolies, particularly in the US, right? You know, that you have, you have a limited amount of time to commercialize something. Well, do you wanna waste time contracting? You know, i- if I can cut my time down from six months to one month, right, that means now I've now, I've now made that patent more valuable to me.

32:17I've gained five months of monopoly, and that's, that's more than the cost of a few extra FTEs that reduced. So you gotta think outside and not just, you know, a lot of times people put the business case out there thinking, well, I'll reduce the number of lawyers, or I'll keep the same number of lawyers in there. That is a business case and it, it, it does matter. Or I'll, I'll move my bu- I'll move my lawyers from New York to, you know, Utah or, you know, or India, whatever. Right. And there's a, there's a business case for that too. Uh, nothing against Utah or India, lovely places. And you know, um, but I mean, that's just thinking of the closed box business case, where you really wanna think about is what's the impact on the business? If this is faster, you know, what will do this? That's the pre. On the post, the bus- the business case is typically, you know, the, the World CC has the classic thing of 9.2% of annual contract volume, you know, is wasted due to poor, you know, management. And where, where that is, it's like, it's like dumb stuff like, oh, evergreen contracts, contracts that automatically renew. People fail to actually terminate them, right? Right.

33:24Or, you know, uh, with heavy services contract, you, you end up paying for something twice. You pay for software licenses twice, or you pay for a service twice because you're not checking the scope. So you can, what we tell companies, just to be honest, right, is that, look, 9.2% is the average of where you're losing. But think of your volume, there's probably about one to 2% that you can really achieve 'cause you'll never get perfect, right? Right. If anyone's telling, if anyone's telling you you're gonna get perfect on something, they're lying to you or trying to sell you something. But, but if you c- if you can just move the needle a bit, right, and, and close out some of these little things, like to make sure you're paying the right price for something, make sure you're getting the right discount, make sure that you're terminating contracts you should terminate. All these little things as a, as a system, right, you can probably, you know, you can save one to 2%. There's real, you know, there's real case studies out there. They're out, you know, happy to talk to anyone about, but there's companies who really do actually get this and, and it's not just, you know, um, seat belts.

34:25You know, the, the business case for a seatbelt is, well, if you don't have one, you, you know, it's bad. Then, but the counterargument to a seat belt is, well, I don't get into accidents. I drive kind of slowly and I've never, I've been driving for 20 years, I never got into an accident. You know, luck is not a strategy, so please everyone wear seat belts. But same thing with contract management. Luck is not a strategy. You probably have lost money, you just didn't realize you lost money. You didn't realize- Right... it was a contract issue that, you know, you lost money. You thought it was Jenkins in procurement. No, no, no, it wasn't Jenkins' fault. Maybe it was, but you know, it was probably because you weren't following through on what your suppliers were doing. You weren't checking to make sure that, you know, you weren't overpaying for things because like I said, there's tons of paper out there and no one's checking it. If no one's checking it, you may get double billed. So- Yeah... th- I hope that helps in terms of just, you know, putting a little, some numbers on top of it.

35:20No, I, I definitely think it does, and I think that the, you know, the tangibles versus the non-tangibles and, and people need to be, um, aware of, of both things and, and thinking outside the box like you said for, for, um, uh, things that, that show value and, and show that, you know, you're gonna get, be getting some, uh, some bang for your buck out, out of these, these, uh, types of tools more so than, you know, what we typically find. And I, I think another thing to, to think about is, you know, how is this gonna help your customers? What is it, what is it going to allow them to do faster? Um, that's something else that, that really isn't talked about and discussed. So, um, just think about that. And, and Craig, this has been awesome. I, I know we're, we've been chatting for a while here. I probably could, could sit here for another 45 minutes, but we try to keep these things a little bit, uh, a little bit shorter. So, um, I just wanna thank you for coming on and, and a new question we've been asking some of our guests is, um, if you could, could recommend one person to come on the show and chat with us, uh, has anybody come, come to mind? Ooh, one person to come on the sh- uh, yeah. That, that's a good question. I mean, you know, uh, Kevin Feige 'cause I just really wanna know what's going on at Marvel, but, uh, no.

36:24Uh, but no, but that's a totally different question. I mean, look, you should talk to Alistair Maiden. You know, if you talk to him, yeah, he's a good guy to talk to. I mean, um, you know, uh, who else is good? Uh, you, you talk to, um, Emily Foges. Well, I, I, I'm, I'm giving some people from Deloitte, but yeah. Good. Uh, but I mean, I think there, there's a ton of g- the good thing is there's lots of great folks working in this space. You guys are great in it too, and it's, thank you guys for pr- you know, waving the flag for contracts. I, you know, as hopefully you can tell I'm very passionate about, and it's great to see that people are caring about them, so thanks a lot, guys. Yeah. Yeah, absolutely. Absolutely, Craig. And if, if folks wanna connect with you, uh, w- where's the best place to do that? Is that LinkedIn or somewhere else? Uh, you know, LinkedIn or Twitter. You can follow me, you know, Craig JKotte. You know, uh, you, you can search me in any search engines. I'm available pretty much there. You, you can get to my Deloitte site and, uh, please feel free to ask me a question.

37:20You know, w- we all work 'cause we all work together. All right. Well, thanks Craig, we really appreciate you coming on. Everybody, if you've made it this far into this episode or a couple of episodes, we'd love to have you leave a review, comment, pass it along to somebody else that deals with contracts on a daily basis. Hopefully you find this as helpful as, uh, as others do. So thanks for joining and, uh, we look forward to having you on the next episode. Thank you, Craig. Thank you, guys.