Category: Contract Certainty
Here’s a strange comparison for you: contracts are like concrete. But what do legal agreements have to do with building materials?
Think about a concrete foundation. If a foundation isn’t rock solid, whatever is constructed on top of it could collapse without warning-the same is true about any company. A business is only as strong as the contracts it’s built upon and its ability to fully understand and comply with those contracts. Things like weak liability and intellectual property protections, missed contractual milestones, inadvertent breaches, and misunderstood termination for convenience clauses are all recipes for disaster.
What if your company could eliminate that unpredictability and achieve total certainty over what’s inside 100% of its contracts? At Exari, we see this as a simple three-step process.
Step 1: Gain visibility into your existing portfolio of contracts.
Whether your company has dozens of contracts or thousands of them, it can be nearly impossible to keep track of every single requirement, restriction, and deadline. When your company’s revenue and reputation are on the line, staying ahead of your obligations and out of breach is imperative. But how could you do this without having to read every clause in every contract?
The answer is simple: Turn your documents into data. When contracts are imported into the Exari system, the most important clauses and information are pulled from the document, allowing business users to visualize and analyze this data in seconds with the help of dozens of standard reports.
Step 2: Gain visibility into your contractual risk.
Every contract contains several important risk factors…termination clauses, IP protections, payment terms, liability limitations, etc. Could you assess precisely how much risk is contained in a particular contract? How about the risk contained in your entire contract portfolio? Unfortunately, for many companies the answer is “no.”
That’s why Exari created a revolutionary algorithm that analyzes more than 20 specific contractual data points, determines the contract’s risk to your organization, and assigns it a simple risk score. And since these scores are based on a uniform set of data, you can compare apples-to-apples and fully understand the risk (or lack thereof) across your entire enterprise.
Step 3: Gain visibility into your contracting practices.
The easiest way to make sure that your company is creating low-risk agreements is to develop a standard procedure that promotes good contracting practices and prevents so-called “rogue contracting”. The question then becomes, how do you both tightly control your contracts while still providing the flexibility necessary to prevent legal department bottlenecks?
Exari’s DocGen™ allows all business users to do just that with an innovative and streamlined document automation system. Using a simple question and answer “Wizard” interview, DocGen™ lets any user create pre-approved, ironclad contracts, while integrated workflows loop-in the correct people, as needed.
Achieving 100% Contract Certainty™ has never been easier for businesses large and small. Think of it as reinforcing your wobbly foundation. You’ll be glad you did.
And since a picture’s worth a thousand words, please take a couple minutes to enjoy our newest video “100% Contract Certainty.”
At Exari we’re always innovating. Coming up with new strategies for making our customers’ experience even better is an obsession! We get the chance to talk with hundreds of companies about the contract creation process and we are consistently asked for help in making it more streamlined. A primary benefit of a contract management solution is breaking up the many steps involved in contract drafting, negotiation and execution processes so they can be more easily automated- freeing up more time for you to get back to important tasks. In addition to helping you easily generate contracts and better manage them, we are also surveying the market to understand what tools will help provide our users to continue to ease the contracting process.
After integrating with DocuSign at many customers, we’ve decided to formalize our relationship and establish a formal technology partnership. We’ve digitized the contract creation process from the beginning to the very end, sealing the deal with DocuSign’s eSignature and Digital Transaction (DTM) Platform. Our users can now enjoy the ease of contracting with Exari while using DocuSign’s secure, cloud-based platform for signing agreements instantly.
We can already see the value that DocuSign is adding for our customers. Now, users can accelerate their sales cycle and revenue error free, by eliminating the manual efforts of signature by being able to sign anytime, anywhere and on any device. This will not only increase customer satisfaction, but also keep you worry-free about contracts getting lost in the mail or being buried under piles of other documents.
To hear more about all of the benefits both Exari and DocuSign’s eSignature can offer your business, contact us now to discuss further or see a preview!
We recently discussed the new uncleared margin regulations (UMR) and best practices for successfully re-papering your Credit Support Annexes (CSA’s.) Now that you’re up to speed on what it means for your organization and the steps for re-papering, there is a bit more you should consider when evaluating each agreement. To get you the best advice we teamed-up with experts in this subject in order to bring you all the information you will need to successfully comply.
While adapting to these new regulations, complexity is going to be your greatest obstacle. You will have an increase in the amount of documents and data you need to manage, which means it will also be much more complex than previously creating or editing agreements. You will have to find a better way to manage the additional work required to support this intricate and time-bound project.
