Contractual Lifecycle Management (also clause and links)

Legal Dictionary	UCC - http://www.law.cornell.edu/ucc
Contract Lifecycle Management is frequently not a clearly defined business function. Contract lifecycle processes span multiple departments and roles. As a result, everyone has a different definition of Contract Lifecycle Management. Some think it’s the automation of the request process to eliminate bottlenecks for legal and sales or the negotiation, redlining and versioning process. Others think it’s active contract execution, financial terms management, product or service delivery, obligation management, or other activities. The fact is its all of the above. The true definition of Contract Lifecycle Management includes any process that contributes, creates or utilizes contract data. As a result, Apttus has defined the contract lifecycle to encompass everything from the initial request right through to the settlements of financial transactions around the agreement. This is a wide definition, but one that encompasses the entire process. We have built our product in a modular format so that depending on a customer definition of contract management, they can automate just that step of the process or utilize more modules to complete the entire process. Creating mutually beneficial agreements that suit the needs of both parties • Negotiating areas where opposing interests may present difficulties • Making necessary alterations to contract language and clauses to reach a consensus • Approving final contract documents to put the agreement into action • Storing the contract documents in a secure location for retrieval as needed by staff members and for future reference • Monitoring contract obligations and establishing deadlines for various milestones • Tracking and recording performance statistics to ensure ongoing compliance • Evaluating the contract to determine if it should be renewed or dropped at the end of the agreement period Contract management software packages typically incorporate features designed to streamline all these activities. Understanding the stages of the contract lifecycle can provide added insight for your company in managing these binding agreements more effectively. Before signing Comprehensive contract management software systems usually allow customization of pre-loaded templates to create forms uniquely suited to the company’s business model. By storing boilerplate language and frequently used contract templates in the software system, companies can save time when drawing up new client or vendor contract agreements. Once a draft contract has been completed, the negotiation process begins. While some clients and vendors will accept the first version of the proffered contract, others may require several rounds of editing and altering the language and terms of the contract before signing off on the finished product. Contract management systems make it easy to track changes and share electronic documents quickly and efficiently. Approval and implementation Contract management software suites typically include electronic signing and document transfer features that can speed up the signing process to a significant degree. Once the final version of the contract has been signed and certified, it can be stored in the central repository created by the software package. In some cases, documents are stored on-site in corporate servers and accessed through the company network; other configurations provide access through secure login technology and maintain the data in remotely hosted server arrays. By creating a searchable central repository for documents and data, contract management software allows easy retrieval of contract information and provides access for advanced reporting and monitoring features. Tracking and evaluation Monitoring vendor performance can help companies determine whether or not to renew a contract at its natural expiration. Compiling and evaluating performance reports by hand can be time-consuming; worse yet, errors in figures or in calculation can skew the results of these manual analysis methods. The reporting features and tracking alerts provided by contract management software packages can provide more information and reliable data for managers, allowing them to make the most cost-effective decisions when renewal time rolls around. By incorporating contract management software solutions into existing workflows, companies can boost staff productivity and ensure the quality of their contractual agreements from start to finish. 6 Stages of Contract Lifecycle Management 1. Authoring a. Use of Standardized templates for different types of contracts b. Use of Clause Library c. Ability to capture the terms from Sourcing/ previous contracts 2. Negotiating a. Submit to the counterparties for feedback, comments and corrections b. Reach mutually acceptable T’s & C’s for the relationship 3. Approval a. Approval based on workflows like Fiscal Approval, Legal Approval, etc. 4. Storing/ Repository a. Should be enterprise-wide searchable b. Reports on Contracts 5. Compliance Management a. Contract information should flow into procurement & sales processes b. Track Supplier/ Customer compliance with price discounts 6. Renewal a. Renewal, based on expiration date and internal & external factors.
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A1 Enterprise	15
Agiloft	2
ASC	13
CLMMatrix	18
CobbleStone Systems	7
Contract Analyst	20
ContractAssistant	4
Ecteon	10
GEP	3
GettingContractsDone	12
Great Minds Software	17
iValua	19
Ncontracts	11
Novatus	9	Others not reviewed
Omega	14	(IBM - Emptoris&DiCarta)
Onit	16	(LLR Partners- I-Many)
Prodagio	1	BlueRidge
SciQuest	8	APTTUS
Selectica	5	SpringCM,
Symfact	6	ContractLogix
THE TOP 5
By Total Customers
ContractAssistant	1000
CobbleStone Systems	500
GettingContractsDone	285
Prodagio	200
GEP	150
THE TOP 5
By Total Users
Agiloft	4000k
Prodagio	4000k
Selectica	2000k
Symfact	1500k
GEP	1000k

