The old adage of KISS (Keep It Simple, Stupid) exists for a reason: Humans are experts at overcomplicating things, when often, the simplest solution is the best one. If you’re facing a litany of contract management problems, it can be tempting to hitch your wagon to a solution that promises to give you the world. But often, legal teams don’t need the world. You just need something that solves your biggest pain points without adding new complexities to your workflow.
It seemed like a good idea at the time…
I was seduced by the flashy technology...
I knew we didn’t need all those bells and whistles, but they couldn’t hurt, right?
These lamentations – and more – can be yours if you fall into the trap of over-solving your contracting problems.
At Pramata, we’re proud to be the radically simple alternative to traditional contract management. That’s because we’ve seen firsthand how much legal teams struggle when they try to over-solve their contract management problems. If you want to avoid falling into the overcomplication trap, read on to learn the top three reasons legal teams overcomplicate and oversolve for contract management – and what to do instead.
1. Contract management problem: Sales sees legal as a black hole
If your sales team is constantly “checking-in” on the status of their deal negotiations and escalating reviews up the chain (sometimes all the way to your General Counsel), you may have a “black hole” situation going on.
Without visibility into the contracting process, it’s understandable that the sales team is always following up and checking in, but it doesn’t build great relationships between the teams when legal feels like sales is hounding them or escalating questions higher than they need to.
The contract management solution
Provide the sales team visibility into the status of contract negotiations and allow legal to easily track and prioritize contract work.
The obvious answer to a contract black hole is to shine light on the process and provide visibility to any pertinent stakeholders. Unfortunately, this issue is ripe for overcomplication. A common over-solution is implementing workflows for multiple contract permutations.
The downside of overcomplicating contract visibility
Designing contract workflows is time-consuming. For in-house legal departments, especially solo-GCs and small legal teams, you’re too busy to divert attention from your daily work to focus on contract workflow implementation. If your team can’t take on that heavy lift, you’ll have to hire a consultant in addition to the price of the software you’ve chosen as your solution. That’s an added cost you might not have budgeted for, and it quickly eats away at the ROI you were hoping to get.
New workflows also introduce change management challenges, which in turn lead to barriers in adoption. If the new workflows increase the touch required to draft a contract or impose data entry on the requester, you’ve more-than-likely brought on a solution that’s destined to fail. If the chosen solution isn’t popular across the business, and people aren’t willing to use it, you’ll quickly lose the budget you worked so hard to secure.
The radically simple solution for contract visibility
The key to visibility during the contract creation process is implementing an intake process capable of showing the status of a request to all of the stakeholders. To be successful, the process should minimize data entry and additional touch to the contracting process. Whether using Pramata’s CRM integration or our native request and approval functionality, our workflow solution focuses on tracking the status of a request. Simply by working on the contract request in the application, the business will have visibility from the first draft to the fully negotiated contract.
2. Contract management problem: The business is using outdated contract templates
If your business has been around for any length of time, and hasn’t had contract management dialed in from day one, you likely have contract templates and versions living all over the place. We don’t have to tell you the kind of nightmare this becomes when different teams, or even different people on the same team, are referencing entirely different contract templates.
The contract management solution
You need a central location, accessible to anyone who needs it, to store the current version of contract templates. And this needs to be more than a shared network drive or a Google folder, or you’ll end up with the electronic version of the same problem: contract templates everywhere.
It’s easy to go down the over-complicated rabbit hole with this one and invest in a dynamic contract generation tool. For most legal teams, particularly small ones, this is overkill and only makes things more difficult than they need to be.
The downside of overcomplicating contract templates with dynamic contract generation
Dynamic contract generation tools sound like a great solution. But there’s a hidden cost buried in the amount of time it takes to design your dynamic contract tool. Take the normal effort required to create one contract template and multiply it by the number of permutations you need to design in the tool to support.
For most legal teams, dynamic contract generation tools end up costing you more than you expect both on the front and back ends of the process. You have to set up each template at the start, and then you have to maintain the tool as changes to your business and the law require from time to time.
The radically simple solution for contract templates
Pramata recognizes that for the majority of legal departments and their concerns with templates, the name of the game is ensuring that their various business constituents are using the current version of a given template. Pramata’s Template Library establishes a central location that users from every corner of the business can come to and be assured that they’re accessing the correct, current version of a contract template. They can not only know they’re getting the correct version, they can also quickly see when it was updated and any notes legal included wit the update. When your business has a place they know they can go for the right version, you can decommission the shared locations of contract templates from the past and have a future free of new deals on old terms.
3. Contract management problem: Multiple authors make tracking versions messy
Does a file name along the lines of “Contract V4.2.1_Final_Final_2” sound familiar? When multiple authors and approvers make changes to their own version of a contract, it soon becomes impossible to know which one is the real “final” version. Legal teams spend way too much time trying to discern which version of a contract they should be looking at, and this is not a productive use of your time.
Contract management solution
Getting rid of static versions and moving to a shared, cloud-based location for contracts seems like a great idea. Many legal teams have turned to their standard business suite of software like Microsoft 365, Google Drive, Dropbox, and others, only to find that they’ve brought old problems to a new platform. The next logical step is often to look at vendor’s proprietary contract negotiation tools. Unfortunately, this is a common way to overcomplicate your solution.
The downside of overcomplicating contract version tracking
If you’re using a contract software vendor’s proprietary contract editing tool, this automatically introduces the challenge of training your counterparty on how to use it. You think trying to get a new tool adopted internally is tough? Just wait until you try to get your counterparties to use your chosen solution! Especially if they negotiate heavily, they’re unlikely to use your tool. This limits its benefits and value to your organization.
The radically simple solution for contract version tracking
Well, one radically simple solution is just being disciplined in saving versions with clear naming conventions, but you can also leverage technology to arrive at a simple solution. In the Pramata Platform, each time you email your subsequent version from the contract request the next version of that agreement is automatically saved to your contract request record. This allows you to always understand the most recent version that was circulated with a counterparty without taking any steps to upload, name, rename, or file the next version.
Overcomplicate or keep it simple? The choice is yours
These three problems are very real for nearly every legal team that’s currently being pushed to do more with less. If you’ve already invested in a more complicated solution than you need, or if you’re considering doing so, know that over-solving your contract problems doesn’t necessarily mean you won’t find value in your solution. It just means that you’re almost certainly paying too much – whether that’s in cash, in time, training, or the hassle of internal and external adoption.
Why overcomplicate things? Keep it simple and see how Pramata can help. At Pramata our mission is to ensure your success and always stay radically simple in our approach to solving contract management for our customers. Check out our platform overview, or see it for yourself with a quick demo.