Current Challenges in Managing Contract Lifecycle Management

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2 Current Challenges in Managing Lifecycle Management s are the bloodline of your business. Due to increased pressure in volume, complexity and regulatory compliance, contracts have evolved from a simple one dimensional agreement to a seemingly complex system. Numerous factors such as introduction of global supply chains, outsourcing, increasing economic uncertainties, geopolitical instability and new regulatory requirements have led to this rise in volume and complexity within contract management. Volume Complexity Compliance Grow revenue Reduce cost Improve risk and compliance If you are not in control of your contracts, you are not in control of your business. Enterprise Management is defined as the process of systematically and efficiently managing contract creation, execution and analysis for maximizing financial and operational performance and minimizing risk. Enterprise Management, sometimes called Lifecycle Management, is an emerging requirement for organizations not just to protect them against worst-case scenarios but to optimize the value they are getting from their contractual relationships. Studies have shown that contract management even in worldclass companies is poorly managed, undefined and less visible despite the fact that a contract contains agreements on pricing, quality requirements, service level agreements, terms and other conditions. plays a vital role in defining and managing business relationships. A contract serves as a primary driver to increase revenues, reduce costs and mitigate risks. Based on a recent survey by a leading research group, here are the top five factors driving enterprises to focus resources on Management: Dysfunctions in Management: Broken Creation Process Labor Intensive Templates and best practice not enforced cycle time is too long Missed revenue opportunities Employee satisfaction issues No common contract repository Multiple geographic locations Different media Several versions Related information Unable to access anytime / anywhere s involve high risk due to lack of compliance Monitoring of execution Reporting of performance analysis compliance management «Between 60% and 80% of all business-to-business transactions are governed by a formal trade agreement, with the typical Fortune 1000 company maintaining 20,000 to 40,000 active contracts at any given time.» Source: Institute for Supply Management 1

3 Enterprise Management will enable your organization to take better control of all your contractual rights and commitments throughout the organization. This will boost your operational efficiency by helping you increase revenues, reduce costs and mitigate risk. s constitute your business An effective Enterprise Management has the following core capabilities: Pre- Activities such as bids, proposals, vendor information and merging with e-sourcing tools Efficient Creation and Configuration from clauses, templates to models complete with capabilities for amendment and customization Strong Collaboration among all key stakeholders from a global and local perspective with failsafe authorization and execution system Secured Content and Document Management for workflow monitoring, audit trail, revision history and central document repository Solid Performance and Compliance Management system to ensure regulatory and contractual compliance as well as track agreed conditions as defined by the organization such as pricing, quality, terms, conditions and commitments Effective Resource Planning capabilities to control tasks associated with a specified contract including time and cost Automated Event Management & User Notifications for renewals, approvals, reviews and even for unplanned events such as variation and amendment orders Robust Business Intelligence / Reporting providing executives and management status reports, forecasts and other ad-hoc reports Comprehensive Integration with variety of applications such as existing ERP (Enterprise Resource Planning), CRM (Customer Relationship Management), SCM (Supply Chain Management) and other E-Sourcing solutions Effects for different roles Management: We have clear picture on our most important contracts, risks, obligations and suppliers, and also how this effects our company goals. Purchasing management: I have overview over the sourcing activities and can save money through common activities and economies of scales. Legal: We are compliant with our internal as well as external rules and regulations. Based on a recent survey by a leading research group, here are the top five benefits of ECM Solutions to ensure compliance & mitigate risk: Top 5 Benefits of Enterprise Management Solutions to Ensure Compliance & Mitigate Risk Compliance to service legal agreements 66% Monitoring supplier compliance vis-à-vis negotiated terms and conditions % 60% Realize the risks inherent in contracts 57% Visibility into supplier performance and risk management Good governance through compliance in regulatory requirements Sales management: I have overview of all sales contract activities and their status and can therefore forecast the business based on actual commitments. Financial and controlling: Now when I have control over our contracts I know that our expenses are based on our contractual content. 54% 54% 2

