Contracting needs to be customer-centric, technology-friendly and process-conscious to succeed in the current tech age.
Customer-centric
Customer-centric contracts are ones which are simple to read, understand and use, and provided as part of a simple, clear process to convert a prospect into a raving fan!
We all know the frustrations (as a consumer) of poor processes such as clunky online interfaces, tiny small print and/or SHOUTY CAPITALS which we have to scan in a miniature pop-up window, and the bully’s approach of sign or else. We rarely get offered a clear simple set of terms early; an opportunity to read, query and negotiate; and a copy to refer back to.
What can you do to make your contracts more customer-centric?
Your contracts should be simpler to avoid cognitive overload and so become clear, user-friendly interfaces – this also has the side benefit of helping with frictionless contracting. Personally, I am also a big fan of contracts enhancing trust (check out my three questions to audit your own terms).
Barriers: One of the barriers to this approach lies with contract writers in the legal profession. Instead of using their wealth of experience to act as guardians of simplicity, they are more often (inadvertent) creators of complexity.
Another barrier is the contracting strategy. Does it prioritize legal functionality – how the contract will behave in the event of a dispute – over business functionality – how the contract will behave in everyday use? If the focus is on legal enforcement, contracting will never be customer-centric or user-friendly.
Tech-friendly
Technology (through its engineers) has a tendency to over-engineer solutions. So instead of creating contract content and processes which are just enough, we end up with just in case… aka the kitchen sink.
Techno-contracting and/or digital contracting are not a panacea. Whilst the Covid years drove a massive adoption of some new processes, globally we are not equally ready for techno-contracting.
To avoid over-engineering the solution, we need to assess what we have, decide what we need, simplify what are do, optimise our existing systems before we invest in new technology. Answer these 10 questions to see if you are ready for digital contracting.
Barriers: When considering adopting new technology, each company will have concerns relating to a lack of skills, knowledge and expertise, issues with affordability, as well emotional issues to overcome. That’s before you begin to sift through the thousands of technology options, from a simple e-signature platform to contract lifecycle automation.
You need to treat the adoption of new tech platforms as a change management project to ensure it gets widespread adoption and effective use. Don’t undermine its ROI by a haphazard approach to its users. Ensure your tech is user-friendly and your contracting is tech-friendly.
Process-conscious
Finally, you need to be process-conscious. This applies to not just the process of creating, agreeing and signing a contract, but also the processes within the contract.
In terms of getting into contract, you should consider your strategy and focus on your processes to simplify your contracting and seamlessly schmooze your prospects. Check how you score against these three aspects to see if your contract process is customer-centric and simple.
In terms of the processes within the contract, we need processes that are clear and effective. In my view, excellent processes to manage change and smooth payment are critical.
Barriers: in UK construction we are stuck in a cycle of poor process. The incorrect use of processes is a major driver of contractual disputes. Be conscious that processes ought to be easy to find, understand, and follow if they are to be effective. Be conscious that some processes are suitable for automation (especially where there are binary, yes/no decisions) but others (especially where based on subjective opinions) are not.
What should you do?
To improve contracting in the tech age, you need to take a more nuanced approach, rather than simply slapping on shiny new software.
At least, take the audits noted above to see if your contract contents are customer-centric, to review your current contract process and check if you’re ready for new tech.
Simplify, optimise then digitise.
