Category Archives: contract management

Agiloft — For those with Lofty Ambitions for Contract Management Agility

Agiloft is another rare breed in the Supply Management space. It’s ancient (as it was founded in 1991, only a year after the first web browser was invented), it was founded to be a back-office B2B enterprise application (and their main offerings are service desk, workflow & business process management, and contract management), it’s debt-free, it has a large network of resellers, it has multiple global hosting locations (to support local privacy laws or government & military security requirements), and you can have it anyway you want: pure (low-cost) multi-tenant SaaS, classic ASP, or even on-premise with your choice of two different platforms (Windows or Linux). [Hint, choose the 2nd.]

Obviously, in this post we are going to focus on the contract management solution, as that is the most relevant to Supply Management, and the related BPM and Workflow elements they have in their Workflow and BPM solution to support it as well as their Asset Management capabilities. While the ability to use a single vendor for multiple “back office” B2B applications might be attractive to some organizations, our specialty here at Sourcing Innovation is Supply Management and Supply Technology Innovation, and that’s what we will cover.

The contract management solution supports contract creation, negotiation, approval and renewal. It contains a searchable central repository with double-byte language support and automatic audit trail for regulatory compliance, clause libraries, Word templates, and Word integration. In addition to Word integration, it also provides a complete API and and bi-directional pre-built integration with systems such as AD, SAML, Oauth, SSO, SalesForce, MS Exchange, DocuSign, QuickBooks, and Xero.

The contract creation is not only flexible, but so is the complex review and approval routings that can contain a combination of sequential, parallel, and conditional approvals. Agiloft’s ability to create and support complex, customizeable, business processes and workflows make complex creation and approval processes a snap. Furthermore, in addition to complete version history (and automatic redlining), it also supports a complete audit trail of those changes, built in OCR that can process attached image files, and fine-grained security that can control access by user group down to individual fields in a contract record.

It can easily be configured to support any industry and regulatory requirements that the organization has to support (or wants to support) by way of additional data capture, workflow modifications, mandatory checks and required approvals by appropriate risk management personnel. It can also be integrated tightly with asset management and each asset affected by the contract can be correlated with the contract, and each contract that references an asset can be correlated with the asset. This last point is particularly relevant as some assets can be shared across contract if they are only needed for short periods of time (such as excavators on construction projects).

However, as of now, any organization that has regulatory or compliance needs, requirements to track additional types of compliance, insurance, or audit documents has to define the requirements, create tables to track the necessary data and documents, define the relationships, create the monitoring tasks, create the notification templates, hook the notifications up to email, and so on. The wheel has to be re-created in each and every organization that needs to track a specific requirement. The platform needs the ability to capture and store common tasks, workflows, and components in a repository that can be accessed by any and all customers and included in individual instances as needed. Agiloft plans to release a community next year that will allow customers, consultancies, and anyone on the platform to export and share custom capabilities that they have created, and this is a good start, but it would really quicken start up time if this functionality was there.

That being said, the configurability of the solution (and the speed at which it can be configured by their services team) should not be overlooked. Consider the example of Enki(.co). Enki is a cloud services provider that was founded by the former NetSuite CIO and Director of Engineering. They spent 6 man-months customizing NetSuite for contract management, sales, and support, but never realized their vision. They eventually replaced NetSuite with Agiloft, and managed to customize it to their needs in 10 days, going live a week after that. In other words, the platform can be customized to the needs of most organization’s in a matter of weeks, but only by an experienced configurator. (However, once someone in the organization goes through about a week of training with Agiloft, they will learn to maintain and customize the platform at close to the same speed going forward.)

Agiloft is a great fit for those organizations that have some supply management capability (in front end strategic sourcing or back end procurement / procure to pay) but do not have good contract management and need a good CLM tool to serve as a foundation for their Supply Management processes. The ability to define the required contract lifecycle and sync with other platforms makes it a great central system for any organization that does not have, or cannot acquire, a fully integrated source to pay suite (as it can manage workflow across applications).

On the Fourth day of X-Mas (2016)

On the fourth day of X-Mas
my blogger gave to me:
some CLM Posts
some Best Practice Posts
some Trend Bashing Posts
and some ranting on stupidity …

Contract Lifecycle Management. It’s a mouthful. It sounds awfully boring. But if you do it poorly, you might as well just kiss 30% of your negotiated savings goodbye the minute you sign the contract. Poor execution against sourcing plans captured in contracts is the big reason why 30% to 40% of negotiated savings never materialize in an average organization so, if you want to win big, you have to manage the contract lifecycle right.

