CEO / C-Suite
The CEO is NOT a Contracts Manager
The CEO or Sales Executive who thinks that he can manage his contracts function is betting his company on his ability to check details and not miss a crucial point.
The CEO, Biz Dev, and Sales Executives are usually “big picture” people (and rightfully so). They are results oriented and usually not inclined to do a thorough contracts review, or even think about where the disconnects may be in the sales process (RFQ / Quote / Negotiation / Booking / Performance – Order Fulfillment / Delivery / Billing / Warranty - Support / Follow-on Sales).
Rules of Engagement become the basis for Success
Contractual documents form the primary element of Rules of Engagement. Your ability to succeed is to a great extent determined by the contracts that you make with your suppliers on one side, and with your customers on the other.
Most small [and many medium-to-large] companies are woefully ignorant regarding what a customer's or vendor's contract can do to them. Just as bad, they are ignorant of what their own well-written contract can do for them.
Processes are a necessary part of Rules of Engagement. Processes can be very simple and straight-forward. A process merely describes the steps to be taken to accomplish a task.
Standards make up the third element. Standards can be very simple.
Some examples of standards are:
- payment terms,
- quotation terms/conditions & validity period,
- limits of liability,
- ownership of intellectual property,
- Guidelines for addressing certain situations can also be standardized (for example: how and when to escalate a problem).
Contracts Management = Profit Management
Add the three elements and the result is smart Contracts Management.
A good work flow system involving contracts management can better assure that the client understands what he ordered, that you can deliver what the client ordered and that your billings are timely and invoices accurately meet your client's requirements for prompt payment.