Outsourcing contract administration can have many benefits for businesses—as can outsourcing contract negotiation. For companies with a large volume of contracts, the right outside help can be the difference between staying two steps ahead of risk or falling out of compliance. When choosing a managed legal services provider for your contract needs, business leaders that can leverage a full team with contract negotiation lawyers and operational legal professionals can expect better efficiency all around.
Below, learn the differences between contract administration and negotiation and how utilizing a fixed-fee law firm for your contract needs can support internal counsel and legal operations functions to ensure incoming or outgoing contracts are best managed to promote compliance.
What is Contract Administration?
Much like the behind-the-scenes strategies for your favorite sports team, contract administration is the background process of managing contracts from inception to completion. It involves ensuring that all parties to a contract understand their obligations. Contract administration is an important part of the overall legal operations function because it helps legal contracts to be correctly executed—it’s not your quarterback, it’s the strategist up in the box who sees everything from the big picture to the tiny details.
Legal operations professionals performing contract administration play a critical role in managing the legal contracts that a company enters into. From working closely with internal stakeholders, such as procurement, sales, and finance teams, to external parties, such as vendors and suppliers, they ensure that all contracts are properly managed to help organizations streamline contract processing, reduce the workloads of lawyers, and importantly, avoid costly legal disputes.
Why do Companies Outsource Contract Negotiation?
Outsourcing contract negotiation support can be a smart strategy for organizations looking to streamline their operations, reduce costs, and mitigate legal risk. By working with experienced professionals, such as those at a concierge law firm, businesses can ensure that their contracts are properly negotiated and managed, enabling them to focus on their core business activities.
Where your usual coaches (ahem, in-house lawyers) may have too much on their plate, an outside expert (or experts) can dedicate special attention to helping your team make the smartest game-time decisions—just like outsourcing your contract negotiations for your business to a trusted legal partner.
Outsourced contract negotiation support can enable access to an entire team of experienced professionals who have extensive knowledge of contracts and the legal and regulatory landscape—rather than the limited expertise of an individual in-house counsel lawyer. Working with outsourced legal teams also gives businesses a cost-effective alternative to hiring a full-time lawyer since it eliminates the need for organizations to provide benefits or pay for overhead expenses associated with an in-house employee.
If you outsource to a provider with a dedicated commercial contract services practice, such as with a fixed-fee concierge law firm, they can often negotiate contracts much more efficiently than in-house staff because they specifically know what to look out for. Additionally, they can leverage knowledge from numerous past negotiations and are dedicated to helping you achieve your business objectives. Outsourcing also can grant businesses support from a deeper bench of expertise and experiences for a fraction of the cost—with stronger insights and guidance into complex contractual issues for more informed decisions to avoid mistakes.
How Should Contract Administration and Negotiation Act in Tandem?
Legal works best as a team sport. If you’re relying on one or two lawyers with no support to hold it all together, as many growth companies are, you might be sacrificing a more efficient and effective model that can help your business achieve better results—especially when it comes to contracts.
For overworked legal teams searching for additional support, calling in a managed legal service provider, such as a fixed-fee law firm, is an obtainable way to add some much-needed help to your roster—for less cost than replacing your quarterback, or in this case, adding an in-house lawyer to your bench. The right outsourced contract negotiation lawyers paired with contract administration professionals can help your company with contract overflow to protect your business and avoid risks.
Adding outsourced negotiation legal professionals with contract administration support to your internal legal team can also evolve how your business handles contracts. The contracts administration function can help establish and implement the systems and processes to efficiently manage the full lifecycle of contracts in your organization while the contract lawyers can effectively draft, review, negotiate, and help your company avoid risk.
Together, an outsourced contract element can help your organization with a multitude of contract-based tasks, including contract execution, contract management, contract compliance, contract amendments, contract termination, contract interpretation, contract analysis, contract enforcement, and more.
3 Signs Your Business Needs Contract Assistance
Just like a football team without a good defensive line, many in-house legal teams are swamped while also doing more with less. From long-term strategic work to issues that pop up each day, chances are contracts are one area where this department could use a boost.
Sign 1: Overwhelming workload
If your legal department is experiencing a significant increase in the number of contracts they are responsible for drafting, reviewing, and negotiating is one of the easiest to spot signs that they need assistance. An overwhelming workload can lead to errors, missed deadlines, and increased risk, which can ultimately be costly for your organization.
Sign 2: Inconsistent quality
If there are inconsistencies in the quality of the contracts being produced or reviewed, it can indicate that your legal department is stretched too thin. Mistakes or omissions in legal contracts can have serious consequences, including lawsuits and financial losses, so it is important to ensure that contracts are accurate and comprehensive.
Sign 3: Lack of expertise
You wouldn’t put your kicker in as a defensive lineman. If your legal department lacks the necessary expertise to handle a particular type of contract, it may be a signal that they need assistance. For example, if the legal department is not familiar with the intricacies of managing vendor contracts, they may struggle to negotiate agreements effectively. Bringing in outside experts or contracting with a managed legal services provider can help ensure that your organization’s legal needs are met.
Outsourcing your contract administration and negotiation does not mean that your in-house legal department is failing at its job but rather means your business is strategically giving them more bandwidth to focus on the high-value tasks they enjoy. Utilizing a fixed-fee concierge law firm for contracts can help relieve your “starters” for some well-deserved rest and is a great way to add the support your in-house team needs—without the expense of hiring internally.
modCounsel: Your Powerplay Move for Contracts
Whether you’re trying to avoid an offside kick or get as many contracts as possible signed, sealed, and delivered, the right team on your bench can be a game-changer. At modCounsel, we’ve brought together a team of deeply experienced lawyers and legal professionals to help growth companies navigate the complexities of doing business. mC IO Contracts brings contract negotiation and administration together to help deliver your legal teams the credibility and efficiency they need to help your business achieve results. Combining the power of AI with the knowledge and experience of our team, we offer 24-hour contract review cycles and a fixed-fee model at the level your organization needs to scale.
Level up your contract game
Contracts are an essential part of business—so don’t let an important detail fall through the cracks. Reach out today to learn how modCounsel and mC IO Contracts can benefit your business.
References/Footnotes:
Gutterman, Alex S. Thomson Reuters: “Top ten steps for effective contract management.”
