Looking for a good scare this Halloween? Forget about the ghost stories and scary movies. We're talking about real-life scenarios affecting the lives of sales people, managers, general counsel, and IT departments.
They can cause unnecessary psychological trauma to salespeople when quotas and sales goals aren't met. Plus, corporate lawyers can be stuck on the Nightmare on Risk Street if the proper protocols aren't set properly for contract reviews and approvals.
Grab a pillow to hide behind. Here are 5 contract management nightmares.
"The contract stories you are about to read are based on real events..."
1) The Ghost Contract
Sally had just sat down to work when she noticed a message in her inbox from a customer. It was in inquiry about renewing their contract – for which the renewal date was only days away. Her stomach dropped. With so many deals in motion, she had totally forgotten about this renewal. She needed to find the original agreement so she and the customer could revisit the terms and ensure they were still getting the best deal. She checked her shared drive, but nothing came up when she searched the customer name.
Sally couldn't remember the file name of the contract, so she dug into her email history with the customer to find the contract. Finally, she located the contract in an email string dating back when the contract was first negotiated. But was it the most up to date version of the contract? She contacted the legal department to see if they had the latest version. After days of searching, she found the original signed agreement. But it was too late.
2) The Redlining Zone
Larry had just begun negotiating a contract with a client. In the beginning, everything seemed to be running smooth. He started with a basic draft – and sent it along to the client lawyer for redlining. After some back and forth, both lawyers agreed the contract was ready to send for approvals.
While Larry's manager quickly approved the contract, on the client's side two more reviewers entered the process, requesting their own redlines. After more back and forth between more reviewers, the contract was sent for approval once more. This time, Larry's manager rejected the recent changes, asking to go back to some of the original language. But in all the back and forth – that language was no where to be found.
3) The Eternal Wait
Lucy was in the final stages of closing a big deal with a client. The contract had been generated and negotiated. She just needed to get the contract approved by her manager before getting it signed. The day before, her manager said he'd be travelling over the next few days and would have limited access to email, but the contract was so close to closing, she assumed her manager would be looking out for any news about the deal.
She emailed her manager with the contract attached, and waited. The next day she still hadn't head back. She sent another message to see if he had looked at the contract. Meanwhile, on a train, Lucy's manager was on his phone, trying to open the attached contract she had sent. He had no easy way to view the contract and grant approval. Then his phone died. They say Lucy still waits today, for her managers approval on that contract.
4) The Ancient Contract Chisel
John has just finished negotiating and approving a deal with a client– all he needed was the client's signature. He went ahead and sent the client the contract, requesting an electronic signature, with the expectation the deal would be signed the same day. John was surprised by the response.
Malachi – the point person with the client company – said they do not support electronic signatures. Instead, they needed to download and print the contract so it can be signed with a pen. Then, it would need to be scanned, uploaded and emailed back to him. Malachi warned that the signature process may take more than a day. At any other time of the year – John would have been ok with that. But it was the last day of the quarter – and his quota had already been missed.
5) Contract Clones
Jessica was in the process of negotiating a contract. Both her team and the client's side had multiple people redlining the contract, with changes being exchanged via email. Jessica was making a point to keep track of who had made edits to the contract and when. Finally, both sides appeared happy with the final contract, and it was ready to send for approvals. Jessica took the final contract from the email thread and sent it along to her boss for approval. When her boss responded, he seemed upset. The contract she had sent to him was not the final version of the contract and still contained annotations and edits. She then realized, every time the contract was edited and sent back, a new version of that contract had been created. Jessica had pulled the wrong contract to send to her boss.
Avoid Contract Nightmares
While these scenarios are common in the selling world, these nightmares can be avoided. More businesses are investing in contract management to get ahead of roadblocks and accelerate the contract process.
What's you're biggest contract nightmare? Click the button below that matches your contract challenge, and we'll show you how contract management can help.