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Contract Writing Best Practices: The Argument for Standardization

Jan 10, 2017 7:30:00 AM

Contract standardization has a history that is almost as long as contracts themselves. Due to the complexity of contracts as well as to the legal aspects of contracts, businesses and individuals have long used standardization practices in conjunction with all phases of the contract practice, from what contracts say to how they are presented and approved.

What aspects of a contract and the contract management process can be standardized?

  • Contract language. Since many contracts share at least a few similar goals, and since many contracts are serving as the same legal protections, it follows logically that many contracts can safely share language, from phrases and sentences to entire paragraphs or sections. Having a bank of common templates can save an enormous amount of time and provide the most legally sound draft possible if they are used consciously and correctly.
  • Contract design. The design of the contract itself can and should be standardized, from the way it is organized on the page to issues like font style and size. While the design and layout of the contract may not at first seem pertinent, a consistent and user-friendly design can help make the document more accessible, easier to understand, and more efficient to work with.
  • Contract assembly. The standardized assembly of contracts can also save businesses considerable time, money, and effort. Standardization can be achieved in this area through identifying standardization opportunities, creating an assembly system, training your team, and automating steps where possible - for assembly, workflows, approvals, etc. (The new method for document assembly - a modular approach)
  • Best practices analysis. Having standard practices for the analysis of your content management strategies is just as key as having standard practices for writing and reviewing your contracts. Examining the process as well as the result in a consistent and uniform manner can help you identify best practices and standardize other areas within the contract lifecycle management sphere.

The Benefits of Standardization Of Contracts

Some parties may at first wonder if contract standardization has any payoff – that is, if the time and effort that goes into identifying and creating standardization practices is worth the benefits of implementing them. The answer is a resounding yes  standardizing your contracts and contract lifecycle management best practices has a number of benefits that continue to pay off for years after you have created your systems:

  • Standardization improves clarity.
  • Standardization increases efficiency and productivity.
  • Standardization sets a bar for quality.
  • Standardization prevents errors.
  • Standardization makes analysis easier.
  • Standardization offers more legal protections.
  • Standardization saves money.

Contract Standardization Risks And Caveats

While contract standardization is efficient (and even necessary), there is certainly a such thing as too much of a good thing as well as a such thing as poor standardization practices. While some language – and even entire sections – of contracts can be based off of templates or extracted from master documents, it is vital to remember that all contracts are different and that similar contracts serve could different purposes. A clause that is appropriate and needed in one contract could complicate, clutter, or even endanger your deal in another contract. At the same time, the standardization of contracting processes may stifle creativity and innovation. However, these issues can be mitigated simply through proper planning, awareness and education.

Share your experiences with standardization... What changes have you made to your content and/or process? What's worked? What hasn't?

Our Series On Contract Writing Best Practices

The art of the contract is literally thousands of years old, but contract writing and design is evolving every day, especially with the advent of new research and technology. On our Agreement Blog, we are passionate about all things contract-related, but we are especially interested in how to make negotiation, contracts and workflows  – or put differently, the process of building more agreement –  better, more efficient, and more effective.

Subscribe to our blog today as we ask the following questions about contract writing best practices:

  • How can you find a balance between plain language and legalese?
  • What are the golden rules of drafting?
  • What makes a good contract?
  • How can we successfully assess contract writing?
  • How does contract software affect contract writing?

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ContractRoom’s blog, Agreement Blog, focuses on discussions related to business negotiation, contract management, B2B collaboration, workflow management, obligation management, among many other topics.

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