Prioritizing Contract Reports With Respect to Your Legal Team Size

Unlocking the full potential of contract management requires a strategic approach that goes beyond just signing agreements. One way to find areas of improvement in your process is to generate and analyze contract reports. 

But which contract reports you should be focusing on has a lot to do with your team size. In this blog post, we will explore exactly that.

“Track how many contracts have I negotiated? How much money have I saved? How much legal risk have I managed? How many regulatory audits have we responded to? And how much money have we spent on outside counsel?”

~ Gitanjali Pinto Faleiro, General Counsel, Company Secretary & CCO at Greenhill & Co.
Navigating the C-Suite as a GC

Prioritizing contract reports for small legal teams (1–5 members)

Small legal teams can efficiently manage their contract portfolio, reduce risks, and optimize their resources for better overall performance once you focus on creating the following reports. 

#1 Overview of contract status and upcoming milestones

For small legal teams, having a clear overview of the contract status and upcoming milestones is crucial to stay on top of their contract management responsibilities. 

This report should provide a snapshot of all active contracts, their key details, and important dates. It helps the team to:

• Identify contracts at different stages: The report should highlight contracts at various stages of the lifecycle, such as those in the negotiation phase, awaiting approval, or nearing expiration

• Track key dates: Important contract dates, such as renewal or termination deadlines will enable your team to proactively address contract obligations and avoid potential risks associated with missed deadlines

• Facilitate time management: With a clear overview of contract statuses and milestones, small legal teams can better allocate their time and resources to prioritize urgent tasks

• Facilitate collaboration: Sharing this report with other stakeholders, such as business teams or management, enables better coordination and ensures everyone is aware of contract status

#2 Compliance status and potential risk areas

“While it doesn’t always get the love it deserves, a robust compliance function is an important part of risk-reduction at companies of any size. As such, in-house lawyers should get behind the creation of a compliance group if there isn’t one or enhance the existing one whether it sits in the legal department or not.”

~ Sterling Miller, CEO and Senior Counsel, Hilgers Graben PLLC
Ten Things: Building a Strong Compliance Department

Compliance and risk management are crucial aspects of contract management for small legal teams. The report focusing on compliance and risk areas will enable your team to:

• Monitor contractual obligations: Track whether all parties involved are adhering to the terms and conditions of the contract, ensuring that obligations are met

• Identify non-compliance issues: Flag any instances of non-compliance to address potential risks promptly. This includes identifying contract breaches or lapses in adherence to legal and regulatory requirements

• Mitigate legal risks: Identifying potential risk areas in contracts allows the team to take preventive measures and reduce the likelihood of legal disputes or financial liabilities

• Ensure accountability: Holding all parties accountable for their contractual commitments ensures the smooth execution of agreements and fosters a culture of compliance

• Support audits and reporting: A comprehensive compliance report aids in audits and regulatory reporting, streamlining the process for small legal teams with limited resources

Also read: What is Contract Compliance? The Ultimate Guide

#3 Financial impact and budgetary considerations

Managing finances is critical for small legal teams, and a report focusing on the financial impact of contracts helps in making informed decisions.

• Understand financial obligations: Assess the financial commitments associated with each contract, including payments, fees, and penalties

• Budget allocation: Analyze the impact of contract-related expenses on the overall legal budget and allocate resources accordingly

• Identify cost-saving opportunities: Identifying cost-saving opportunities, such as renegotiating contracts or consolidating vendors, helps small legal teams optimize their budget

• Forecasting and planning: Analyzing the financial impact of upcoming contracts helps the team plan for future expenses and avoid any potential financial strains

• Reporting to management: Presenting financial insights to management demonstrates the value of the legal team and justifies budgetary requirements for effective contract management

“Most C-Suite executives bank on data and hard metrics and not word-of-mouth. When you have certain metrics that shed light on how legal teams have contributed to growing the revenue stream of the company, it becomes easier for the GC to make business cases.”

~ Gitanjali Pinto Faleiro, General Counsel, Company Secretary & CCO at Greenhill & Co.
Navigating the C-Suite as a GC

The use of contract management software, like SpotDraft, with customizable reporting features can greatly facilitate the generation and monitoring of these essential reports, enhancing your team's efficiency and effectiveness in contract management.

SpotDraft helps you easily generate custom reports to identify trends and risks across your contract portfolio, track specific metrics, and gain insights into your contracts.

‍Also read: Understanding The Role of AI In Contract Analysis

Prioritizing contract reports for medium-sized legal teams (6–15 members)

Create these contract reports to enhance your contract management capabilities, make data-driven decisions, and proactively address potential risks and opportunities.

#1 Detailed contract performance analysis with KPIs

‍“If you are a commercial-driven business, the most important thing is to show how fast you are closing deals, what percent of deals are getting closed without any edits, how many litigations you are handling and how much you have saved, and how many templates have you created to support other business units. I don't think there is one key metric that defines the legal team — it really depends on the business.”

