The hard work that comes before any discussion of technology

Chapter 5, Playbooks

The need for creating playbooks for templated contracts is a subject of much discussion. This is because playbooks are one of the ways in which contracting is simplified. But they can take many forms. Luckily, distinguishing and differentiating between the necessary types of playbooks is possible without creating too much complexity. Not only are they used to create standardization across a law department, but they also empower the business.

Playbooks educate, create consistency, and are an absolute requirement for any type of outsourcing contract review. I submit for your consideration that there are two basic types of playbooks: The Law Department Playbook and the Empowerment Guide.

The Law Department Playbook is a great way to share knowledge. It is perfect for educating and training new attorneys joining the in-house team. It is not uncommon for a lawyer to learn simply by diving in and just doing it. They don’t necessarily want to be thrown into the fire, but often there is no formal training in place that teaches how to handle contracts. Playbooks are also useful to those attorneys who are covering for others on leave or helping out when volumes increase.

Playbooks created for educational purposes are used to explain the rationale behind the positions for specific provisions, provide historical context, and perhaps even offer examples of fallback positions. They are a fluid and holistic explanation of what the department has decided for certain legal concepts in contracts. This is extremely helpful in speeding up how attorneys think about negotiating contracts.

Anytime legal departments talk about contracts, they talk about speed; it is a common theme. This is because the business places great value on speed. Playbooks are excellent at increasing speed. …

[discussing “stoplight approach,” where “fallback provisions are classified as red, yellow, and green,” and how playbooks avoid “forum shopping” by business units.]

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Empowerment Guides

When discussing various types of playbooks, it is easier and clearer to begin calling these documents by specific names. It doesn’t matter what they are called as long as you are clear and aligned on the purpose of the taxonomy you’ve chosen. At its core, a Law Department Playbook is a method of knowledge sharing and knowledge management. However, if the purpose of the playbook is for empowerment, then it’s an Empowerment Guide.

An Empowerment Guide doesn’t spend much time explaining the history, the why, or the purpose of the different contract provisions; it’s more about actionable items. The goal is to make contracting faster with less involvement from the legal department. The only way to get Legal less involved is to empower the business. …

I’m going to go out on a limb and assert most lawyers don’t want to spend their time chasing signatures. In fact, I have a strong opinion that no attorney should ever spend time chasing down signatures. These types of administrative steps are handy to hand off to the business.

[discussing Playbooks for Outsourcing Contract Review and Playbooks for Negotiating Third-Party Paper]

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Playbooks, like templates, take time to create. They also need to be written in plain language and thus be easy to read. They should be living documents you can modify to ensure they are up to date. The more you modify them, as you learn more throughout your negotiations, the more your playbooks will evolve.

Most importantly, actively use the playbooks, because the best way to learn what should be in your playbook is through data gathering.

Chapter 6, People

For ages, Legal has been accused of being the blocker; the group that slows down contracting and business; the ones to avoid, or else the contract may fall into a black hole, and other unpleasant categorizations. By the way, some of these descriptions come from companies with a healthy relationship between business and Legal. In fact, in many companies, the organization has great respect and appreciation for one another, but the frustration is there nevertheless.

The reason for the frustration is simple: Speed. The business wants to move at lightning speed, but legal review takes time. It simply does. Advancements in artificial intelligence are helping and adding significant efficiencies, especially for simple contract review, but to do a thorough job on complex agreements, it just takes time. In many cases, a lot of time. Compound that effort with high volume, and the problem becomes obvious.

In prior chapters, I reviewed the concept of simplifying contract templates and empowering the business to handle certain negotiations independently. I also laid the foundation for having a clear and strictly enforced policy about what Legal needs to review. So, this brings us back to the reviews that rightfully fall on the plate of the legal department. These contracts need legal review, and they need the trained eye of someone who knows contracts.

But who in Legal does the review is a question many departments still do not answer (or even ask). Those who have the luxury of being larger than a solo GC (aka a team of one) can choose if the attorney(s) should review contracts or if a paraprofessional can take a stab at the review. Perhaps it is an initial review. Perhaps it is some subset of contracts that can be reviewed by someone other than an attorney.

