Speed-to-contract is vital to your revenues.
As a P&L executive you know that.
As a former P&L executive — now practicing law — I know that.
But too many lawyers just don’t. They focus on verbal tweaks and “improvements” that hold up the process.
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It was only after I accepted a corporate client’s invitation to leave law practice and run one of its divisions that I understood how important timely execution is to doing the deal. Until then I was preoccupied, like most of my lawyer colleagues, with constant adjustment of terms in pursuit of a legally perfect document.
Of course the answer can’t be that we eliminate attorneys’ contribution to all this. Speed-to-contract that ends up with the wrong contract terms is self-defeating.
But now there’s technology that helps to accelerate the pace, while incorporating good legal guidance into a much more agile and timely process.
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According to Bloomberg Law (“DocuSign Wants to ‘Democratize’ Contract Negotiations”), 31% of companies don’t use technology for the contract negotiation process — they “manage contracts using spreadsheets like Microsoft Excel”. And Prashant Dubey, Vice President of Contract Solutions at Elevate Services, says that even at some of the country’s largest companies corporate lawyers still “run down the hall” and ask paralegals for help finding contracts.
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DocuSign is a publicly traded company with nearly $1 billion in revenue. They estimate that only 27% of companies use contract management technology that incorporate the best legal analysis into a software system that business people access directly.
Last week (the week of February 23, 2020) DocuSign announced its purchase of Seal Software, “a legal technology company that uses artificial intelligence (AI) to analyze documents and provide reports on what types of clauses they include.”
The idea is to reduce the role of in-house lawyers by helping the business people themselves to find, negotiate, edit, and sign contracts through what they call an “agreement cloud”.
DocuSign’s COO Scott Olrich puts it this way:
” … The agreement cloud is going to open up the legal function [corporate law department] to be a lot more strategic than it has ever been. We are going to democratize the technology to make it a lot easier for the sales reps, the service people, to be empowered to conduct business in a much more ‘self service’ way.”
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This sort of technology is a breakthrough that can neutralize what until now has been viewed as a zero-sum trade-off between high legal standards versus speed-to-contract.
Until now, lawyers have had to insist of flyspecking every change in contract terms as sales and commercial people work with the client corporation’s customers to close the deal. But this mother-may-I approach has slowed down the process and often alienated the customer who’s otherwise willing to begin payment.
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With this kind of technology, my fellow lawyers will need to realize that they are not the only smart people involved in the process, and they’ll eventually have to offer dollars-and-cents analysis instead of their traditional instincts and eccentricities.
Northwestern University Law School professor Dan Linna:
“Lawyers should be answering empirical questions … such as how much revenue is lost by the length of negotiations or the lack of insight into what the contracts actually say. That way they can help design a new, better way to negotiate and analyze contracts.
“Otherwise, there are plenty of other super-talented professionals who are not lawyers who are looking at unlocking the contracting process and unlocking millions of dollars in value. They will bring in lawyers where they need to, but they will not let lawyers stand in the way.”