~ Chief Legal Officer in the Event Tech industry

Medium-sized legal teams handle a substantial number of contracts, making it essential to analyze contract performance thoroughly. This report should provide in-depth insights into contract performance metrics and Key Performance Indicators (KPIs). 

• Measure contract effectiveness: Assess how well contracts are performing in terms of meeting their intended objectives and delivering value to the organization

• Identify high-performing contracts: Identify contracts that are yielding positive results and contributing significantly to the organization's success

• Address underperforming contracts: Pinpoint contracts that are not meeting expectations and strategize on how to improve or terminate them if necessary

• Evaluate vendor and partner performance: Analyze the performance of vendors and partners involved in contracts to ensure they meet their obligations effectively

• Data-driven decision making: Use performance data and KPIs to make informed decisions about contract renewals, renegotiations, and overall contract strategy

Also read: 4 Crucial Contract Management KPIs to Track for Legal Success

#2 Contract portfolio overview and resource allocation

With a larger number of contracts, medium-sized legal teams need a comprehensive overview of their contract portfolio and the allocation of resources. This report facilitates effective resource management by enabling your team to:

• Categorize contracts: Group contracts based on their type, value, risk level, or other relevant criteria to gain a better understanding of the portfolio's composition

• Assess workload and distribution: Analyze the distribution of contracts among team members to ensure a balanced workload and optimize productivity

• Identify resource gaps: Identify areas where additional resources or specialized expertise may be needed to handle certain contracts effectively

• Optimize contract management processes: Evaluate existing contract management workflows to identify opportunities for process improvements and efficiency gains

• Align with business objectives: Ensure that the contract portfolio aligns with the organization's strategic goals and objectives

“While I have a seat at the table in all meetings with the upper management where key strategies are discussed, I encourage my team members to have 1:1 sessions with team leaders from other business units at their level. This way, they can contribute more to business operations, and the company will, consequently, be more legally compliant on a granular level.

By doing 1:1s with stakeholders, my team members not only get familiar with short-term and long-term business objectives but also take progressive steps toward accomplishing those objectives. The business grows, of course, but at the same time, my team members grow in confidence when they see how their contributions have bolstered the revenue stream of the company.”

~ Sandeep Chowdhury, Group GC, HCC Ltd.
Transforming the Legal Function at a Large Enterprise

#3 Risk assessments and mitigation strategies

Medium-sized legal teams deal with a diverse range of contracts, each carrying its own set of risks. This report focuses on assessing potential risks and developing mitigation strategies to safeguard the organization's interests.

• Conduct risk assessments: Identify and evaluate potential risks associated with each contract, such as legal, financial, operational, or reputational risks

• Prioritize risk mitigation: Prioritize risks based on their severity and develop strategies to mitigate or manage them effectively

• Monitor risk exposure: Regularly track and update risk assessments as contract conditions or external factors change

• Foster compliance and risk awareness: Promote a culture of compliance within the organization and ensure that all stakeholders are aware of potential risks and their responsibilities

• Review insurance coverage: Assess whether insurance coverage adequately addresses potential risks associated with specific contracts

Also read: How to Use Contract Analytics Software to Uncover Insights

Prioritizing contract reports for large legal teams (16+ members)

Working on these contract reports, large legal teams can effectively manage their extensive contract portfolios, optimize spending, and mitigate potential risks across diverse contracts.

#1 Contract portfolio health and performance metrics

Large legal teams manage a significant volume of contracts, often involving various departments and stakeholders. This report focuses on providing a comprehensive overview of the entire contract portfolio's health and performance metrics. 

• Monitor contract metrics: Track key metrics, such as the number of active contracts, contract values, and expiration dates, to assess the overall health of the portfolio

• Identify trends and patterns: Analyze data to identify trends and patterns in contract performance, allowing the team to make strategic decisions based on historical data

• Assess contract diversity: Evaluate the diversity of contract types and categories within the portfolio, identifying areas that may require additional attention or specialized expertise

• Measure contract performance: Utilize performance metrics to evaluate the success of contracts in achieving their intended objectives and delivering value to the organization

• Align with organizational goals: Ensure that the contract portfolio aligns with the organization's strategic goals and objectives, helping the legal team to focus on contracts that drive business priorities

Also read: How Contract Data Management Helps Maximize Legal Impact

#2 Legal spend analysis and cost-saving opportunities

Large legal teams often handle complex contracts with significant financial implications. This report centers on analyzing legal spend and identifying opportunities for cost-saving and optimization.

