- Reasonable rather than maximal positions. - Automated rather than manual processes. - Data-driven rather than relying on folklore. - Incremental improvements rather than large-scale transformations. - Collaborative with the other side and across your organisation rather than adversarial and siloed. - Accelerated rather than ponderous. - Long-term relationships rather than short-term transactions. (Location 195)

Tags: contracts

Note: .contracts

According to a Gartner benchmark in 2018[4], in-house teams review 75 per cent of contracts. (Location 248)

Tags: contracts, inhouse

Note: inhouse review 75% of their contracts

For over a decade, WorldCC has repeatedly found that negotiations focus on what happens when the contract goes completely awry (such as provisions covering liability limits, termination, and indemnities), (Location 274)

Tags: contracts

Note: .contracts

At Radiant Law, we know that if a law firm is involved on the other side of a negotiation, it will take three to five times longer to settle a contract than when it’s an in-house team (who aren’t incentivised to drag the matter out). (Location 361)

Tags: incentives, contracts

Note: .contracts conteacting with law firms takes far longer than inhouse teams

Principle 1: Contracting should foster great relationships “Contract law is essentially a defensive scorched-earth battleground where the constant question is, ‘if my business partner was possessed by a brain-eating monster from beyond spacetime tomorrow, what is the worst thing they could do to me?’” - Charles Stross (Location 388)

Tags: contracts

Note: .contracts

consider how contracting can help: - we can send reasonable first drafts - we can focus the contract discussions on what is essential to successful delivery instead of concentrating on liability if it goes wrong (Location 393)

Tags: contracts

Note: .contracts

__only once things are standardised can you start systematically improving them. __ This last point is crucial. It’s when you have a single, documented way of working that you have a baseline from which to make improvements. (Location 419)

Instead of a silver bullet, think in terms of a silver shotgun cartridge (or shell)—make lots of small changes rather than one big change. Try something, see if it works, embrace it if it does, and repeat. (Location 446)

RADICAL contracting focuses on creating quick, simple processes that prioritise what matters, relies on empiricism rather than opinion for improvements, and seeks to achieve good enough results with the other side to allow the relationship to get going. (Location 480)

Pursue perfection in your processes[35] but recognise that you will never achieve it. There is always something you can improve. (Location 560)

Tags: pareto, perfection

Repeatable First, put in place the basic tools that can be improved over time, such as contract templates, playbooks, and standard processes. These don’t require any automation; in fact, they need to exist before you can start to apply technology. (Location 601)

Note: You need templates,playbooks and proocesses before applying tech

There is so much we can learn from outside law! (Location 624)

Overall, I urge you to adopt an approach of prioritising action over discussion and, if in doubt, just do it. (Location 685)

Tags: action

Note: .action

There’s a massive advantage in your paper being the starting point of a negotiation: - there are only so many points that the other side can raise in practice, and - it gives you a boost out of the gate on smaller topics, - it significantly reduces the effort involved in the negotiation stage (you know your way around your template, and you can set the tone for the subsequent negotiations. (Location 806)

Tags: contracts

Note: .contracts

This is one of the two scenarios where artificial intelligence plays a role in contracting (spotting issues in the other side’s paper), (Location 824)

Tags: contracts, ai

Note: ai is good for spotting risks in the other sides draft

Define target service levels for acknowledging and completing responses, so the initiator has some predictability and can plan accordingly. (Location 853)

The following are typical indicators of whether particular attention is required: - the value and committed term of the transaction, - if the contract uses an unmodified standard form, - if it is just renewing an existing approved deal, - any material security or reputational risks, - any granting of guarantees or security, - any processing of personal data, - any material IP being created or transferred. (Location 887)

Tags: proj, contractrisk

Note: .contractrisk

Some teams specify cut-off rules when they don’t need to be involved, such as “less than £X in value, unless they touch on risk areas A, B or C”. Others use a points system to determine how risky a contract is. (Location 897)

Tags: proj, contractrisk

The length, it turns out, is particularly relevant. It has a dramatic effect on first impressions, and an agreement of only a few pages is far more likely to be looked at quickly and accepted. (Location 930)

Tags: contracts

Note: shorter contracts give a great first impression to the other side

A Manual of Style for Contract Drafting by Ken Adams (Location 939)

Tags: toread, tr

Note: .tr

By creating standard terms, you effectively crystallise your preferred positions on the different topics that come up within a given type of agreement. What this doesn’t help with is: - when the other side raises issues with your draft, - or when you’re working with the other side’s first draft. (Location 974)

