Effective Contract Management

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1 Effective Contract Management How can we do the right things at the right time if we do not know the contents of our contracts? ProcessWorld 2011 Berlin, June 1st 2011 Michael Neumann

2 Agenda Background of the Contract Management study Contract Management Our understanding Study results Solutions to support Contract Management 2011 BearingPoint 2

3 BearingPoint is a European company with global reach BearingPoint in the world Partnership with the consulting firm West Monroe Partners for all projects in North America of our main clients Location of BearingPoint in 14 countries with 23 offices in Europe consultants in Europe Business Unit Central Europe for all projects of our main clients BearingPoint Australia Partnership with the consulting firm Bip for all the projects in South Europe and South America Business Unit Emerging Markets for our main clients, their subsidiaries and the big local actors in the Mediterranean area and Africa 2011 BearingPoint 3

4 Agenda Background of the Contract Management study Contract Management Our understanding Study results Solutions to support Contract Management 2011 BearingPoint 4

5 Every four years BearingPoint conducts an international survey 850 enterprises 29 issues-questionnaire 18 countries Very different lines of businesses Different enterprise sizes English and German Added 2010: - Self-assessment - Expert interviews 2011 BearingPoint 5

6 The study can help you to find answers to the following questions Should my enterprise or department improve its Contract Management? What should be the objectives of good Contract Management? How do other companies organize their Contract Management? On which Maturity Level is my enterprise/department? What can I learn from Contract Management experts? We want to Identify best practices of Contract Management Support you in determining and selecting the best approach 2011 BearingPoint 6

7 Agenda Background of the Contract Management study Contract Management Our understanding Study results Solutions to support Contract Management 2011 BearingPoint 7

8 Contracts can be found in almost every department of a company BearingPoint 8

9 Contract Management Helps to Improve Transparency and to Minimise Risks BearingPoint 9

10 The BearingPoint Contract Management Maturity Model uses an holistic approach OPTIMIZED : Contract Management is a strategic initiative. Focus is on continuous improvement of rules and verification. Connections to compliancy cockpits. MANAGED : Contracts are managed as an enterprise asset, welldeveloped processes for capturing, classifying, verifying and storing exist. Organizations provide detailed rules and internal control systems. PROACTIVE : The organization places much greater importance on contracts. Enterprises start to centralize action. Central archiving and basic search capabilities are provided. Partial existence of enterprise-wide rules. PROACTIVE OPTIMIZED MANAGED REACTIVE : Awareness and action occur in response to issues. Action is either system- or department-specific. Enterprises use storage systems for data and documents and introduce low-level regulation for processes concerning contracts. AWARE : AWARE There is an awareness that problems and risks exist but the enterprise has taken little action. Storage is done inefficiently through local hard copy or electronic files/folder. REACTIVE 2011 BearingPoint 10

11 Agenda Background of the Contract Management study Contract Management Our understanding Study results Solutions to support Contract Management 2011 BearingPoint 11

12 We have got Expert Recommendations for Contract Management Projects Keep it simple! Define the objectives! Management support is crucial! Define clear regulations and standard processes! Talk to all stakeholders! Don t underestimate change management! 2011 BearingPoint 12

13 Key aspects of contract management are related to contract controlling 2011 BearingPoint 13

14 Enterprises demand more centralisation of the Contract Management tasks BearingPoint 14

15 Most of the enterprises consider contract content related information as the highest risk 2011 BearingPoint 15

16 Enterprises see the need for improvements within contract reporting capabilities, IT tools and audit trail 2011 BearingPoint 16

17 The most important task of IT systems in Contract Management is the electronic filing and archiving 2011 BearingPoint 17

18 The most important interface is the Enterprise Ressource Planning (ERP) System BearingPoint 18

19 Customers expect strategic, process organisation, IT and research support Customers want: Compliance with terms and conditions or legal requirements Monitoring Risk management Process improvement and mapping to IT tools Consistent information Reporting, analysis, tracking Interfaces to Enterprise Resource Planing (ERP-) systems 2011 BearingPoint 19

20 Agenda Background of the Contract Management study Contract Management Our understanding Study results Solutions to support Contract Management 2011 BearingPoint 20

21 Which areas of Contract Management are covered by Software AG solutions? Contract Management area Content Definition of contract templates Definition of standard conditions, Filing (structured, complete, secure, central) Versioning, audit trail Fast search and retrieval of documents Definition of search criteria Controlling Compliance Monitoring Risk Management Approval, Signing, Workflow Reporting Process Definition of standard processes for certain contract types or departments Definition of rules and regulations, Support of each single phase of the contract lifecycle Interfaces to other processes, e.g. payment or order processes. Organization Interfaces to other systems Definition of responsibilities Definition of central and remote tasks Definition of Contract Management groups in single departments or enterprise-wide. Solution from Software AG SOA Governance Application Integration Business Process Analysis Enterprise Architecture Tools Comprehensive Integration Solutions BPMS BPA, EA & IT Planning SOA Service Lifecycle Management 2011 BearingPoint 21

22 We are looking forward to support you in your Contract Management initiative! Michael Neumann Senior Technology Consultant Tel: BearingPoint GmbH Ganghoferstr. 29 D München BearingPoint GmbH Kurfürstendamm Berlin Germany 2011 BearingPoint 22

23 IT SYSTEMS INTEGRATION PROCESS USERS Authentification Security und Data Protection Reporting Central User Interface etc READ EVALUATE EXECUTE MS Word, BUSINESS LOGIC DATA & ARCHIVE OFFICE SOFTWARE 2011 BearingPoint 23

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