• Analyze legal expenses: Track and categorize legal expenses, including external counsel fees, court costs, and other legal-related expenditures

• Budget management: Monitor legal spending against the allocated budget and take proactive measures to avoid cost overruns

• Identify cost-saving opportunities: Identify areas where cost-saving opportunities exist, such as renegotiating vendor contracts or implementing alternative dispute resolution methods

• Optimize legal resource allocation: Evaluate the distribution of legal resources and allocate them strategically to high-impact contracts and cases

• Evaluate legal service providers: Assess the performance and cost-effectiveness of external legal service providers, fostering better vendor management.

#3 Compliance and risk management across diverse contracts

With a large number of diverse contracts, ensuring compliance and managing risks becomes increasingly complex. This report focuses on assessing compliance and risk exposure across all contracts to mitigate potential legal and financial challenges.

• Conduct compliance audits: Regularly review contracts to ensure adherence to legal and regulatory requirements, company policies, and industry standards

• Track contract obligations: Monitor whether all parties involved are meeting their contractual obligations, ensuring that contract terms are followed

• Identify high-risk contracts: Identify contracts with higher risk exposure and develop risk mitigation strategies to protect the organization's interests

• Ensure consistency in risk mitigation: Standardize risk management processes across diverse contracts to maintain consistency and efficiency

• Implement risk mitigation measures: Take proactive measures to mitigate identified risks and address potential issues before they escalate

The use of advanced contract management software with robust reporting capabilities empowers large teams to generate and leverage these reports for data-driven decision-making and strategic contract management.

Speaking of, SpotDraft helps you create custom reports for revenue forecasts, team performance, bandwidth allocation, and more with customizable dashboards.

Best practices for generating contract reports

Let’s explore a few best practices for generating contract reports that cater to the specific needs of legal teams, regardless of their size.

#1 Regularly reviewing and updating reporting processes

Contract management is dynamic, and the needs of legal teams can change over time. It is crucial to establish a culture of continuous improvement by regularly reviewing and updating reporting processes. This involves:

• Periodic assessments: Conduct regular assessments of existing contract reporting processes to identify areas for improvement or optimization
• Staying abreast of legal trends: Stay informed about changes in laws and regulations that may impact contract management and reporting requirements
• Evaluating data accuracy: Ensure the accuracy and reliability of data used for generating reports by implementing data validation and verification mechanisms
• Adapting to changing requirements: Adjust reporting processes to accommodate the evolving needs of the legal team and the organization

#2 Training team members on using reporting tools effectively

Generating accurate and insightful contract reports requires proficiency in utilizing reporting tools. Provide comprehensive training to team members on how to effectively use reporting software and tools, including:

• Reporting tool workshops: Conduct workshops and training sessions to familiarize team members with the reporting tools' features and functionalities
• Data visualization techniques: Train team members on data visualization techniques to present contract information in a clear and easily understandable format
• Custom report creation: Teach team members how to create custom reports tailored to specific needs or stakeholders
• Data security and confidentiality: Emphasize the importance of handling contract data securely and ensuring confidentiality during the reporting process

#3 Encouraging a data-driven culture within the legal team

Foster a data-driven culture within the legal team by promoting the use of data and analytics to inform decision-making and contract management strategies:

• Emphasize data-backed decisions: Encourage team members to base their decisions on data and insights derived from contract reports rather than intuition alone
• Set data goals: Establish data-driven goals for contract management, such as reducing contract cycle times or optimizing vendor relationships
• Share success stories: Highlight success stories where data-driven decision-making led to positive outcomes and improved contract management processes
• Collaborate with data teams: Collaborate with data analytics teams within the organization to leverage advanced data analysis tools and techniques for more sophisticated reporting

#4 Seeking feedback from stakeholders to improve reporting outputs

Solicit feedback from stakeholders, both internal and external, to continually improve the quality and relevance of contract reports:

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• Gather stakeholder input: Engage with key stakeholders to understand their specific reporting needs and preferences
• Tailor reports to stakeholder requirements: Customize reports to address the unique needs of different stakeholders, such as executives, legal counsel, or business teams
• Conduct surveys and interviews: Use surveys or interviews to gather feedback on the effectiveness of contract reports and identify areas for enhancement
• Periodic reporting review meetings: Schedule regular meetings with stakeholders to review contract reports, discuss insights, and gather feedback for improvement

Also read: 5 Key Contract Reports to Share for C-level Review

Effective contract management with foolproof reports

Tailoring contract reports according to the size of your legal team is a pivotal step towards optimizing contract management efficiency.

Remember, effective contract reporting isn't just about churning out data; it's about gaining valuable insights to make informed decisions, reduce risks, and drive better outcomes for your organization. Embrace a data-driven culture within your legal team, and regularly review and update your reporting processes to stay ahead in the ever-evolving legal landscape.

Leveraging advanced contract management tools like SpotDraft can be a game-changer, too. SpotDraft's robust reporting and analytics features cater to the diverse needs of legal teams, irrespective of their size. From tracking contract performance and compliance to streamlining resource allocation and risk management, SpotDraft's intuitive platform simplifies the process, saving time and resources.

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