Tags: contract

Note: .contract templates are less useful when using the other sides paper or when they raise issues with the template

It’s a document that captures what to do when you see an issue that regularly comes up in a negotiation. There are effectively two types of playbooks: The other side’s paper: When reviewing the other side’s paper, the playbook is likely to be a list of points based on principle, often structured as points you want to see covered in the agreement and points that you don’t want to appear. Your paper: When it’s your agreement, you should structure the playbook by following the underlying template’s order (with a few general points up front). You will find it reasonably easy to predict where the other side will raise issues. (Location 981)

Tags: playbook

Note: .playbook clause,issue,action,reason

Finally, it’s often better to get rid of a negotiation point than to capture it in a playbook. When issues come up, consider if you can get rid of them by tweaking your standard terms. Similarly, rather than having multiple fallback steps in your playbook, perhaps you could go straight to the end position to speed up discussions? (Location 1006)

Tags: playbook

Note: .playbook consider updating your initial position, and going straight to your ultimate fallback position

There isn’t a general recognised category of “ContractTech”, but beyond just email and Word, there is technology for sales, procurement, and legal teams related to contracts. (Location 1059)

Contract reviews: AI tools to flag issues in contracts on the other side’s paper that are based on whether particular types of clauses appear (or not). (Location 1080)

Tags: contract analysis, proj

We prefer point solutions at Radiant Law, but we’ve had to learn how to build the integrations needed to make things work together. There’s no correct answer to this other than not being paralysed by indecision. If in doubt, go with the simplest possible solution to meet your needs. (Location 1118)

Similarly, with workflow, there is value in modelling and controlling the flow of the end-to-end contracting process. Taken to its logical conclusion, this means bringing all the participants in the negotiation together on a negotiation platform, thus removing the need for email and Word. It’s a great idea, but it has a serious problem. In every negotiation, the other party will have to adopt the system instead of continuing with their usual way of working. Anyone who has tried to roll out a system with their team will understand how challenging this is. Some suppliers are working on making their negotiation platform as simple as possible, and perhaps one day this will get traction, but not yet. (Location 1140)

Tags: contractone

Note: .contractone

While AI can translate contractual language into another language, break down the parts of the sentence, spot dates and amounts, and—most usefully for our purposes—classify a clause as a particular type, the system cannot tell you what the clause means. We aren’t even close on this one. (Location 1159)

Tags: contracts, ai

Note: .ai .contracts

Contract review These are tools to review the other side’s paper to spot issues. These tools are clever. They let you __build rules for whether you want to see or not see clauses of a particular type and then warn you about what they find. __ The results are a bit crude, both because they aren’t 100 per cent reliable at finding clauses of a particular type and because the system doesn’t know what the clause means. You’re still going to need to read and mark up the agreement and then negotiate it to fix any problems found. (Location 1166)

Tags: contracts

Most of the AI tools out there are a pretty interface on open-source (as in free) AI libraries that are getting better all the time. We’re going to see increasingly powerful systems become available at lower and lower costs. Bear this in mind before making significant financial commitments. (Location 1185)

Tags: ai

Note: .ai

Your IT department probably doesn’t care as much about your problems as you might wish. They have a lot on their hands, and the contracting process generally isn’t their top priority. Instead, they’re trying to use fewer systems, introduce better integrations, improve security, and get business users actually using the systems they begged for. (Location 1200)

Tags: it

Note: .it

If your team isn’t using standard styles templates across documents, keyboard shortcuts, automated cross-referencing, and track changes, they’re doing it wrong. (Location 1223)

Tags: word

Note: .word

Your company inevitably has an intranet, so you don’t need to buy a system. (Location 1252)

Matter-tracking systems allow you to track the status of your deals and capture performance data, too. The status and key metrics can be shown on a dashboard, giving you an overview of workloads and performance. The benefits of these systems include: confirming whether you are meetings targets, helping balance the load across the team, understanding where bottlenecks are occurring, and potentially coordinating activities across the broader business. (Location 1288)

Tags: matter management

Turning on/off language: You may already have some simple document automation in your business that can only fill in blanks. These simpler systems don’t allow for sections of the document to be turned on and off and cannot handle complex contracts. Make sure that your solution has this feature. (Location 1346)

Tags: bamlegal, documentautomation

Note: .documentautomation

Editing: A simple editing environment will be critical if you want your tech-minded team members to automate templates. Ask for a demo of how this part works and run like hell if it needs serious programmers to create templates. Think through in advance the kinds of customisation your documents are likely to need and ask the vendor to confirm that their system can handle the intricacies (Location 1349)

