IACCM Contract Management Forum

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2016-01-21 14:10:34

Contracts Management Value - Changing the Corporate Culture

I am a new Contracts Manager at a global information services company. This is a new position to the company, so I am effectively starting from scratch. I am running into a problem where many members of the Sourcing/Procurement organization enter incomplete information in our Contracts Management system, or do not appropriately map documents together (MSA attached independently of applicable SOW, NDA, etc). Many of them view the logging as a burden rather than an integral part of identifying savings opportunities and keeping accurate records of our vendors. Also, we are switching CM systems later this year, and my fear is that if the culture does not change, the enhancements offered by the new system will be undermined by the inaccurate/incomplete data.

Have any of you dealt with similar problems, and if so, what processes/tips did you implement to increase adoption of your systems? Thanks for all of your input, including what worked, and what didn't.
 •  UK Crown Commercial Services  •   2016-01-22 07:26:06
We experienced something similar. We were able to run and produce reports which clearly showed at a very high level the number of gaps in the system info. We also put a sharp focus on the associated risks and missed opportunities that resulted from this. These reports were shared with senior management which put it firmly on the radar of those who needed to know. Important for us (and i imagine anyone) was to clearly link the risks with our organisational objectives so that it was very evident (even if some people thought it unimportant) how gaps in system info could and would limit our ability to achieve company objectives.
 •  Confidential  •   2016-01-22 14:26:52
I think you'll find consistency across stakeholders is an issue across more than contracts. Each function sees only the value in what is important to their process. We have been able to reduce (not eliminate) the issues you talk about thru establishing a centralized contract area. Only individuals in this area have delegation of authority to sign contracts. Additionally, I will say we do work very well with our stakeholders.

Good luck.
 •   2016-01-26 08:20:10
This is a problem I've encountered as well at a previous employer. It's hard to overcome when the "stakeholders" don't want to cooperate because it's a burden. Perhaps a training session where you emphasize the importance of the system (and keeping accurate records) and answer questions about how to map the documents would be helpful. Good luck.
 •   2016-01-26 08:30:55
Education, education, and more education. When we revamped our contracting process, it was a major shift in our organization. You will need to effectively communicate the value of contract management and the importance of accurate records. I have gone as far as using examples of contracting scenarios that placed our organization at risk because of failure to follow policies and procedures. Also equally important is senior leadership buy in. Because this is a major shift, you will need the support of your senior leaders so the message is coming from the top. I found that we were making very little progress in changing the culture until we engaged the support of our senior leaders. Good luck!
 •  OneView  •   2016-02-12 18:06:22
Unfortunately this is a problem with the tediousness of the task and the fact that legacy CM systems require manually uploading the contract. Our CEO is a 20 procurement professional that got frustrated with the old way of doing things and figured out how to upload contracts automatically to address this issue. He's been using it on an M&A project where thousands of contracts have to be renegotiated and reassigned. It would take years to input those process those contracts manually and he's been able to do it in weeks with accuracy.
 •   2016-02-26 15:48:29
I suggest you:
a) define and write up the purpose or importance of timely inputs (for all inputs being overlooked), and
b) measure and summarise the error rates and input times
c) prepare risk assessment and cost benefit analysis/ estimate (hard$ savings unachievable/ consequential time lost/ risk "contingency cost" vs input time) based on a and b.
d) survey all users to identify their excuses/ issues with the system/ lack of awareness/skills
e) summarise above in a report to exec management. Seek system fixes, user training, compliance enforcement and resources to implement these things.
f) If you don't get support from exec, then focus only on the worst problems that you are capable of fixing.
 •  ABB Contracting Co Ltd.  •   2016-03-30 09:05:04
We also experienced the similar situation and I believe this is somehow natural and common when the control, involvement of higher management and objectives of the people involved are not aligned. Sometime the pressure and the load of the work are also the reasons contributing to such a behavior. What we did was the following:
Conducted training sessions highlighting the importance of the issue and tis consequences for the organization
Top down message highlighting the importance and adherence of the process
regular check up of data and accountability

