Running Legal Like A Business - Ch. 18 - The Digital Playbook Advantage

In Ch. 18 of Running Legal Like A Business by Connie Brenton and Susan Lambreth, PLI Press, 2021, chapter authors Gary Sangha and Michael Ross of LexCheck, pick up where Andy Banquer left off in Ch. 17.  Their focus is the conversion of analog playbooks into digital AI-driven aids.

At the outset Sangha and Ross note that at times people do not follow the playbooks.  In my experience one also needs to encourage discipline in the playbook owners to keep the playbook updated and the teams using the playbook trained on current state, especially on teams experiencing turnover.

Sangha and Ross note that self-service tools help more junior legal staff, as well as procurement and sales representatives to initiate contracts, negotiate and make minor edits through pre-approved language options, while alerting subject matter experts when the modification exceeds a pre-determined threshold.  The end result of facilitated, if not fully self-service, contracts is "Business teams can move with greater agility, giving corporate attorneys the freedom to focus on more strategic tasks." 

This is absolutely true for working off of company paper.  When working off of counter-party paper, I have yet to see a #CLM tool that an attorney finds of real use in negotiation.  Many companies, however, require suppliers to work off of their paper and also have a number of standard sales agreements.  As such there is plenty of opportunity for contract analytics tools to reduce repetitive work. 

A number of tools, inc. LexCheck, will now redline an agreement against a playbook sample within a few minutes. Some can also monitor edits triggering notifications to legal or other business executives when those changes exceed the digital playbook's parameters.  

Sangha and Ross reflect on several persistent contract issues:

1. Negotiation escalations carry built-in lag time.  For more routine contracts, digital playbooks reduce lag time, not only by creating fallback positions that do not require review, but by focusing SME input on a few discreet paragraphs, allowing one contract to be reviewed by many SMEs in parallel without creating the need for reconciling edits. Senior attorneys can then focus more time on complex high value contracts.

2.  Risk Mitigation. "Interpretation and application of any playbook by multiple individuals will lead to variance and human error." Digital playbooks facilitate consistent application and facilitate escalation where needed.

At my former company when we consolidated contract management systems and adopted more consistent use of tool features, even with more limited AI capability at the time, we were able to build a scored clause library with key clauses having 100% 85%, and 70% options and each assigned to a subject matter expert (SME) either within legal or the  business.  For example, if a mark-up of a privacy clause failed to meet the 70% standard the compliance officer might receive a notification, whereas if a procurement quality standard was struck the product owner might receive the ping. 

An algorithm scored a handful of key clauses (up to 12) to arrive at a contract score.  Team leads received a monthly report of their team's contract scores.  Teams, or individual team members, that tended to give away the store were identified and redirected. The process also initiated coordination between sales and procurement to ensure suppliers were aligned with our company to meet commitments to our clients. Though given the complexity, a lot remained to be done on this front. 

As Sangha and Ross note, all of this takes substantial investment from SMEs to design the tool, but once it is in place those resources are freed to pursue the highest and best use of their time.  And I would argue that the upfront investment deserves prioritization and is a contender for the highest and best use of time in the short-term to break the cycle of being perpetually mired in wide ranging review.