4 Capture More Value from your s through Implementation of an Enterprise Management Solution TransProcure leverages its presence in the market by delivering expertise and value-added solutions for Enterprise Management. Powered by a software technology called CMA Contiki, TransProcure can help transform your current contract management process to achieve best in class practices efficiently and effectively that will directly impact your organization s bottom-line and mitigate risks. About CMA Contiki and TransProcure TransProcure has partnered with CMA Contiki in offering the best-in-class Management Solutions to help businesses and organizations of various sizes and industries to manage corporate spend, increase savings, reduce costs, and maximize supplier relationships. Seventeen years of experience has allowed CMA Contiki to develop and refine how to combine the art of contract management with the science of ECM software to allow companies to not only achieve best practice but to achieve it efficiently. The result of this research is the Contiki ECM suite which gives companies the ability to take full control of every aspect of the contract lifecycle right across their entire contract portfolio. TransProcure is the appointed global partner of CMA Contiki and provides sales, support and maintenance to clients. TransProcure is rolling out CMA Contiki ECM Suite for all industries and sizes. CMA Contiki is the leading contract management solution provider, boasting some of the biggest names from a wide range of industries including Banking, Finance, Pharmaceutical, Telecoms, Engineering, Transportation, Energy, Utilities and Public Sector. Contiki Analyst Recognition Gartner Group: - We rated Contiki positive for the notable ease of use, the close Microsoft Outlook Integration, and good customer references. (MarketScope for Management Report) Aberdeen Group: - Contiki not only revamps the CLM processes but also ensures that everyone in the enterprise would have easy access to important contracts and contract data. (Halliburton Case Study) Forrester Research: - As one of the few vendors with a Microsoft-based product it has had success in companies that are attracted to its price/ performance value proposition. (CLM Market Overview) IAACM (Int l Association for and Commercial Management): - I am happy to recommend Contiki to any of my contacts - (IACCM Legal Expert) 3

5 CMA CONTIKI TECHNOLOGY CMA Contiki ECM is built using state of the art technology with service oriented architecture (SOA): Microsoft.net Multi-tier platform Utilizing XML CMA Contiki has proved to operate under a variety of different technical environments. The application functions as an integral part of Microsoft s architecture, making CMA Contiki ECM the only system in the market directly embedding Microsoft s Office applications. Contiki ECM-Functionality Overview Repository CMA CONTIKI ECM SUITE PORTAL OFFICE VP, PROCUREMENT CFO, HR & LEGAL VP, SALES CMA CONTIKI ECM PLATFORM BUY-SIDE IN-SIDE SELL-SIDE SOLUTION COMPONENTS ERP CRM SCM OTHER Process control creation award management Reporting & Analytics CMA Contiki Enables Control CMA Contiki ECM controls the company s commitments and privileges by managing the contracts. Enterprise Management is further a vital piece in pursuing compliance with the Sarbanes Oxley Act. The CMA Contiki ECM 6 Suite Covering all people, processes and technology needed to achieve best practice Enterprise Management. Contiki ECM-Functionality Overview Simple User Interface Results in Low User Threshold Contiki is built applying the same operational philosophy as MS Office and the user interface is similar to MS Outlook. This makes it very easy for users to start using the application. creation award management Reporting & Analytics Process control Workflow engine: Processes can be customized (using MS Visio) to role, client or industry need. Allows standardizing processes and enforcing internal and external compliance. To each step in a workflow process it is possible to set the business rules (if then else, roles, access, time etc.). User experience: Persistent feedback confirms that our clients love the user experience which is similar to MS Outlook Repository Access control on contracts & documents secures that only authorized personnel can access information. Single sign on is available Integration: Contiki Connector Kit includes connectors developed for enterprise applications like SAP, Lotus Notes, DocuLive, etc. Enterprise Wide repository: repository stores all contracts (buy-,in-, out-, sellside), for all locations, with related info (e.g. s), in one common central repository. Widely accessible through web, windows client and Portable edition. 4