Depending upon which strategy you decide to adopt (or are forced to adopt by your counterparties) you may have to amend existing CSAs, create a duplicate to comply with the new regulations, or create a new CSA for the Counterparties (CPs) that want to renegotiate terms. Whichever strategy you end up with, managing the increasing number of agreements, and managing the legal and collateral terms is going to be a much greater burden for legal and operational departments.
In our upcoming webinar alongside Derivatives Risk Solutions (DRS), we will help you better understand the pros and cons of the strategies available to you, and how technology can help to ease the inevitable burden.
When: Tuesday, September 13th 10:00AM EDT / 3:00PM BST
*Can’t make it? That’s okay! Register now and receive a link to a recording once it’s completed.
The concept of contract management can get quite complex. There are many different contract-related challenges facing the modern enterprise, and they don’t affect all people the same way. The best way to get started is simple, yet highly effective – we call it the three O’s of contract management: Organize, Operationalize, and Optimize. You can move on to bigger challenges later, for example automation of contract drafting, approval workflows, and negotiation processes. But starting with the three O’s will give you a strong foundation on which to build:
1. Organize. Store all of your contracts in one place. Whether you keep them in a folder on your shared drive or somewhere in the cloud, the key is to identify major gaps and surprises (e.g. missing or expired contracts) and any major contractual risks that could expose you to unexpected losses or brand damage (e.g. uncapped liability, regulatory failures or rogue vendors).
2. Operationalize. Next, make sure the right people know about your contractual commitments and the commitments your suppliers have made to you. By extracting data about obligations and similar operational issues, you can share it, track it, and avoid the pain of poor compliance. This will mean fewer missed milestones, fewer pricing and payment errors, fewer disputes and fewer cost overruns.
3. Optimize. Finally, armed with better information about contractual risks, terms and process, you can make better decisions and streamline the way you do business. You’ll be able to find and eliminate bottlenecks in the contracting process, leverage past deals to drive better negotiation outcomes, and respond with confidence and speed during a crisis. Put simply, better contract insight will help you build a stronger, more valuable business.
Daunted by making changes in a large organization? Consider thinking globally, but acting locally. Your department or division is a great place to start your journey towards contract certainty and contracting excellence. It starts with better knowledge and insight. But as you grow and evolve, greater benefits emerge from automation and process improvement. It pays to think ahead and make a plan for where you want to go.
For more information about contract management, how it can benefit your organization, and additional resources please visit our contract management page to learn everything you need to know.
The guessing game is over. Brexit is official.
Pretty soon, the United Kingdom will no longer be a member of the European Union. Which means that lawyers around the world are scratching their heads about what it means for their clients, their firm or their company. Is it cause for panic, or a storm in a tea-cup?
One way to answer this question is to focus on what Brexit means for your existing contractual relationships. Which contract terms just became a whole lot fuzzier, and does it really matter? Some have suggested that ambiguity around “English” governing law will complicate dispute resolution. Others think that force majeure provisions may trigger a wave of unexpected contract termination. But a more immediate concern may be the impact of Brexit on territorial rights and restraints in commercial agreements.
If a distribution agreement gives your company exclusive rights in the “European Union”, you may soon be losing a big chunk of your market. If you have “European Union” non-compete language with a vendor, they might soon be free to set up shop in London. And if you’ve agreed not to move data or assets outside of the EU, your British operations may no longer qualify. In all scenarios, the first step is to find these potential problems and assess how painful they are. From there you can devise a strategy of renegotiating, repapering or restructuring before Brexit officially kicks in.
Of course, those of you with Exari Contracts have already done all this analysis and can enjoy a few days off at the beach. Perhaps a nice beach somewhere in Europe, while you still have the chance.
Last week, Exari teamed up with IACCM for an insightful webinar to explore the meaning of “Contract Certainty” and how you and your business can work towards achieving it. Attendees also got a look into our Universal Contract Data Model™ and what’s in store for the future with the newly announced CMA Contiki and Exari combination.
Exari’s Founder and Chief Product Officer, Jamie Wodetzki, kicked off the webinar with how you can begin to eliminate contractual uncertainty, like contracts that have expired, risks buried deep into the fine print and gaps in the paper trail. He addressed Revenue, Supply Chain, Process and Title Uncertainty, and the risks associated with each.
With all of the potential risks that live within your contracts, it’s crucial to have an enterprise view. This will allow you to constantly keep track of your businesses relationships with vendors, customers and trading counterparties. By having complete insight into all of your contractual data, you also gain an enterprise view of your business’s risk, the contractual risk score and a breakdown of where it lives. For example, your customer risk score might be lower than your liability risk score, giving insight into which ones you need to dig deeper into and work on.