Tags: contractautomation

Note: .contractautomation

Browser v Word plugins: Some contract management system vendors have created Word plugins to provide document automation capabilities. The browser-based systems tend to be much more powerful. (Location 1358)

Tags: contractautomation

Note: .contractautomation

Licensing model: Some suppliers charge a flat fee per organisation, some charge per end-user or document. Check that you aren’t going to be accidentally paying a fortune for the system as usage grows. (Location 1364)

Tags: contractautomation

Note: .contractautomation

Tools now exist that extend the scope of Word, adding functionality specially for lawyers. As examples of what these tools can do: - generating issue lists from contracts, reversing track changes (so you can quickly and demonstrably reject a change), - fixing broken documents at the press of a button, - better document navigation, - including being able to see pop-ups with definitions of capitalised terms, - checking for missing definitions and other issues, - cleaning up the track changes in documents (e.g., when your colleagues have all added their—conflicting—thoughts using their names), and - a clause database, allowing lawyers to insert preferred language into contracts and collect useful clauses for the future. (Location 1382)

Tags: word

Note: .word

Regular practitioners of project management may have been surprised by the sudden enthusiasm for legal project management (“legal” is almost inevitably prepended) when the discipline is old and well understood in other quarters. Still, it’s hard to argue that a little project management doesn’t go a long way with running legal matters. (Location 1443)

Tags: projectmanagement

Note: .projectmanagement

Should one use Agile, Lean, Six Sigma, or even Lean Six Sigma? What about design thinking or even visually designed contracts? Where does data analytics, game theory, behavioural economics, or evolutionary psychology fit in? If you don’t have a wall covered in Post-it notes, are you doing it all wrong? How can you make sense of this all and get going? First, it is worth recognising that across many of these disciplines is a common thread: start with the customer’s needs. Keep coming back to what matters to the stakeholders in your process (“customer” covers many of those involved or affected) and how you can better deliver it (otherwise known as creating value). (Location 1447)

As well as many potential stakeholders, many things may matter to them. Broadly, however, there are three dimensions to consider: Contracting process: how well the contracting process itself is running. Contract: the quality of the final agreement produced by the contracting process. Commercial relationship: the quality of the relationship created, which builds on both the process and the contract. (Location 1487)

Contracting process Time to close: How long does the end-to-end contracting process take[69]? We think this is one of the most important metrics of all. Cost and efficiency: How much does the contracting process cost for each contract supported? How much time does the team spend on each contract? Ideally, as little as possible, with recognition that it is inefficient to have multiple rounds of negotiations to close minor points. Reliability and responsiveness: How predictable is the process? How smooth is the process? Does the stakeholder know when they will get a response, and will it be quick? The time for requests to be acknowledged is often one of the most critical metrics for the business. We’ve identified strong correlations between customer satisfaction and this measure (which preferably should be just a few hours). Assurance: How good is the work product? Does it follow the playbook? Is advice helpful, clear, and to the point? Are you regularly giving key points away in order to close faster? Empathy: How did the stakeholder feel during the process? Were they heard? What was the tone of the emails they received? How flexible was the service to accommodate nuances? Did anyone pick up the phone and talk to them? Compliance: Was the correct process followed? Was the right information sent to the right person? (Location 1496)

Tags: contract

Note: .contract

Contract Clarity: How understandable and precise is the contract? Does it avoid ambiguity? Length: How short is the contract? Does it cut to the chase and focus on what matters?[70] Relevance: How relevant is the contract to what the parties are trying to achieve? Does it cover what matters for what they are buying and selling? Accuracy: How accurately does the contract reflect the underlying bargain? Are the parties getting what they expected? Usability: How easy is it to navigate the contract? Can the stakeholder find what they are looking for quickly? Can they be sure that they are reading only relevant part of the contract covering a particular topic? Legal application: Does the contract appropriately take account of relevant laws to give effect to the parties’ intention? Hygiene: Is the contract free of typos and formatted consistently? Are the cross-references correct? Interestingly, we occasionally see this metric as the only quality measure in requests for managed legal… (Location 1514)