Why You Should NOT Build Your Own CLM … even though a high-school student with Microsoft Access can build a basic contract management system, a true contract lifecycle management system done right (and done right is the real caveat) takes a lot more work than you think …

Do You Have Your Platform and Process in Place? Be honest!

A series on CLM:

I: Do You Know What It Is?
II: Do You Know Where it Starts and Ends
III: Do You Know Where it Came From
IV: Neither Sourcing Nor Procurement Are Enough
V: Do You Know What The Must-Haves Are
VI: Do You Know What The Should-Haves Are
VII: Do You Know What The Nice-to-Haves Are?
VIII: Are You Ready for the Journey

The Strategic Category Management Lifecycle:

Getting it Right, Part I
Getting it Right, Part II
Getting it Right, Part III

Enterprise Contract Management … more than just an electronic filing cabinet!

Come back tomorrow for the fifth day of X-Mas.

For Most Organizations, Ain’t Nothing Wrong With Being White & Nerdy …

In a recent post over on Procurement World, the procurement dynamo asks if the Kraljic Matrix [is] Actually Becoming Obsolete? He notes that since Kraljic published his classic article 33 years ago, world trade has quadrupled, globalization has exploded, and Procurement is operating in a much faster, bolder, world than it was in 1983.
In this brave new world, Procurement has to manage ethical supply chains and practice good Corporate Social Responsibility, or its CPO could be personally convicted of criminal charges and end up behind bars. (While this is a great place for many sociopathic CEOs, it’s not where ethical and hard working CPOs deserve to be.)

the procurement dynamo notes that, in some ways, the Kraljic matrix still works well. The heart of the Kraljic matrix, segmentation into manageable buckets that can be addressed with consistent strategies, is still valid, but the degree of segmentation needs to be much deeper now than it used to be. However, even the concept of a 3-d Rubik’s cube doesn’t quite capture the level of segmentation required in today’s supply chain.

It used to be supply risk and financial risk was enough. Now there is information risk, sustainability risk, compliance risk, ethical risk. That’s significantly more than a cube can handle. (We’re at a six-dimensional hypercube, and we’re just starting.) That’s why we have to adopt Value Based Sourcing and replace TCO (Total Cost of Ownership) with TVM (Total Value Management), which is the root of all value models.

This is challenging, as the procurement dynamo points out, but not impossible, especially for the White & Nerdy. It doesn’t matter if they look like they are still in the 80’s, insist on riding segways down the hall, or shout blasphemies in Klingon while trying to solve the problem. As long as the problems get solved, which only the IQ and TQ-savvy white & nerdy can do, that’s the way forward.

The Corridor to Enterprise Contract Management

While there are a lot of vendors offering up contract management solutions, there are few vendors left offering pure-play contract management solutions. For example, even long-time contract specialist vendors like Selectica have acquired sourcing and procurement vendors (like Iasta and b-Pack in Selectica’s case, which changed it’s name to Determine). About the only pure-play contract vendors left Apttus, Corridor, Exari, and Novatus.

Among these few pure-play vendors left, Corridor Company occupies a relatively unique position in the enterprise software market with its deep visibility into their global buy-side and sell-side contracts with unique capabilities around obligation management, distributed reporting, and what they call counter-party management.

While not a well-known name in the Supply Management space, Corridor Company is a New England-based provider of a SaaS contract management solution that has been in business since 1998. Starting out as a services provider, Corridor Company, which has completed over 450 contract management projects (including dozens and dozens of projects for the largest global multi-nationals) to date, switched to a software provider in 2008 to better serve the increasing needs of their customer base and now serve over 40 global customers on their platform.

In addition to the unique capabilities highlighted above, Corridor has one of the deepest DocuSign integrations out there, integrates with major ERP platforms (including SAP, Oracle, and Dynamics) out of the box, integrates deeply with Sharepoint (that it is built on), and, unexpectedly integrates deeply with SalesForce.

While lots of solutions have shallow SalesForce integration, Corridor on the other hand, has a deep SalesForce integration. All data and meta data can be embedded in the salesforce application, with each Salesforce user having access only to the data they would in the platform, and, most importantly, the ability to punch into the relevant part of the Corridor platform (using single sign-in) to do contract research or maintainence.

Another strength of the platform is distributed reporting. Most contract management platforms have good, integrated, reporting capabilities with dozens (upon dozens) of built-in reports, but the capability is generally limited to canned reports or reporting capabilities which create one report for the filters, sent to one distribution list. But when you have a large global organization with multiple, distributed, contract management departments, dozens (or hundreds) of distributed contract management professionals, each needing a slew of similar reports on a daily basis, having to manually define hundreds of similar reports dozens of times is not only burdensome, but unmanageable when they have to be maintained over time. Thus, Corridor built the ability to define a meta-report and then filter out sub-reports targetted to each user who needs only a subset of the data (based upon their locale, department, account assignment, etc.). Each report type is only defined once, no matter how few, or many people need it and what subset of data they get access to.

