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Recapping our Modern Contract Management Technology Webinar with Forrester
On April 27th 2017, SirionLabs conducted this webinar titled “Why Modern Contract Management is a Must in Today’s Procurement World,” in association with Forrester. The webinar featured Andrew Bartels, VP and Principal Analyst at Forrester, as our guest expert along with Ajay Agrawal, CEO at SirionLabs. This blog is a quick round up of the webinar including the Q&A. You can also watch the full webinar recording and download the slides here.
The webinar covered the following areas:
- Why Contract Lifecycle Management (CLM) is critical for contract management?
- How gaps in the traditional CLM approach result in value leakage?
- Leveraging modern CLM technology for effective contract management
- How Sirion is transforming the way enterprises manage contracts
Our guest expert Andrew talked about how services procurement has emerged as the predominant spend category for most enterprises over the last couple of decades. For contract management technology to be effective in this changed procurement landscape, it needs to expand beyond contract authoring and offer serious capabilities in the post-signature part of the contracting cycle.
Research shows that the failure to effectively manage the contract effectively across its life-cycle has a massive impact on the bottom line equivalent to 5% to 10% of the value of the contract (due to incorrect invoices, missed service levels, failure to enforce service level credits and penalties, etc.).
Andrew explained beautifully (see illustration below) how CLM technology can fulfill its true purpose only when it moves beyond the tactical and transactional benefits (e.g. faster contract creation, convenient storage, etc.) to enabling strategic and transformational value (e.g. improved business outcomes, stronger relationships).
Andrew then gave a glimpse of how the new generation of contract management technology is taking a very different approach to contract lifecycle management. By leveraging cutting edge technology concepts like NLP (Natural Language Processing), AI (Artificial Intelligence), machine learning, intelligent workflows and algorithms, integrations with enterprise systems, etc. this generation of CLM systems is turning the concept of contract management on its head. The focus of these contract management systems is not just on effective contract creation and storage, but on the fulfillment of the business outcomes promised in the contract.
Andrew concluded his section with a recommendation to consider CLM products with advanced contract management capabilities (outlining specific success factors that one should look for) to capture the full strategic value of contract lifecycle management. He also shared with the audience an expanded view of ROI that should be considered while building a business case for CLM.
After which, Ajay showed some real life examples of how Sirion is making advanced contract management concept a reality at some of the world’s leading organizations such as Vodafone, Vestas, and UCLH (University College London Hospitals). ICYMI, watch our earlier webinar where our customer Vodafone talks about their innovative commercial contract management program powered by Sirion.
Alright. Onto your questions:
There is a lot of discussion around digital transformation. But knowing that IT budgets are relatively flat, where does CLM stand in a CIOs priority list?
Andrew explained that due to the SaaS model, the CLM cost these days is distributed which significantly reduces the upfront investment burden. Also, the cost is distributed internally across departments that benefit from the CLM system. So it should be a combined effort between the General Counsel, the CPO and the CIO in making the business case internally.
Referring to the computational objects depicted on one of your slides – do they originate from the contract or generated by Sirion?
Ajay explained the recurring set of patterns of embedded mathematical objects that exist inside the contract in the form of service levels, KPIs, credits/earn backs, ARC/RRC, price books, rate cards, etc. Even though these don’t exist as algorithms in the contract but as simple mathematical formulae, it is possible to take these objects from the contract after the fact and convert them to computer algorithms in such a way that when the conversation happens with performance data, they can automatically reconcile the supplier performance with the contract.
That’s it for now. If you have any additional questions that wasn’t answered in the webinar or the text above, feel free to ask them in the comments or reach out to us at @SirionLabs. We’ll answer you there or amend the post above. Thanks for watching.
To learn more about Sirion, download the Sirion product overview document here.