Tropes around tech utopianism are attractive fictions that promise quick wins and deliver long-term pain, ultimately undermining our efforts at effective value storytelling (series recap, plus prior screeds against tech-fixated magical thinking here, here, and here)
A new bombshell lawsuit against a contract lifecycle management provider offers a stark reminder of the promise and peril of CLM—and therefore an unfortunate but instructive example of how tech-first solutioning can go terribly wrong.
Bad contracting processes have consequences. At the center of the complaint is a ~$5m contract for CLM services and tech. The plaintiff claim they terminated the contract early for alleged uncured breaches thereof and then mistakenly continued to make ~$1.7m in payments to defendant.
Isn’t it ironic (in the Alanis Morrissette sense of the word) that in a lawsuit centered around a disastrous effort to improve contract management a substantial percentage of the alleged damages are due to alleged failures in contract management.
The business value of better contracting is not in question. As discussed previously, a 20% improvement in contracting efficacy has, on average, 32x the business impact of cutting outside counsel spend by 20%. Tech has an important role to play. But tech should not be the star of the show, especially in the beginning.
When tech is not the primary problem (or the primary solution). The complaint begins its retelling in October 2019 when the defendant gave an in-person platform demonstration. In June 2020—seven months later “following a rigorous selection process”—the parties entered into the $5m contract only to terminate it in April 2021, ten months post execution. Suit was filed in November—more than two years after the demo (which is unlikely to have even been the beginning of this ill-fated journey).
Important for our purposes, the plaintiff specifically alleges only one tech-related misrepresentation giving rise to their claims (the ability to “apply a single contract amendment to multiple agreements simultaneously”). Beyond that, every issue raised in the complaint relates to the enormous amount of work required to properly implement CLM.
Characterized as inadequate in the complaint:
- Availability of key resources
- Status tracking
- Data mapping
- Data conversion
- Data migration
- Data validation
- Template harmonization
- Contract sorting
- Clause matching
The tech is not the central grievance. The gravamen of the complaint is the absence of expertise:
Continue Reading Tech-First Failures – Value Storytelling (#6)