There are more unique capabilities as well, and for a deeper dive, we recommend you check out the recent Pro coverage [membership required] on Corridor Company by the doctor and the prophet over on Spend Matters (Part I, Part II, and Part III), especially if you have deep contract management needs not met by an average module in an average Sourcing platform.

To “Term” or Not to “Term” … That is the Question

Today’s guest post is from Torey Guingrich, a Project Manager at Source One Management Services, who focuses on helping global companies drive greater value from their expenditures.

I sometimes hear clients say, “We are leaning towards Vendor ABC because they don’t make us sign a contract“. In most cases, Vendor ABC does have a contract (or something acting as an agreement such as a letter of authorization, etc.); it is just based on a month-to-month term with no termination penalties/liability. Some companies have a knee-jerk reaction to avoid contracts, but while there appears to be less risk in a “no-term” contract, there are risks and rewards for both “term” and “no-term” agreements. Part of the strategic sourcing process is educating stakeholders on the different consequences of contract components such as term. When evaluating what type of contract or what term to leverage for your next agreement, consider these different aspects before negotiating a shorter (or longer) term contract.

Availability of Supply and Criticality to the Business:

Consider the supply management strategy of the category you are working with and where the product/service lands on the axes of availability of supply and criticality to the business. Based on the classification of purchasing strategy for the product or service to be sourced, you can determine if that strategy is best supported by a long-term partnership or a shorter-term, more flexible agreement structure. For example, if you are working within a category that is scarce in the market and critical to your operation, a long term contract is necessary to guarantee supply. On the other hand, if the products you are sourcing are widely available and can easily be replaced, it may be in your best interest to forego a term agreement.

Pricing/Price Changes:

One of the reasons why many companies opt for longer term contracts is to gain deeper discounts and ensure negotiated pricing is held for a period of time. When entering a contract, pay attention to the language around pricing and the supplier’s ability to change that pricing. Month-to-month contracts typically give the supplier the opportunity to raise prices; if you are purchasing in a market with downward pricing pressure, ensure that language also allows price reductions based on the market. Having a short-term contract in a market under pricing pressure may prompt suppliers to reduce pricing to prevent you from moving to a competitor. Likewise, when a market is trending up in cost (whether it be from decreased competition, increased maintenance costs, etc.) it may be prudent to lock in pricing with a long term contract. Depending on the industry, suppliers may offer signing bonuses, rebates, or other incentives when you sign a long term contract; these should be in addition to more competitive pricing in the contract.


Month-to-month contracts can be very appealing because in theory they allow you to simply change to another vendor if you are unhappy with your incumbent. There are certainly plenty of goods or services where companies are able to be vendor agnostic, but there are other categories where the cost to change is substantial. Likely, changing suppliers will (and should) involve a sourcing activity, e.g. RFP or RFQ, and thorough review of other suppliers in the market. After a new supplier is chosen, the transition process can be a relatively simple for some products or services, e.g. ordering IT accessories from another reseller, but can get more complex for others, e.g. migrating network services to a new carrier. If you are unhappy with the current supplier and chose to change, you will still need to rely on them to some degree during the changeover period. Be sure to consider the ease of change before jumping into a short or no term agreement under the assumption that you can quickly switch suppliers if needed.


The name of the game in short-term or no term contracts in flexibility. Companies may elect to pay slightly higher pricing to have the flexibility to terminate services or purchasing whenever they see fit. This tends to surface when companies are considering technology changes; they have plans to migrate their services to a different technology or platform and the flexibility of a month-to-month contract allows them to change over as necessary without penalty. This is all well and good, but before entering a higher priced agreement or one that allows for pricing increases, consider your company’s track record on executing migration/change and truly exam the pricing risks that can come with flexibility. If the migration will be based on small, incremental change over time, it is likely you can still use a longer term agreement to your benefit. Also examine the reasons behind the company’s need for flexibility: if the concern is around certain SLAs or KPIs, you can try to add termination rights related to these performance levels and still operate under a term agreement.

As you contract for new and existing categories, don’t get stuck using a one-size-fits-all contracting pattern. Where changes occur in the market, category management strategy, or category roadmap, ensure that the contracts you put in place support those changes and allow your Procurement group to perform optimally.

Thanks, Torey.