As people in sales, we are expected to be the Swiss-Army knives of the organization. On one end - we are busy chasing and converting leads to deals, on the other - we are expected to understand customer needs and integrate them with business solutions.
It does not help that beyond prospecting, interacting, nurturing, and convincing, we are also expected to be responsible for creating and executing contracts, since - no deal is really ‘closed’, until the customer signs over the dotted line.
This brings us to a question as old as your unconverted lead -
Archaic contract processes in sales cycles are the unaddressed elephants in the room. We know of their existence as soon as we enter the contracting and negotiation stage, but so far, have done nothing about it.
To begin - there is a lack of ownership in the contracting processes. Sales folks lose visibility of the contracts as soon as they are sent to legal. Again, closing deals isn’t really the legal team’s KPI. This is the root of the consistent animosity between sales and legal. And why not, after all - “legal is where deals go to die.” Or is it?
Water cooler conversations between sales and legal at SpotDraft made something pretty clear - lack of transparency and ownership is as frustrating for the legal team as it is for us at sales.
Sales cannot add value to the process because we know very little about legal clauses. In turn, legal cannot redline deals faster because they have very little context of the customer’s needs and outlook. Add to that the fact that lawyers are paranoid (in varying degrees, and with good reason) about other teams messing up contracts.
The need of the hour, therefore, was to build a process that integrated co-ownership and flexibility without compromising on compliance standards or leaving room for errors. Something that gives us ease of usage and creates a bridge of trust between legal and sales.
So we went back to our drawing boards and came up with something that we call-
Realizing that (like it or not) the work and the fates of sales and legal are invariably tied together, we recalibrated our contracting processes. We fragmented the different ‘asks’ from both the teams into smaller parts and gave each other direct responsibilities in the process based on-
To reduce ambiguity over ownership, contract-cycles were halved and the responsibilities were divided between sales and legal.
The legal team took direct control over building and maintaining “plug-n-play contract templates” for the sales team. These contract templates were readily available in a unified contract management ecosystem. Since they were parameterized by the legal team - they also guarantee the same degree of transparency and protection, as the long-drawn manual process.
One of the most rudimentary examples are NDAs - arguably among the most frequently used contracts, piloting ahead of every agreement.
Once the legal team creates an NDA template and feeds it into our contract management system, details about the counterparty are automatically fetched from our sales tools and populated within the contract. Sales checks in the deal deliverables and ships it out to the counterparty for their signature.
The outcome - an arduous back and forth process is condensed into a “single click.”
Despite our best efforts, there will always be situations that require either team to suddenly jump in.
For example - a key client negotiates that some of the usual conditions won’t apply to their contracts. In such a case - your legal team has to be made aware of the clauses that would have to be removed from the contract template in this case. Alternatively, the sales team must also be aware of the clauses that would apply based on the client’s location, or the deal value.
The process of informing, waiting for changes, following-up, and the many (many) changes is tedious. Instead, we decided to merge the two workflows together so all the changes, alterations, and edits happen in a single interface - our contract management system (CMS).
By integrating our CMS with the CRM, we achieved seamless and automated data inflows. At no point do we have to manually fetch customer data while creating contracts anymore. This makes sales cycles faster and more transparent. In fact, any change in the contract at any point in time is tracked and logged in the system to provide greater accountability.
This shift to integrated contracting also helped us transform sales-customer service handoffs.
The CMS parses all contracts for the key details - e.g. deal value, renewal date, etc. - in seconds, and highlights them upfront. Whenever sales-customer success handoff happens, all terms of the agreement and any related information is immediately accessible.
Not only that, we have been able to nurture our recurring customers better, with 30% faster sales cycles, and a 3x growth in our lead conversion rates.
Contracts are never a direct sales team KPI. Despite being the only means to legitimize and enforce any sales deals. This is why considering contract management technology beyond the scope of your sales stack does more harm than good, especially since every sales professional knows that there is never ‘enough time.’
To save time, therefore, most sales teams have template contracts that are copied and pasted depending on the situation. These are not only inefficient but also dangerous. A small human error can lead to real dollar damages.
Instead, by leveraging our contract management software, our legal team prepares dynamic templates that automatically adjust depending on sales inputs. Depending on any change in deal deliverables (e.g. entity location, jurisdiction, deal value, etc.), clauses in the contract readjust themselves to fit the situation.
This way, we save both ourselves and the legal team a lot of time by bypassing the contract feedback loop and build sales agreements self-sufficiently.
By making our CMS the axis of our sales-cycle, we have managed to achieve greater control over the sales process, and minimize the scope for errors without having to put in the usual grind ourselves.
As sales professionals, we are often taught the importance of building relationships over just selling. Therefore, instead of reading “wins” as the aggregate number of new clients converted, we give a greater weightage to recurring clients - when counting our wins.
This is because the sales team here is also enabled to go beyond its pipeline and aid customer success.
Soon after a prospect signs on the agreement and becomes a client, the contract and all its details get directly added to our CRM. This makes knowledge transfer to the customer success team a lot more efficient. Since all key details are searchable when you need them the most, the customer success team can provide better, more informed support.
The integrated CMS also sets auto-reminders ahead of expiring contracts, making it a lot more easy to convert existing customers to recurring customers.
A sales team is an organization’s first point of business. At SpotDraft we embody that responsibility by testing our own boundaries and challenging convention. By breaking away from this notion that - contract management is exclusively a legal-tool we’ve accelerated our pipeline velocity, and made real impacts to the bottom-line.
For more ways to boost your sales pipeline and resolve your contract woes- let’s talk!