Skillsets: who should touch the contracts?

The healthiest approach to determining who should provide the legal review is to consider the skillsets needed, rather than titles or company roles. To comply with “practice of law” regulations, let’s assume all options we review here are to be performed under the direction and control of the General Counsel or other designated attorney in the legal department. Since we are trying to figure out who in Legal performs the review, we are not going to include the consideration of whether someone in the business should handle the contract negotiations independently, since that was covered in Chapter 5 on Playbooks.

With the premise that someone in Legal must review the contract, the options are:

  1. Lawyer or other professional
  2. Internal resource or external (contingent staff or law firm)
  3. Outsourced managed legal service provider

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Back to skillsets. It is important not to think about contracts as one homogenous lump of legal work. We all know that contracts vary in complexity, volume, and risk.

Legal must take the time to plot contracts on a matrix such as the one in Figure 6.1, so they can understand which contracts they want to tackle. I’m assuming they have already done such an exercise in conjunction with their policy creation, as described in Chapter 3. Once they have identified the quadrant, then they can ask the most important question: “Does a lawyer need to review this contract?”

[Discussing challenges of lawyer review in a small legal department with very limited bandwidth and evaluating pros and cons of internal versus external review; discussing potential of automated review of some contracts, with “more on that later in the technology chapter”; discussing system Bassli designed and implemented at Microsoft]

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Chapter 7, Process

Process is vital to improving contract lifecycle management. Of course, there is a lifecycle to contracting, because this is the one thing that grounds us: all contacts go through some form of a lifecycle. Something I tell lawyers, which they don’t like to hear, is that a lot of what we do is a process. In fact, almost everything we do in our day jobs is a process.

And lawyers don’t like to think of that, because it makes it sound like we’re somehow diminishing the art of lawyering, the complexity, the great brainy work we pride ourselves on. It is true: our work is complex, and we love analyzing really complicated topics and issues and providing guidance to the business. But there are recurring steps we take every day, and those recurring steps come together to form a process or the series of steps. Maybe they’re not even recurring as much as it’s simply a series of steps taken. …

In the legal field, there is a phenomenon I call the process stigma. Some attorneys see the practice of law as a unique and special craft; one that cannot be reduced to a process. Meanwhile, process is something associated with other disciplines—perhaps engineering or business operations.

By calling something a process, some attorneys think it makes their work less meaningful or perhaps less impactful. It also makes it seem like work that perhaps does not require intellectual aptitude. Obviously, that’s not true. While there is the craft of the practice of law that requires deep analysis and judgment, there are many aspects of it that are amenable to process review and optimization. It is important that attorneys are trained to identify those parts of their practice that can be improved and made more efficient.

The way to overcome process stigma is to demonstrate, with basic data and logical analysis, how certain functions of the attorneys’ day job can be broken down into various process steps and how some of the steps can be completed faster. While the practice of law is focused on the work that requires the unique expertise and training attorneys receive, it may not be immediately obvious how process fits in. …

[Discussing how processes are heavily embedded in the litigation and transactional contexts; discussing CLM technology]

Technology is important, but process is more important. (See the next chapter [on Technology], where we address the big questions about implementing a CLMS.)

[Reviewing the nuts and bolts of process mapping and the use of design thinking to improve and simplify a process.]

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Special Focus on Details of Legal’s Process

While the contract flows through different business departments, this handbook is written for the legal department. When designing process, consider the policy of the department with every decision. The policy was written in order to lighten the workload in Legal and reallocate responsibilities. Don’t fall back into over-functioning!

Once the mapping exercise has envisioned the process for which contracts should land in Legal, drill down into exactly what happens once it is clear that the contract must be sent to Legal.

Getting into specific details is worth the time spent. This is a part of the process that Legal controls 100% and can dictate. It is also the part of the process that requires attorneys to really test their risk tolerance.

Read Part IV (272).