the outcome was good however it took some time and efforts are still on going
 •  ABB  •   2016-05-01 05:57:03
i had an over view about all the replies and they are all valid points - if we have a fresh beginning lets say its an advantage so you able to implement the rules rather than change rules - there many points to be addressed as below :
a. Contract administration.
b. relationship and process between different parties during pre and post tender award.
c. risk management and mitigation process.
d. periodical meeting for tender and project review.
e. contract management process and implementing it into a way to be effective and part of both tendering and project process.
... after all i would like to add its very important that top management within your organization to support that - and does not consider it as only consultancy or optional process.
 •  Contractswise  •   2016-05-18 10:26:49
Have you considered an e-learning module that would increase internal skills and awareness of what improved contract management can achieve? E-learning tends to be very low cost and learners can complete it at times that suit them.
 •  Bouygues Intl/SNC Lavalin/ Fluor Corp/MAVEN Group  •   2016-07-15 17:34:54
This is nothing new, rather very frequent in most organizations small or large. Systems are provided as tools to help managing our daily work; if not used and maintained properly to input and process data, no degree of sophistication would help. Having worked with a number of major corporations, using and investing in well developed contracts/procurement management systems I can only say that it happens a lot, but not difficult to overcome.
Like with all matters 'human' in the workplace, it requires continuous and diligent focus and efforts to train, motivate and monitor the users, frequent audits to check performance and usage for corrective actions, sometimes, unfortunately, 'constructive reprimands' are needed to bring everyone on track. It is important to have and allocate an adequate level or resources, systems and personnel combined and identified a budget needed for that to get support of your stakeholders. If you have a well developed contracts department with sufficient personnel, you could train and benefit of database technicians to handle such admin tasks regularly. I had the privilege to work in places where complex systems were designed and in place for contracts / procurement management. Every processing step would have key fields designed in such a way so if these were not filled as required, the user would be stopped from advancing to the next step and completing the task. And finally, such system would be directly linked with the AR/AP so that when getting to payments (this really matters for everyone) these would not be validated until the predecessors required activities/steps were adequately completed. That would be the show stopper. If a complex processing system is not in place, there is still good work to be done using well designed spreadsheets combined with your email messaging board to prompt actions due.
All in all, patience and interest in working with, and helping people to raise the bar and become professional in everything they do, small or big.
Lucia Galdian
 •   2016-11-04 00:00:55
I had the same issue with implementing a new tool nationwide. Agree with all of the answers - my solution was itemizing the ways that the tool would "benefit" the staff who were reluctant to learn the new application/system. ie legal ramifications, Good luck.
 •  Ericsson  •   2017-01-07 21:34:41
Dear Anonymous,
we are as well facing smth similar within our company, especially what concerns the Contract management tools and systems. Being a contract manager myself I have been a part of the team that is quarterly checking that deals selected by some criteria are properly stored in the tool. Almost all the time they were not. But since we have implemented the now tool it turned out that a sales team can not proceed further with delivery/execution process unless the contract is properly stored in CLM. So this tool is kind of a trigger - if a contract is there, then assignment can be created. And... for such upload - the responsible person is exactly the contract manager/contract administrator, i.e. the person who owns the contract and knows what to upload. Since that time all contracts are there. Sometimes such methods works as well and need to be applied.
 •  ATCO Electric  •   2017-05-18 19:30:51
We had similar situation. It is always same, nobody wants extra work, or deviate from their routine what they have been doing for years. We organized lot of information sessions, lunch and learn for key people to sell the idea to them. Once they were convinced that it is good for them and for the organization (or they realized there is no escape..), it was easy to implement our procedure and protocol with the key stakeholders.
 •   2017-07-14 17:07:01
I'm bringing in a contract management process from scratch, as previously I would receive instructions in a different form depending on the Sales person - and it was often a brain dump over the phone.

The approach I've taken so far is to approach the Head of Sales & the Sales Manager to get their support, but to also allign the information I want to capture with the information that they are looking for from the team.

It's useful to get backing from their team leads and try to demonstrate how the information your capturing will benefit them in regards to their targets. If they can see value, you'll find that they'll be having the battle for you.
 •  A+E Project Services  •   2018-04-13 17:05:42
You must list the gaps between your existing processes and what you want to be. These gaps needs to be controlled thru authorisation / automation if you are switching to a software support system else these need to be manually controlled by matrix. The next person in line will not sign till matrix is completed and checklist signed for compliance. this mau slow down but better than what's happening right now.
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