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Contract Management that drives ROI
Session #15186 June 9, 2015
Interact 2015 Las Vegas, Nevada
Healthcare Industry User Group - Interact
June 2015
Speaker Information Jens Brown Director Huron Consulting Group [email protected]
Jason Moebius Managing Director Huron Consulting Group [email protected]
Healthcare Industry User Group - Interact June 2015
Huron & Oracle
Huron is an Oracle Platinum partner and works closely with all levels of Oracle to provide guidance on how to optimize applications for clients.
We are particularly proud of the benefits this relationship provides to our clients and our role as a test partner for the latest PeopleSoft release.
Healthcare Industry User Group - Interact June 2015
Agenda/Contents
Importance of Contract Management
Top Factors Driving Enterprises to Focus Resources on Contract Management
Steps to Success Establishing contract management goals Business process reengineering Build the right organization model Establishing formal contract management practices Develop standardized and automated contract creation
methods Defining and quantifying ROI
Healthcare Industry User Group - Interact June 2015
Importance of Contract Management
These are not your parent’s contracts anymore – contract management is continually evolving
Taking a strategic view of contract management promotes collaboration between organizations and partners
Finalizing the contract is just the first step – the value added steps usually happen after the agreement is finalized
Technology, is an enabler and only one piece of the puzzle
Healthcare Industry User Group - Interact June 2015
Industry perspectives
Current and Planned Actions around Contract Management
Industry perspectives
Areas Within Contract Management Enterprises Intend to Automate
Top Factors Driving Contract Management
Healthcare Industry User Group - Interact June 2015
Author
Execute
A number of factors are impacting your organization’s ability to effectively manage contracts…
Top Factors Driving Contract Management
Healthcare Industry User Group - Interact June 2015
Author
Execute
Challenging to establish and leverage one set of templates
Previous language, and preferred and fall back positions are often one-offs
A common repository is rare
Top Factors Driving Contract Management
Healthcare Industry User Group - Interact June 2015
Author
Execute
Incomplete record of activities and history
Inefficiencies with department level contracts
Lack of visibility to existing contracts
Top Factors Driving Contract Management
Healthcare Industry User Group - Interact June 2015
Author
Execute
Gaps in standard and risk based approval
Routing, approval, and exception based review opportunities are lacking
All or nothing approach
Top Factors Driving Contract Management
Healthcare Industry User Group - Interact June 2015
Author
Execute
Execution of agreements is sufficient, however true enablement of the contract is challenged
Often there are gaps with the proper ‘customers’ in your organization having access
Top Factors Driving Contract Management
Healthcare Industry User Group - Interact June 2015
Author
Execute
Distributed management of contracts by departments, whose core competence is not in sourcing / contracting.
Gaps in enabling technologies to use and monitor duration and performance
Top Factors Driving Contract Management
Healthcare Industry User Group - Interact June 2015
Author
Execute
Visibility of spend on contracts is inconsistent
Data gaps make of a dearth of data for future negotiation efforts
Contract Management Goals
• Repository of Standardized Contract Templates • Monitored Contract Deviations during authoring
and execution • Electronic Drafting, Workflow, Authorization • Data Retention and Integration • Searchable Contract Repository • Milestone Notification
Steps to Success
Ok, so what are those steps to success?
Healthcare Industry User Group - Interact June 2015
For starters…
Contract Management is a JOURNEY not a GO-LIVE
Healthcare Industry User Group - Interact June 2015
Step #1
Establish Contract Management Goals Break your goals into short and long term
Map your contract management process to identify opportunities for improvement
Be creative – find opportunities to incent innovation from your business partners
Be transformative
Healthcare Industry User Group - Interact June 2015
Step #2
Healthcare Industry User Group - Interact June 2015
Business Process Reengineering Make the investment to consolidate contract data
repositories
Define the meta-data you want to capture within your contracts and vet the data requirements with key stakeholders
Identify low risk contracts/processes for automation to allow resources to focus on high risk contracts
Step #3
Build the Right Organization Model Create new performance goals and objectives of
contract administration staff
Integrate contract management goals
Review and analyze the stakeholders in your organization
Establish and curate internal partners
Calibrate and shift positions to best leverage category, compliance and transaction skills
Healthcare Industry User Group - Interact
June 2015
Step #4
Establish Formal Contract Management Practices Identify the criteria that will be used to evaluate
performance of the contracted parties Clearly articulate how proposed changes to the
contract will be evaluated Ensure that contracts are actionable by the right
audience / customer, via: Items, catalogs, punchout content, marketplaces
Ordering instructions
Buying and Paying Guides
Ongoing Compliance monitoring
Healthcare Industry User Group - Interact
June 2015
Step #5
Develop Standardized and Automated Contract Creation Methods Configure your systems to capture the meta-data
identified as critical to your contracting process
Standardize contract language across your organization
Consider which of your processes will benefit from an integrated contract management system
Healthcare Industry User Group - Interact June 2015
Questions?
Healthcare Industry User Group - Interact June 2015
