Improving Contract Management: manage the deal not the database 1

The guys at Selectica have some great points but to make expensive enterprise software work it’s important to work a system and not to work the software:

  1. Don’t try and put all your contractual information in one single database at once.  Not only do individuals have different ways and systems (what I call the e-Hub of someone’s daily life) from which they manage their data they may also run into legal issues around probity and confidentiality (by cross-contaminating case management with archival material).  Businesses do not need to invest in costly customisation but do need to strike a financial balance between customisation and counter-intuitive vendor processes.  One neat tool is to create  a visual model of the deal (its structures, functions and concepts) and provide hyperlinks to the various file systems.  This removes the need to develop a common taxonomy as workers now have a visual reference point (rather than a word) for their own understanding.
  2. With process automation it is critical to ensure that the business doesn’t  codefy its culture.  This will only calcify bottlenecks.  A firm needs to make sure that it re-engineers its CLM process before it creates a workflow from it.  Remove non-tasks and automate simple clerical work and approvals.
  3. The business also needs to make sure that experts are not only notified but they are also edified  and contextualised.  When pushing workflows out to experts, such as in-house counsel, outside counsel etc then these people must have a clear view of the dependent components of the deal’s architecture.  Businesses can speed this process and reduce its costs by linking their own systems to online legal databases such as Thomson Reuters (Westlaw AU, FirstPoint), Lexis Nexis or CCH.

In summ, good contract management needs a highly cross-functional and multi-disciplinary approach if it is not only to be successful but also if it isn’t going to add additional cost and friction to business operations.  Enterprise products such as Selectica’s are a great start but customers must be careful to make sure that the software supports their own system otherwise they will spend all their money and time working the software.

The Social Enterprise: what will business 2.0 look like? Reply

social-enterprise

If Andrew McAfee‘s book “Enterprise 2.0: New Collaborative Tools for your Organization’s Toughest Challenges” is to be believed then:

“We are on the cusp of a management revolution that is likely to be as profound and unsettling as the one that gave birth to the modern industrial age. Driven by the emergence of powerful new collaborative technologies, this transformation will radically reshape the nature of work, the boundaries of the enterprise, and the responsibilities of business leaders.”

Most pundits believe that Enterprise 2.0 is the full adoption of Web 2.o by an organisation.  In the next few years, therefore, we will see:

  • Cloud technologies and better enterprise application security enable bring-your-own-device and with it the greater fragmentation of organisational information.
  • Greater transparency of organisational work through social media leaks (i.e. people advertising their work and mistakes on the internet)
  • The decomposition of many more business processes into micro-tasks (much of which can be outsourced or contracted out).
  • The improvement of distributed working practices enabled by better collaboration tools, devices and connectivity.
  • Increased pace of business through improved self-governance and, in turn, empowered by better oversight (from GRC and finance software to more pervasive CRM implementations).
  • Shorter time-to-market cycles driven by improved idea generation and organisational creativity (so called – ‘ideation’).

So, is Enterprise 2.0 the social enterprise?  Are the benefits of Enterprise 2.0 merely social?  Simply a more hectic work schedule enabled by greater ease of using mobile devices and tighter communities of practice?

McKinsey Social Enterprise

A 2010 survey by McKinsey & Company found that most executives do believe that this is the sum total of Enterprise 2.0 benefits.  Most simply believe that (i) knowledge flow and management will improve.  Many believe that (ii)  their marketing channels will be greatly improved whilst only a few believe that (iii)  revenue or margins will increase in the networked enterprise.

If this is the dawn of the new enterprise then why do so many large businesses find it difficult even to implement Microsoft SharePoint?

The most likely truth is that this is not the dawn of Enterprise 2.0.  We are probably not on the cusp of a grand new age of information work.  Our businesses are unlikely to change significantly, although the hype will be re-sold by IT vendors for some time. One only has to hearken back to the ’80’s to remember to cries of the ‘paperless office’ to realise the low probability of Enterprise 2.0 materialising.

Whether it will be Enterprise 2.0 is debatable but we are entering the age of  The Social Entreprise.  It has ushered in a new age of commercial culture but it will unlikely herald a paradigm shift in commercial structures.  The truth is that human networks and communities operate in parallel to corporate reality.  Networks are how humans interact  – they are not how humans are paid.  Ask anyone who has ever been through or performed a cost reduction exercise.  In short, emerging social software platforms (ESSPs) are fun and sexy but the do not currently affect operations in most businesses.  Emerging social software platforms will make a difference internally when they affect cost structures and not just when they show up in sales figures.  This means that ESSPs need to be able to track and apportion innovation; they need to actively manage workflow (not just passive engines); they need to engage dynamically in governance and highlight good corporate participation and collaboration.   Only once these elements are incorporated into scales of remuneration and talent sourcing will both the enterprise and the workers benefit.

Maybe then we can move to Enterprise 3.0.