Mike Maziarz, Exari’s VP of Marketing and Product Management, closed out the webinar with how we’re allowing our customers to move towards 100% Contract Certainty™, with the help from our Universal Data Model™. Mike also commented on the exciting Exari and CMA Contiki merger and how we complement one another to strengthen 100% Contract Certainty™ even further. If you haven’t watched the webinar recording yet, I won’t ruin it for you!
Click here to receive your copy of the webinar recording today!
Even after eight years since the financial crisis, we are still seeing firms continue to recover and take critical steps to put strategies in place for improvement. Firms are focusing on reducing their costs, while increasing their ability to respond to the changing regulations around ensuring financial health.
In particular, our largest global financial institutions are required to implement Living Wills with Recovery and Resolution Plans to ensure visibility under extreme financial or market pressures, and worst case, regulatory plans should the institution actually fail. While today we see how this only impacts the defined Global 20, it’s critical for these and other institutions to understand their contractual obligations and risks under all scenarios. The work to gain this understanding and visibility can be complex, time consuming, and costly.
Additionally, firms are having to respond to changes in the reporting of OTC derivatives going into effect this year. In fact, one of my global clients is looking at ways to unwind their current contract data to parse out the required details for measurement, reporting and re-papering of OTC derivatives alone. It’s a big job for many of our clients that is just getting started.
However, the well considered and industry-tested Universal Data Model delivered by Exari will significantly accelerate these institution’s view into their risks and minimize costs to analyze and respond. Assets Managers can easily reduce the time it takes to capture and analyze trading agreements, IMA’s, CSA’s and side letters from months to just hours. The Model is already enable our customers, like the one mentioned earlier, to significantly save time and money by managing this in house, rather than relying on outside legal resources.
The Exari Universal Contract Data Model for Financial Services is a game changer and is already being adopted by the industry leaders who want to accelerate the compliance process, minimize risks, and keep costs under control.
For more information on how Exari’s Contract Data Model, please visit our products page
Are you still drafting thousands of contracts manually? In Word? Or storing multiple versions of paper contracts in a filing cabinet? Well, you’re not alone.
Exari recently surveyed 92 Corporate Counsel and compliance professionals about their habits and challenges for contract creation, storage and legal technology. More than 75% reported that they were still creating contracts in Microsoft Word, using some form of “copy and paste” template, while only 1 out of 10 currently use a document generation software to streamline the process. Half of the participants (47%) said they were still using paper filing systems to house corporate contracts. Their top pain points included:
- Slow contract approval processes (59%)
- Little or non-existent insight into risk (39%)
- Missing key milestones (27%)
- Difficulty with internal collaboration (25%)
- Risk of error (23%)
With outdated practices for generating and storing contracts, you’ll lack complete visibility into all of your agreements, increasing your risks such as liability, being underpaid or overcharged and missing key milestones. By implementing an efficient contracting process, you won’t miss a step. Not to mention you’ll be able to pull information during a crisis in minutes, rather than taking hours to dig up and sift through multiple paper copies. Avoid missing renewal rates, reduce the length of sales cycles, streamline negotiations and increase internal collaboration.
Doesn’t that sound better than the ol’ “copy and paste”?
- Deep conditionality and complex business flows. Many of our clients think their contracts are in good shape and straightforward until they dig deeper and get better insight into how their documents are actually drafted, negotiated and approved.
- General document quirks. When automating documents everything becomes a lot more dynamic. What was a simple list, cross-reference or numbering scheme now needs to handle a variety of different conditional possibilities.
- Handling counter party paper. Even when you have your creation and management processes under control, eventually you’ll hit agreements that were not drafted your way or using your terms.
With the right tools these very tough problems disappear. And when they disappear, contracting and business processes improve and require less money and time making lawyers, business-people and clients alike very happy. Exari Hub gets you organised and on the road to understanding your contracts and negotiating processes. Exari Contracts takes the next step and allows you to control everything from creation right through to signature and archive. Come learn what we mean by contract certainty and why we’re pretty happy with what we became when we grew up.
*Editor’s note: This statement has some notable exceptions; automating contracts ultimately lowers the costs of legal work for clients making it more accessible. In a world where the average consumer or small business may struggle to afford necessary legal work, we believe that any measure that reduces the cost of access to the law is a noble pursuit. How’s that for a dinner party spiel?
I’d love to hear from you at @liptonj or leave a note in the comments.
Justin Lipton is CTO and Co-Founder at Exari.