Tags: contract

Note: .contract

Commercial relationship Meets commercial objectives: Has each party achieved its goals for the commercial relationship in the deal? Have the parties expanded the pie and gotten more than they hoped for? Relationship alignment: Is the relationship set up to succeed? Are the incentives aligned so it is in both parties’ interests for the relationship to be long-term and mutually beneficial? Is there a strong likelihood that parties’ objectives will be delivered? Is there room for the relationship to grow beyond initial expectations? Is the relationship well-positioned for possible future changes? Has the process created or reduced trust? Risk handling: Have risks been identified and addressed appropriately? Is the best party (usually the one with the most control of the outcome) bearing each risk? Has each party ensured that the contract does not pose a… (Location 1531)

Tags: contract

Note: .contract

Three steps to reduce the timeframes: Sort out the intake process using a form to elicit clear instructions that don’t need further explanation, Introduce document automation to create the contract in a matter of minutes Use e-signatures to complete approvals and signing in a matter of hours. (Location 1571)

Tags: contracts

Note: .contracts intake form, document automation and esignature

Who is going to do the actual automation? To automate, you need legal expertise in the subject matter and technical expertise in the system. Ideally, this would be one person. But the reality is that systems are too complex for you to assume that every lawyer will learn to automate their documents. The best outcome in practice is for a legal expert (who understands enough about the system) to work with a technical expert (who understands enough about contracts). The more legal background the technical expert has, the better, but people combining deep skills in both are unicorns (well, one or two exist). (Location 1754)

Tags: bamlegal

Note: .bamlegal

How to approach automation? Let’s assume that the automation is going to be done by someone other than the contract expert. Otherwise, the steps below will be more straightforward: - Get your template: You need to have a stable template before you can automate. - Flag the clauses that are optional and the variables: This can be as simple as square bracketing the relevant provisions and adding a comment to show which row of the table below applies. Variables (e.g., party name) just need to be flagged with a comment once. - Create a table of questions: Create a numbered table that sets out the questions and explanatory text (which will be an important part of guiding users and making the system more useable). Use comments or notes in the templates to link the questions to the relevant part of the template. - Automate the contract: With the information above, the person doing the automation should have most of what they need to complete the work, bar some clarifications. - Test: Back to the lawyer to test the template. It’s not practical to try every possible combination, but I recommend the following steps: walk through the questions and make sure that the right questions appear and the order is logical, compare the output (with one set of options) against the original template to make sure that it looks right, once you’ve confirmed that version, create a few other outcomes with the most significant structural differences to the first version, then run comparisons to do a sanity check, and test the questions with someone else—ask them to create a document, then watch what they do and where they struggle. However simple you think you’ve made the questions, this will inevitably throw up surprising issues that you can fix quickly[78]. - Launch: Once you’re happy with the output (and this process should take a week or two, not months), get your users to start using the system and have a single point for them to raise queries and suggestions. - Keep iterating (and keep adding templates): Get into a rhythm of looking at points coming up in negotiations that you can avoid by changing the drafting. Run a campaign to add more documents for automation based on successes to date. (Location 1773)

Tags: bamlegal, contractautomation

Note: .contractautomation .bamlegal

I am wary of futuristic takes on contracting, as the problems we face come from not doing the basics, and many of the solutions we need are available here and now. (Location 1900)

Tags: horizonscanning

Note: .horizonscanning many of the existibg problems arise from not doing the basics wel

While there will always be a need for specialist advice, I expect to see systems emerge that empower business users to run most, if not all, of the contracting process themselves. These systems will provide guidance and guardrails to allow the users to focus safely on the business issues and not on the contractual language itself. The challenge with these systems is that they typically require both parties to change their behaviours and drop Word and email, so we can safely assume that this won’t happen any time soon. I expect the parties will need to move to a neutral third-party platform that allows them to choose between negotiation options to minimise the need for free-form drafting. And if you can do this, then you can move to data-centric contracts. (Location 1948)

Tags: contractone

Note: .contractone

Tomorrowland: Scenarios for Law Firms Beyond the Horizon (Location 2012)

Tags: toread

Contracting Scorecard The Radiant Law Contracting Scorecard helps you measure where you are on the contracting journey and what to prioritise next. The Contracting Scorecard is free to use, and you will receive a customised report. Visit: www.radiantlaw.com/scorecard (Location 2031)

Tags: toread, tr

Note: .tr

Douglas Hubbard. The Failure of Risk Management 2nd ed, Wiley, 2020 An introduction to how to do risk management right. (Location 2085)

Tags: toread, tr

Note: .tr

David Frydlinger, Oliver Hart and Kate Vitasek A New Approach to Contracts Harvard Business Review, September 2019 An introduction to relational contracting. (Location 2110)

Tags: toread, tr

Note: .tr