6 How to get started... As your ECM consultant partner, TransProcure will effectively guide you towards ECM procedures that have been proven successful in providing the state of the art and visionary functionality and performance for ECM applications. Learn how to realize the full potential of ECM by creating optimal specifications and implementation roadmaps. Maximize the value of the ECM solution by following each of these steps. EXPLORE GRASP THE VISION WHAT S ECM WHY ECM AS-LS SITUATION TO-BE OPPORTUNITY WORKSHOP BUSINESS CASE IDENTIFICATION ROI EVALUATION IMPLEMENTATION OPERATIONS BUILD YOUR OWN ROADMAP ECM BENEFIT ENABLING ROADMAP WORKSHOP ECM BENEFIT PRIORITIZATION ROADMAP IDENTIFY QUICK WINS GO LIVE STEP BT STEP APPROACH: 1. PLAN SERVICE 2. BUILD SERVICES 3. RUN SERVICES SHOW THE VALUE CONTINUOUS OPERATIONS AND GOVERNANCE SECURE PAYBACK ON INVESTMENT CONTINUOUS IMPROVEMENT Cost-Benefit Analysis TransProcure provides potential clients with a Value Assessment, complete with Cost-Benefit Analysis that will help companies investigate where the benefits can be found, and the return on investment (ROI) they can gain by implementing the ECM solution. According to AMR research, ECM implementations take two to three months and achieve a 150% to 200% payback within one year. Though ROI estimates vary by organization and by industry, it is evident in research groups and early users agree that implementation of an ECM solution, if done correctly, can increase revenues, minimize costs and mitigate risks. Initial engagement begins with exploration of your current contract process. By answering a Pre-Discovery Questionnaire, we will help identify your current contract management issues particularly in the area of contract creation, amendment, storage and retrieval. From this quick and simple ECM feasibility study, we will provide a high level outline of a solution that will optimize the full potential of your contracts. TransProcure Value Assessment With a team of TransProcure s highly skilled consultants, we will help you pinpoint the current state of your contract management process, organization, knowledge, technology and performance. As your consulting partner, discover how to transform your organization s contract management from laggard or industry average to best in class. CMA Contiki ECM Demo and Webinar TransProcure can arrange for a demo of CMA Contiki ECM through an on-site visit or through a webinar. Please contact info@transprocure.com. Learn what ECM is and how it fits into your organization. We will educate and aid your organization in defining your ECM related needs both in business and technical terms. Laggards Industry Average Best in Class Processes Processes & policies are not defined properly, resulting in lengthy cycles; in cases, there are no processes. Partially automated processes that may vary between business units or functions. Policies not actively enforced. Clearly defined and enforced procedures and policies, using automated systems company-wide and standard contract language. Organization Lack formal contract management organization, roles, and responsibilities. management responsibilities shared across functions (e.g., procurement, contracts, legal) Either a formal organization within business units or one group managing supplier contracts across the company. Knowledge No central repository for contracts and very limited visibility into contract pricing, terms, clauses, etc. No mechanisms for tracking contract performance. Inconsistent visibility into contracts across the company, disparate contract repositories company-wide. Performance tracked only for high-priority contracts. Single contract repository companywide with ability to search contract data and terms and clauses. Enforcement of standard contract language. Regular scheduled audits and performance checks using metrics. Technology Little, if any, contract management automation. Mostly limited to MS Word/Excel for contract creation and management. management automation applied inconsistently across the enterprise. Commercial contract management solution used for procurement across the company. Integration with other systems (supplier performance, sourcing). Performance Less than 50% of purchases compliant with contracts. Approx. 75% of purchases compliant with contracts. More than 90% of purchases are compliant with contracts. Source: Third Party Research Provider 5

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