How to create and implement a contract management policy in 2024

Looking put some guardrails in place for contract management? You're in the right place.

What is a contract management policy?

A contract management policy is a document or set of rules that provide guidance during contract creation and negotiation. It captures everything from best practices to approved clauses and processes, enabling other teams in the business to confidently self-serve on contracts. 

Why is a contract management policy useful?

Businesses can benefit from having a contract management policy in place for lots of reasons: 

• Reduces legal’s involvement: Instead of reaching out to legal for contract-related requests and questions, your commercial team has this knowledge at their fingertips. No more friction between teams!
  
• Faster contract workflows: You can turn contracts around faster by self-serving on contracts, instead of waiting for your requests to get picked up by legal. That means faster routes to revenue.
  
• Ensures greater consistency: Contract management policies provide repeatable instructions for what contracts should include and how they should be managed, making them more consistent and reducing risk as a result. 

But to do these things, your contract management policy needs to plug gaps in contracting knowledge and cover different eventualities. And that’s why what you put the policy matters so much. 

What to include in your contract management policy

The more detailed your contract management policy or playbook is, the more control you have. Below are some ideas of what these details should be:

• Approved clauses: a set of clauses pre-approved by the legal team.
• Fallback positions: the default position when counterparties try to deviate from standard terms.
• Recommended templates: a library of contract templates and instructions on when they should be used.
• Risk thresholds: how much risk you're willing to take on in different scenarios.
• Approval processes: when a contract can progress, and who it progresses to.

Common challenges

The contents of your contract management policy will only take you so far. You also need to implement the contract management policy, which is what most legal teams struggle most with: 

• “Reps just bypass the policy and come straight to legal still, so that friction still exists”
• “Updating our contract management policy is just more admin for legal to take on”
• “There’s no way to check that the policy we set out is actually being implemented day-to-day”
• “The policy isn’t flexible enough to be applied in different scenarios, and if we make it more flexible, it becomes too complex for non-legal teams to understand”

We hear you.

Standardizing contracting can be hard, especially when the existing processes (or lack of) have grown so familiar and contracts are in the hands of so many different stakeholders. 

But it doesn't have to be this way. Let's explore a few actionable ways you can increase adoption and bake your contract management policy into your day-to-day tools and workflows.

How to implement your contract management policy effectively

One of the best ways to implement your contract management policy is to automate it so it's embedded in the processes and tools you use day-to-day, with minimal manual input required.

This can be achieved by using a contract management solution like Juro. Here's how:

Juro gives legal teams the opportunity to automate their contract templates and lock certain fields, which reduces the risk of high-risk or unapproved terms sneaking into contracts.

These templates can then be populated in seconds either by pulling data in from other business tools (e.g a CRM like Salesforce), or by filling out a simple set of questions.

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Juro also allows template owners to set rules and conditions for more complex contracts, or contracts where there'd otherwise be a handful of different, slightly nuanced templates floating about.

This enables businesses to consolidate their contracts and automatically vary terms based on the values within a contract, whether that's contract value, geography, or something else.

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But that's not all. Juro's legal AI Assistant can use the information within your contract management policy to inform its responses to your requests. For example, it can review a contract in line with your playbook and identify key risks or deviations.

Similarly, it can draft contracts that adhere to your guardrails. This unlocks faster and more efficient workflows for the entire business.

Best of all, Juro's all-in-one contract management platform gives you the opportunity to regain control of contracts throughout their lifecycle, giving you fewer sleepless nights.

To find out more about Juro, and how it can embed your contract management policy into your workflows seamlessly, fill in the form below to book a demo.