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Over the last 2 years ago my team and I have engaged with countless large enterprises, fast-growing unicorns, government agencies and more. We have interacted with Sales leaders, Legal leaders, Procurement, Legal & Sales Ops and, most often, the AGCs of Commercial who oversee almost all the buy and sell side contracts any company does. In all of our conversations, we always ask them how they make legal negotiation decisions and if they utilize a playbook.
Their answers are eye-opening:
Almost the entire market is dependent upon lawyers and their teams making every legal decision in a negotiation based on a playbook that is either not fully up to date or one that doesn’t exist at all! That is scary to hear particularly as it leads to the next natural question: Do you know all your negotiated positions and how they differ from your standard?
Here is their answer in a very simple pie chart.
That’s right. Uniformly, they have no idea.
Whether it’s well established, sophisticated enterprises or companies in hyper growth mode that have not truly matured their legal functions, yet the answer is still the same. To be fair, that’s not exactly true. Bigger companies tend to have layers of approval levels which help ensure any outliers are few and far between (and only for good reason), but, at what cost?
The fact is that every company has a playbook. It’s inherent in what they do every day. Any company that negotiates contracts already has the necessary data to avoid the dilemma of an unrecognized or outdated playbook.. Every signed contract is a reflection of a company’s legal decisioning process. All the data is sitting right there, and it should be analyzed and used. The good news is that software can get a company started right away and help companies avoid adding countless hours of menial, mind-numbing work to figure out all the answers.
The beauty of starting with the data is that through AI and analytics one can reverse engineer what a company is actually doing and ultimately arrive at an functioning and current playbook.
Why is that helpful?
You get to see all your negotiated positions and how often you go there. You get to see what friction points there are in the process that, if removed, would significantly speed up the closing of deals and time to revenue. And you get to make a choice whether you want to continue making legal decisions in this empowered way or remain as you were.
The benefits of opting in are significant. Going forward, every contract that gets executed will get scored and flagged for negotiated positions. Companies will finally know exactly what they’re agreeing to and won't need to be so reliant on the personal knowledge of which only a few team members are privileged. Instead, from legal to sales, it will be right in front of everyone’s eyes.
So, what’s in your playbook? If you are interested in reverse engineering your executed contracts to find out, let us know. We know a thing or two about this and the best part is, so will you in just a few hours time.
Derek Schueren
Derek is the CEO and co-founder of Akorda, where he is working to bring the market together to transform how businesses contract. Previously, he founded Recommind, a big data analytics company where he worked with Global 2000 clients, global law firms, and technology partners in the areas of eDiscovery and Information Access.
