June 30, 2011 Leave a comment
Recently, we had a successful Sopima Summer Launch ’11 event together with our customers and business partners. At the event, one of our top customers, Mr. Jukka Ilveskoski, Legal Counsel of an American-Finnish gaming company Digital Chocolate, shared his unique perspective on contract management with the audience. Digital Chocolate is doing well not just in the game industry – but also in contract management.
In the beginning of the speech he told us why contract management is so vital to their (Digital Chocolate) operations:
“Contracts should never be signed and then forgotten in the drawers and inboxes. Access to the contract data must be guaranteed to those to whom it concerns – and the continuity has to be guaranteed as well, regardless of the changes in personnel.”
‘Access & Continuity’ both are critical factors for an organization and feature extensively in the risk management strategy of organizations worldwide. He further illustrated his thoughts on the subject by sharing a refreshing analogy from the gaming industry. According to him, contracts actually define the product, just like a software license defines software in order for it to be termed as a product. An excellent point indeed, it is important for businesses to have a firm grip over information which binds them with their stakeholders.
The memory is short and people come and go
Continuing the discussion, Jukka Ilveskoski explained that “contract issues cannot be based only on the memory of the sales person or an attorney” as “the memory is short, and people come and go.”
Wise words from a man who knows about the contracting industry in and out. Although it may sound obvious to most of us but in reality these things are often overlooked in organizations of all sizes. Easily accessible contract information is worth much more than the sum of its parts, especially if the contract information is required by not just the legal professionals but also by other business managers in their day to day work.
To answer the question, “Why Contract Management is essential in their sector”. Jukka raised the following key points:
- Funding rounds / Due Diligence process – you’ll face these sooner or later.
- Besides, a prudently managed contract base saves time, money and reduces stress. So why not just do it?
- Easily available company documentation has a positive effect on the price/valuation. The missing contracts or information in them could make or break a deal. What seemed to be a harmless partner contract might just come and bite the company in all the wrong places.
During our interactions with our other customers we chanced upon a startling fact: Contracts stress the hell out of ordinary business people. They don’t understand them and they certainly don’t like them, but still have to use them. I think we at Sopima realized this quiet early and have since then worked tirelessly to create a solution which makes managing contracts easy, quick, and above all stress free!
We part with you for the summer with this interesting fact ‘A well-managed contract base raises the value of the company and has a positive effect on your organization’s bottom line.’
Thank you for this blog season! We’ll continue with contract management related posts in Sopima blog in August.
We wish you a very relaxing summer season!