Often acting as the subject matter expert and a single point of contact within your business is the contract manager (or commercial manager). The role takes on various responsibilities working across all areas of the business and importantly managing the senior stakeholders as part of the contract management lifecycle.
It is simply more than just the administration and filing of contractual documents given that the contract manager may need to facilitate the resolution of items such as insurance, tax, service levels, compliance, or I.T. onboarding issues in a contract.
Hopefully, the contract manager can take each deal from the start to finish of a contract by easing the pain points such as responsibility, legal review, and set the course for plain sailing.
Do you have a contract manager?
A contract manager deals with other businesses’ customers, suppliers, or partners and sits in the contract management team consisting of contract managers or in an in-house team within a business. Quite often the contract manager may be engaged to review or request further input from other areas in the following way: –
- Pre-sales review (Terms and schedules).
- Requirements capture or statement of works (SOW) review.
- Fees, insurance, risk.
- Contract negotiation.
- Business case creation, risk review and approval.
- Arranging contract signature.
- Service credits, set offs, governance.
- Operational review, reporting, invoice.
- Termination, notices.
- Personal Data deletion requests.
A bit more about the contract manager role
Perhaps your business has an existing contract management process using standard templates and uses contract managers for negotiations as and when required. Alternatively, your business handles several customer agreements or changes to standard terms which require a contract manager to negotiate and manage this from end to end. A contract manager also guides that sales and account team through the contractual risks along with the internal approval process prior to signature.
The majority of the contract manager(s) time is taken in dealing with complexities, larger deals, or deviations from standard terms. Getting the requirements, responsibilities, fees structure, termination and liabilities are key major areas to focus on.
According to Forbes contracts need to “facilitated effective negotiation and prove valuable after execution,” when the agreement makes sense from end to end managing the business risk it is easier to do business.
Key terms management
Often the first port of call for sales, stakeholders or suppliers’ questions is the contracts managers. This may be around items such as termination, warranties, liabilities and so on and it the understanding of what has been signed up under the contract that provides the value to any business. The contract manager with support from legal as when required may also be involved in some of these negotiations.
Is there a business case currently applied in your business? If there is one then this should capture all the points and any risks which are not aligned to the internal policies. Where a business case is needed then a contract manager can help to create one.
Before sending the business case ensure all items are dealt with and likely questions which arise around revenue recognition, risk, liabilities with avenues already taken are clearly explained. In line with the approval governance process of various delegated authorities regionally and globally the approvals should be sought.
Change control mechanisms
Contract managers may pick up contracts post signature at the request from the business to assist with changes either to add or change services. Sometimes there may not be change control covered under the contract. In such cases a contract manager must consider alternatives. So, it is good practice with contracts prior to post signature to include change control processes in order to facilitate these types of requests. Where there is a process already included this should follow the process in the contract.
Supplier management processes
Working with the service delivery team the contract managers can jointly work on establishing a process to include in the contract to manage, monitor the customer pre-contract and post contract. Using methods that are recognised by the industry will include mechanisms to drive supplier improvements. As the National Audit Office (NAO) says that the “best practices” do enable better contract management.
Contract management digital tools
With access to digital and online tools contracts will be filed, approved, and signed electronically to speed things up and make access available at fingertips. There are a number of applications which make the sales to cash integration with the CRM software streamlined for the non-standard contracts changes contract manger or legal are required to make changes. According to the Aberdeen Group the automation of contract management lifecycle “from creation to execution maximises performance” helps to drive process efficiencies.
Legal/contract negotiation playbook or templates
Your contract manager may have access internally to legal/ contract negotiation playbook or templates to access at hand enabling them in progress with negotiations. Where there are items which are non-standard or where a business which may not necessarily have access to this collateral a contract manager can assist with this.
If you need help with on-site or remote contract management, playbook, processes for your business we’re happy to discuss this with you email us at email@example.com or reach me on 07375 950 463.