In-house lawyers and attorneys are tasked with the endless cycle of documenting and organizing their firm’s contract negotiations. The ability to correctly interpret the purpose of a business deal and then accurately translate that deal into writing, whether it’s a sale of goods contract, a mutual non-disclosure agreement or a statement of work contract is a special skill. This isn’t any type of writing either; this is the complex, intricate legal syntax that can give even the most seasoned business professionals a headache. To add a little extra kick to the migraine, there are hundreds of these transactions made every day, translating into thousands of pages of writing. This isn’t a mission to face alone, Jason Mosley, corporate counsel for a leading SaaS company recently said in Inside Counsel Magazine, “Transactional business is a team sport.”* In that team spirit, I believe the complex drafting, approval and signing process behind getting these deals out the door should be handled as one too.
Transactions between business associates can vary in a number of ways, and the contract negotiation activities within these deals are key to the success of the relationship. If these activities are not thoroughly documented and organized, the entire transaction produces unnecessary financial and legal risk. Many inexperienced lawyers struggle because when they are included in these deals, it’s later in the process, when relationships have been established and many of the business terms have been decided. As a result, the lawyer is caught in a game of catch-up trying to interpret negotiations that have already happened with pre-existing customer relationships*.
There is more than one type of negotiation during any given contract. It could be the actual term negotiation (price, quantity, dates, etc.) or it could also be the negotiation of the actual language of the contract (structure, framework, clauses, etc.). When it comes to changes in contract language, as elementary as it may seem, a redlining and highlighting framework is key to reducing risk. So, during this stage of negotiation, version control is crucial. This means everyone needs to work off the same document, and the document must be the most recent version. Otherwise, each change represents time that is lost when a previous copy must be revisited and subsequently corrected…frustrating, I know.
Most people discount the simple tasks in contract negotiation - when in fact, these simple tasks, when added up, turn out to be the most time consuming. Being able to move swiftly through these stages without sacrificing transparency and accuracy is extremely helpful to a lawyer and an organization’s bottom line. There are tools that simplify these tasks and they’re available to lawyers and their respective firms. ContractRoom is one of these tools. It’s a cloud-based digital platform for all contracting activities. The software includes “Pro-Authoring” functionality, a patent-pending solution that allows users to collaborate (in real-time) on contract text, structure and wording. Negotiation team members, including counsel, are engaged in the negotiation at inception, reducing the “contract cleanup” that we so often encounter. Also, version control becomes completely automatic as the software updates and shows the most recent version of the agreement. ContractRoom saves time, money, and effort while increasing accuracy, transparency and productivity. ContractRoom takes the administration out of the contracting process so the legal department can do more with the limited resources that have already been stretched to the max.
* From Advice for young in-house lawyers: Documentation and negotiation insights http://www.insidecounsel.com/2013/08/07/advice-for-young-in-house-lawyers-documentation-an