Extreme Contract Simplification

• Posted by Geoffrey G. Gussis on February 15th, 2007


• Filed in Corporate/M&A, Law Department Management

David Munn has a post at his LegalTech.com blog
that should be of interest to all inhouse counsel who deal with
contracts on a daily basis.  He reports on an interview in a recent International Association for Contract and Commercial Management
program with two inhouse attorneys at Scottish & Newcastle, a UK
brewer.  According to the interview, these attorneys may have found the
holy grail of contract management:

"[T]hey
embarked on a radical reengineering initiative that has resulted in
transformation in the way many trading relationships are negotiated and
managed. Not only have the contracts themselves been dramatically
simplified and reduced in size, but other sacred cows have also been
sacrificed. For example, many relationships now operate without fixed
term; frequently there are no volume commitments; they have even
dispensed with service level agreements and liquidated damages.
 

 "The results? With several billion dollars of spend and revenue now under their new forms of agreement, they have observed:

• Growing collaboration between trading partners, with focus on maximizing value and performance
• Reduced contention and disputes
• 
  Shorter lead-times
• Legal viewed as a critical business partner and change-agent, involved early in strategic discussions and initiatives"

Head over to David’s blog to read more.