Breaking the Groundhog Day Cycle: A Fresh Approach to Contracts

By GABRIEL BUIGAS

Albert Einstein observed that doing the same thing repeatedly while expecting different results is the definition of madness. He had science in mind, but he could have been talking about contract lifecycle management systems (CLMs).

GROUNDHOG DAY

Corporate legal teams have been trapped in a kind of Groundhog Day when it comes to CLM deployment. There are three big hurdles for a business implementing a CLM:

1. The procurement, information security, and interconnectivity issues involved in rolling out a CLM within an existing corporate IT environment.

2. Change management driving adoption and new ways of working, absorbing valuable time that the practitioners would rather spend on core legal advisory work.

3. The tendency to over-engineer the initial implementation to cover every potential use case, customization, and integration.

Many in-house teams struggle to overcome these obstacles. Not because they lack competence but because of bandwidth, funding, and organizational challenges. CLM tools are meant to drive efficiency, productivity, and continuous improvement in how the legal function supports a company’s contracting needs. Yet, there has been extensive reporting on the perceived failure rate of CLM deployments.

Failure comes at a price — diversion of the team from core activities, job dissatisfaction, and increased attrition rates as workloads become unmanageable. And something else nobody talks about. The sheer effort and distraction of the effort can sometimes inhibit the ability of the legal team to innovate within their core function. There is just so much change an organization can handle.

When the implementation of the CLM stalls or fails to meet expectations, many stakeholders blame the tool itself.  Time passes and, eventually, a new CLM selection process is launched. This time around the hopes are high that the system will avoid the problems of the last one, but the underlying causes of the previous failure remain. Meanwhile, the legal department is now drowning in routine contracting workloads while morale sinks.

A Path Forward

If you look closely, you will see that CLM implementation challenges can largely be grouped as problems of resourcing and expertise. One solution is to buy contractsas-a-service (CAS), delivering both the CLM system and the required resourcing and change management capabilities.

CAS delivers the technology while assuming responsibility for continuous process support and evolution. The CAS provider takes on the review, negotiation, and closure of the routine contract workloads that are being processed through the CLM cost-effectively and under specific service-level agreements (SLAs).

Here are the specific advantages of CAS:

1. Reducing the complexity and delay of an IT procurement process, replacing it with a master service agreement (MSA) for an integrated solution that avoids complex internal IT infrastructure environments and integrations.

2. Transferring the principal change management and ongoing support risks to the service provider, who will operate under mandatory SLAs and reporting metrics.

3. Freeing up the in-house team’s bandwidth to focus on higher-value work and core functional innovation.

4. Driving the transformation of routine legal workloads, since a CAS solution is designed to reduce negotiation churn on lower value/risk matters.

5. Deploying generative AI (GenAI) use cases, as a well-structured CAS offering will allow in-house teams to directly access GenAI capabilities in advanced CLM tools so they can learn how to deploy them for additional use cases.

6. Portability, with CAS allowing the CLM software-as-a-service (SaaS) product to be taken back in-house through direct licensing if the client wants to re-insource.

It is time for in-house legal teams to escape the industry Groundhog Day of implementing a CLM on under-resourced and over-engineered foundations. CAS can be just as relevant for agile, high-growth businesses as for enterprise and large commercial companies.

How many times have we seen the high-growth dynamos going on hiring binges that produce inflated teams of professionals handling too much routine work? How many in-house teams have spent millions on a CLM implementation that hardly makes a dent in their productivity and innovation statistics? Is it just Einstein’s observation, or is there a bit of madness here?

Gabriel Buigas brings more than 25 years of experience to the legal industry, holding roles as an Executive Vice President and leader of the Legal and Compliance Solutions business unit at Integreon, a leading alternative legal services provider (ALSP). His depth of experience in legal services offers clients invaluable real-world insights and best practices.