Today we are releasing the ninth episode of Icertis' podcast series, "Contracts Over Coffee." This series brings together the most influential voices in the Icertis Contract Lifecycle Management (CLM) partner ecosystem to discuss all things related to contracting while enjoying a delicious cup of joe.
In this episode, our senior director of partner marketing, Anne Baker, is joined by Dom Burch, vice president of marketing for our partner, Syke, a legal technology consultancy firm.Icertis · Syke — Dom Burch
Here are five key takeaways from our chat:
1. Automation is nothing to fear
Anne: What do you think is the biggest challenge with contracting today, particularly for healthcare?
Dom: One challenge [fear of] automation. People are sometimes a little bit fearful of the word because it does imply robotics, that they're not going to be required anymore. But really, it's about using technology in a way that enhances what you do. If you know what the best tools are out there in the marketplace and you're not using them, and your job is to manage risk or ensure efficiency, then, you could argue, you're not really doing your job properly. The tools we use should help us do the strategic work that can only be done by humans. Leave the technology to mop up and do the grunt work that's repetitive and mistake-prone.
2. CLM can be a major value lever
Dom: Contracts are so important, particularly in pharma or healthcare. Let's say you designed a new product. The importance of protecting that asset in a contract when you're licensing it to another provider or manufacturer is absolutely key because you might end up arguing over whether it's worth $100 million or $2 billion, so getting to that negotiation is really important. Therefore, it's also important that you don't waste time on the terms and the contractual backward-and-forward.
I was talking to a friend of mine who works in pharma over here in Europe, and he was saying that the legal department, through arguing for the rights of the patents that they had, was generating more income than the R&D department. Once you really understand the rights, obligations, and terms within your contracts, then it's incumbent on you to go out and protect those. And in this very complex, fast-moving, international, multi-territory world, in different languages—that's tough to do with a spreadsheet, and when you're relying on the corporate memory being inside the heads of your best people, who are stressed and busy. If you don't systemize this stuff now, you're building up potential problems or not generating the value that the business really deserves.
Anne: It's been really interesting because we count among our customers companies that are working on COVID-19 vaccines. The speed at which they're having to work and the collaboration with their competitors is like nothing they've ever seen. And all of that is governed by contracts. So we've had many conversations recently with those customers on what can we do to better support you, to help those contracts come to fruition quickly? Even last year before COVID hit, we surveyed a number of these pharmaceutical companies, and 73% said that contracting and administrative delays were causing delays in the sales cycle. From an administrative perspective, contracts are really playing a huge role.
3. In a world of headaches, CLM makes legal's life easier
Anne: One of the biggest benefits is the simple idea of having a standard clause library such that there's not a bunch of maverick, random contracts out there. And specifically for the healthcare industry, with all the changing legal requirements, being able to mass-amend your contracts across the board as a new regulatory requirement comes up is really important.
Dom: For example, with Brexit, that's going to change an awful lot of regulation, and contractually, an awful lot has got to change. Things are being rewritten into English law, and the implications of that still aren't clear.
What we would encourage corporate and in-house legal teams to think about is, “If not now, when?” We were on a call this week with a company, and they were almost embarrassed to admit that a lot of the information they store is on a spreadsheet here and there. There are a lot of large organizations out there who are yet to go on the journey. When you start any of these change programs, the people in the business start to think, "Wow. That's just made my life a bit easier. That was quicker than going to the legal team and asking for it." These little use cases become quite contagious in an organization.
4. There's no time like the present
Anne: What is one contracting tip that you wish every person knew?
Dom: Just get going. I used to run a sales operation, and we needed to replace our technology. There's never a good time to stop doing something when it's sales-related. A colleague said the experience was like doing open-heart surgery on a treadmill. And if you're waiting for three months while the technology is implemented, it's unlikely that everything going on will hold for you.
So you need to sit down with your teams and work it out: Where's the biggest win? And it might be something as straightforward as automating your NDAs. The terms are relatively straightforward, it's highly used, and you can get people familiar with using technology to generate their own contracts.
Being able to self-serve as a business user and not have to trouble the legal team allows them to do the job they need to do. Then I think you'll find the organization's resistance starts to evaporate. Start today and look for that early win, and then bring in the experts.
Anne and Dom wrapped up this episode with a little personal history: his academic background, his philosophy of business ("Fundamentally it's about people, right? It's about how people communicate"), and how working from home this past year has inspired him ("With constraint comes great innovation").
Want to read more? Visit Syke Tech Website for more information.