“Brexit” has been all over the news recently.
If you aren’t up to speed or you haven’t been following closely, the deadline for Britain to leave the EU was March 29th, though the UK government has recently voted to delay departure. The UK could still “crash out” of the EU, achieve some kind of partial exit or even decide on a second vote. This means that two and a half years after the initial referendum, it isn’t clear if the UK will leave the European Union and, if it does, what the final terms of the exit will be. In the balance are items with major commercial implications such as tariffs, customs checks and freedom of movement.
Amid the uncertainty, though, one thing is clear: Companies that have invested in and deployed an enterprise contract management system will be in a much better position to manage Brexit’s impact, regardless of its final form.
An enterprise contract management approach and platform means all your contracts are digitized. The digitization of contracts goes beyond just storing documents in a shared drive or online folder. Using modern contract lifecycle management (CLM) software, the contract is broken down into its component parts–clauses and metadata–that can then be searched and easily managed in a digital dashboard.
So whatever terms result from the Brexit tumult, a company’s existing commercial contracts can be quickly assessed for impact, giving CLM adopters a distinct advantage in terms of speed and ability to respond. And those who take an enterprise-wide approach to CLM (having all of their contracts in one system versus separate systems for sales, supplier and corporate contracts) can be even more agile.
Note, this commercial agility goes beyond just Brexit and can be applied to many other changes in regulatory frameworks. The passage of GDPR in the EU sent companies poring over their contracts only to find that many of them were hard to put a hand on and required manual review to understand the implications of that major change in regulation.
Similarly, many commercial situations require going through and assessing a company’s existing contracts. For example, in mergers and acquisitions, the company to be acquired typically has a set of contracts that are critical to review in a very short period of time to understand the risks associated with legal liability, contractual obligations, IP and customer contract expiry. Insights from contractual due diligence can make or break a deal and a manual review of contracts may or may not uncover hidden risks and liabilities. With an enterprise CLM system, contract review can be performed quickly and more accurately.
So while Brexit may have long-lasting implications, given today’s continually changing business environment, companies should explore how an enterprise contract management platform can increase their ability to respond quickly to a wide variety of political, regulatory and market changes.