A couple of months ago, SI ran a short series on Why You Should Not Build Your Own e-Sourcing System, which also included pieces on Why You Should Not Build Your Own Spend Analysis, Why You Should Not Build Your Own e-Negotiation Platform, and Why You Should Not Build Your Own Decision Optimization because he heard that a
few public sector organizations have this crazy idea that they can build their own and that it can, somehow, compete with best-of-breed solutions on the market today.
As per that series, this is not the case.
And even though SI has said in the past not to put too much emphasis on traditional, first generation, contract management solutions compared to analysis and optimization when the organization is seeking efficiency and cost savings, because most first generation contract management solutions looked like they were built by a high school student in Microsoft Access (and offered no more functionality than such a solution would contain), this doesn’t mean you should build your own either.
First of all, newer contract management systems go beyond simple document management functionality, and, thus, contain significant functionality that cannot be built by a high school student with Microsoft Access.
Second, most users want a Microsoft Word experience for authoring or versioning, regardless of whether or not there is a better way, so you will have to spend countless hours on a seamless Word integration, and Microsoft integration is no piece of cake.
Third, you will be wasting a lot of time and money re-inventing the wheel that has already been reinvented about a dozen time. Talk about a big waste of (public) money!
Consider the core absolutes of contract management that everyone can agree on.
1. Authoring & Versioning
As we just said, everyone, and especially everyone in Legal, wants Microsoft Word authoring & versioning, so no matter what you do, this integration will be essential. And most CM vendors have this, so why reinvent the wheel?
Most people think this is a core part of contract management, and while it is not, since not all jurisdictions recognize e-Signatures and not all companies will allow them, but if they are jurisdictionally accepted, or even mandated, this is core. However, implementing a secure e-Signature (which is not the same as a digital signature by the way, see this piece over on Spend Matters that was co-authored by the doctor for clarification) is not easy, and will require some serious development chops on your staff. Plus, how will you get it adopted and proved when there are about 40 global providers (even though the top 4 dominate most of the market)?
3. Document Management, Search & Discovery
There might be a few dozen free open-source content management systems, but that doesn’t mean you can re-purpose them as good contract management systems. First of all, contract management requires the management of contracts, amendments, schedules, work orders and related insurance certificates, regulatory approvals, and documentary deliverables. These all have to be related, indexed, cross-correlated, and chronologically ordered when a user is looking for current prices, terms, or schedules or prices, terms, or schedules when a work order was submitted. Secondly, meta-data will never be complete so full text search on various document, and image, formats will also be required along with seamless integration with meta data search. This is a fair amount of coding, which has already been perfected in a number of contract management systems.
4. Alerts & Reporting
Contract Management requires the accomplishment of necessary tasks on a scheduled basis, which often only happens when people are reminded. That’s why alerts are necessary. And status updates across contracts often require reports, as well as updates on all active contracts against a supplier, spend against a contract, etc. Across the organization, dozens of different reports will probably be required. Do you really want to waste countless hours developing dozens of reports with dozens of variations to please everyone when a number of packages not only contain a full library to start from and a report builder to alter existing and create new reports? Hopefully not!
Plus, today’s next generation contract management solutions, which do a lot more than initial contract management solutions did last decade, often cost less than their predecessors? So why waste what could amount to millions rebuilding a shoddier version of the wheel?
For more information on what next generation contract management systems can do, please refer to the ongoing series on CLM by the doctor, the maverick, and the prophet over on Spend Matters Pro (membership required):