Contract Management in a New Context: Blind Men, Elephants, and Visibility (Part 2)

by | Aug 13, 2022 | Contract Management

contract management

Today, organizations have many choices when selecting a Contract Lifecycle Management (CLM) solution.  Some solutions may come from a content management provider as part of a wider usage of sharing content.  Others may come from ERP systems, who argue that you’re simply leveraging just another module within your ERP.  Someone focused on these two options may be considering CLM as just an add-on functionality or an afterthought to using one provider.

Still, other CLM options come from specific functions, like Sales or Procurement, who are looking to link processes together based on Source-to-Pay (Iasta’s traditional focus) or Quote-to-Cash (Selectica’s strength).  But even here, using a contract management solution for the convenience of putting contracts into one “functional bucket” may not be the best approach long-term. Focusing within CLM process areas may provide depth and industry knowledge, but you also run the risk of being too narrow and not understanding the wider trends or impacts of how contracts are being managed across the enterprise over time.

Contract Management

Perhaps an old Indian story will shed some perspective. Most of us have heard the famous parable of the “The Blind Men and the Elephant,” but for the sake of all others, here is a version:

Six blind men encounter an elephant. One grabs the leg and concludes it is a tree trunk. One holds the tail, thinking it is a whip. Another touches the elephant’s trunk and decides it’s a hose, and another pats the side, concluding it’s a wall, and so on.  While each has his own opinion, each is partly right and each is wrong.

Regardless of which blind man we are talking about with regard to CLM (customers, suppliers, providers, sellers, legal), all parties still need a common approach for managing and housing the common tie that binds them – “the contract.”

For most organizations starting their journey, the goal should be driven on where contracts reside and then extend into more advanced areas such authoring, common workflow, online negotiation, contract analytics, mobile contract access, and so on.  But with new CLM capabilities in hand, such as universal workflow and process management, organizations will be able to manage the practice of implementing contract process improvements across the entire organization, while addressing the wider compliance, performance, and risk issues facing sourcing and supplier management. Moreover, today’s advancements in technology integration and mobility remedy the past issues of providing an enterprise-wide and centralized contract visibility to all key stakeholders.

Despite organizations implementing different systems for sales contracts and intellectual property agreements, providing a unified CLM ability to manage the functionality, integration, and process flows will provide the most value over time.

In part 3 of this blog series, we will conclude our discussion of enterprise CLM in the context of upstream procurement.

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