Contracts Types and Clauses

Types of Contracts / Agreements	Clause Library
Cost Plus Fixed Fee	cost plus fixed fee contract charges a flat fee for the actual cost of materials and a flat fee for labor regardless of whether or not the project incurs any overtime.
Cost-reimbursement contracts	Cost-reimbursement type of contracts provide for payment of allowable incurred costs, to the extent prescribed in the contract. The contracts establish an estimate of total cost for the purpose of obligating funds and establishing a ceiling that the contractor may not exceed (except at own risk) without the approval of the contracting officer.
Fixed-price contracts:	Fixed cost to buy a product
Incentive Contracts	Incentive contracts are appropriate when a firm-fixed-price contract is not appropriate and the required supplies or services can be acquired at lower costs, and in certain instances, with improved delivery or technical performance, by relating the amount of profit or fee payable under the contract to the contractor's performance. also..Cost - Plus - Incentive-Fee (CPIF) Contract This is a cost-reimbursement type contract with provision for a fee that is adjusted by formula in accordance with the relationship which total allowable costs bear to target cost.
Indefinite - Delivery Contracts
Labor - Hour Contracts	A labor-hour contract is a variation of the time-and-materials contract, differing only in that materials are not supplied by the contractor
Master Services Agreements
Non-disclosure Agreements (NDAs)
Service Agreements
Time and Material	time and materials contract charges precisely for everything used with an exact cost plus hourly fees for labor
Rental / Lease Agreements:
Operating Lease
Fair market Value Lease
Fixed Fee
Reagent Rental
Contract Lifecycle Management
Contract Clauses (very limited selection)
Assigment
Audit rights
Benchmarking
Changes in Law and regulations
Confidentiality
Default remedies
Definitions
Fees (base charges, incremental etc.)
Force Majeur
Governing Law
Indemnification
Insurance (risk of loss)
Intellectual property rights
No soliciation of staff
Out of scope services
Payment terms
Service
Service Levels and SLAs
Statement of Work (SOW)
Taxes
Term
Term and termination
Warranty of Merchantability
Software:
Acceptance testing
Copyright / patent
Indemnification
Ownership
Ownership of Background Technology
Source Code
Warranty
9 clauses in custom software development contracts that you must take extremely seriously or risk losing a lot of money, time, and even your most valuable information
Clause 1 - Specification/Spec Document	Make sure the spec document is extremely detailed. The fewer the specs, the more room for error and interpretation. When designing custom software, the last thing you want is for someone who knows nothing about your business or your customers making judgment calls about gray areas. Read it multiple times. Study it carefully. Sleep on it. Then read it again. Programmers will follow this like a Bible.
Clause 2 - Delivery Schedule	The delivery schedule should list the exact delivery date for each deliverable or software release. This is how you find out along the way whether or not your programmers are on schedule. You wouldn’t believe how many businesses fork out cash each pay period only to find that the programmer is only halfway finished on the date the project was supposed to be finished.
Clause 3 - Payment Schedule	A payment schedule sets forth the amount and time of the developer's compensation. Push the risk to the back of the project. Let’s assume that a project’s development project is 6 months. Your payment schedule may look something like this:
	month #1 you owe – 10%
	month #2 – 20%
	month #3 – 30%
	month #4 – 40%
	month #5 – 50%
	month #6 – 100%
	This will do two things for you. First, you can cancel early with minimal loss if you can tell right away that the project is going sour. Also it will motivate programmers to have a larger payoff at the project’s completion.
Clause 4 – Delays	Offer the developers a bonus based on a success condition. It doesn’t need to be a huge bonus; just some stake attached to the success. If the developer completes the work according to the timeline set forth in development plan, you might agree to pay a bonus of $500. If the developer finishes the work and is late between 1 and 60 days, the bonus is lost. If developer is late for more than 60 days, give yourself the right to subtract 5% percent from the total amount for each month of delay caused by the developer.
Clause 5 – Maintenance	Established pricing for the support later on. Programmers know that you will need support for the software after completion of the initial project. Getting support prices in writing before hand means that they won’t be able to bargain with an exorbitant rate at a time when you have limited options.
Clause 6 - Indemnification/Code Ownership	All of the code, algorithms, documentation, derivatives—everything, should be 100% yours upon completion of the project. Some developers will underbid, expecting to later create a product or resell the same software to your competitors.
Clause 7 – Warranty	Get an agreement from the developers in writing that you will receive 6-12 months of defect and bug fixes for free.
Clause 8 – Confidentiality	Confidentiality is extremely important. Over the course of the project, your software developers will find out intricate details about the exact inter workings of your company such as your employee’s names, your procedures, your forms, how you get your customers, who your partners are, and access to all of your pricing information. Make sure they can not become a competitor or disclose that info.
Clause 9 - Mediation/Arbitration	Make sure that any court proceedings are in your state. You don’t want the extra cost of travel in case something goes really bad.

WhitePapers:

Infosys

Hummingbird

Enporion_CLM_white_paper

ASC - Is-yourContractManagement-just-Good-Enough?

OpenText

Infosys - OpenText

Infosys - Are you meeting your contract obligations?