Question

A midsized biopharmaceutical (ALFA) company with hundreds of employees worldwide recently faced a crossroads. The company was growing rapidly, but its internal contract management process wasn’t equipped to keep up with the demands of a larger company. Because the company relied on paper-based manual processes, it encountered inefficiency across departments. End users submitted paper forms for contract requests, but often experienced confusion about which information was required for different types of agreements. This led to time-consuming back-and-forth with the legal team. Once they submitted their requests, end users lacked visibility into progress. As a result, they frequently made phone calls to check on status, and typically had the false perception that the legal department was causing bottlenecks. Meanwhile, the legal team faced efficiency challenges of its own. Attorneys and paralegals spent long hours filling in missing information on contract request forms, and handled all manual workflow themselves. Lacking a single system of record, they were forced to perform redundant data entry into multiple back-end business systems. In addition, the legal department’s interaction with the procurement team was inefficient. Legal’s handoff of completed contracts to Procurement—a critical step for the creation of purchase orders (POs)— remained an uncoordinated process. End users had no way of checking the main clauses of contracts with suppliers and checking the requirements for purchasing items. The company’s general counsel recognized the impact of these problems on the entire legal function. The lack of visibility into the current legal workload made it very difficult to plan (or justify) legal resources —and nearly impossible to generate any meaningful business intelligence about the department’s functions. In addition, ensuring compliance with the organization’s financial policies was extremely difficult, exposing the firm to serious financial risk and decreasing negotiating power with vendors.

What is the problem for ALFA company, how do you evaluate the company contract management performance, and What are the recommendations that the ALFA company need to follow and apply to improve their contract performance (with examples)?

Answer 1

The problem for ALFA companies is the lack of an integral system of record and adaption of technology.

ALFA company is based on paper-based manual processes instead of using new technologies and online networks in order to conduct its work.

This causes many confusions regarding the contracts and is also time-consuming.

Contract request forms lack visibility and they miss some information too. The manual work is overloading in the company.

According to my evaluation, the performance of contract management is inefficient. They lack an integral system of recording the contract requests. They should adapt and use new technology in order to reduce manual paperwork with lots of confusion and difficulties regarding reading the information and recollecting the missing information.

Recommendations that ALFA company need to follow and apply to improve their contract performance:

1. Try to reduce the paperwork and go online, try to automate the work of keeping track of everything. Use instruments like email or another application for contracts instead of papers.

2. Try to examine and improve the current processes and procedures for improvement in the future.

3. Templates should be used in order to standardize the language of the contracts in order to make it easy to evaluate and understand.

*PLEASE RATE WITH A THUMBS UP *