The human touch

With all the talk on how the world is fast being digitised, it is understandable that we can get a little nervous when we hear of automated business management. But technology does not have to be a threat to us. In fact, it can be our closest ally, and although the fear that it could replace our jobs is unfounded, advanced business technology has and will continue to change the way we work.

In February 2019, Research and Markets published a report detailing how companies are buying business automation technology at a rapid rate. In the Contract Management sphere, the global Contract Management software market was valued at US$ 1.1 billion in 2018 and is expected to reach US$ 2.4 billion by 2024.

Digitisation, automation and changing global trade dynamics

Companies cannot afford to ignore the importance of using digital technology in Contract Management.

But how will this change the role of the Contract Manager?

In 2014, IACCM published an article titled ‘The Role of a Contract Manager’. “Automation increasingly replaces people in the performance of mundane or administrative contract management tasks. It also supports a growing wave of improved management and performance data, enabling contracts professionals to anticipate problems and manage, rather than administer, contracts.”  But not all obligations can be dealt with by an application.

With the advent of powerful Contract Management solutions, the role of a Contract Manager has shifted from being administrative to being more strategic, with the decisions they make affecting the entire business. Processes like seamless workflow, guaranteed compliance and cross-department integration add another dimension to Contract Management efficiency, processes that were hard to achieve before these platforms were introduced.

New skills required

With mundane admin tasks being taken care of by software, Contract Managers need to be more highly skilled and trained, to make tactical business decisions. They will need technical skills, interpretative skills, management skills and good business sense. More than just managing a department, Contract Managers will be called upon to give guidance and training on contractual matters that affect overall business performance.

Another item Contract Managers need in their bag of skills is an understanding of laws and regulations around contracts as authorities become more and more vigilant. As sustainability and ethical considerations are now sitting in the forefront of corporate and government concerns, Contract and Procurement Managers must be up-to-date on the latest laws and best practices in this vital area.

It’s still about relationships

Perhaps the most important skill that remains is “people skills”. You will never outgrow the need for personal interaction in business. Humans are social beings and conduct business with people, not computers.

Business automation rules can manage workflow, payments, missed deadlines, etc. but they will never be a substitute for a good Supplier-Contract Manager relationship. Collaboration with suppliers and contractors, as well as work integration within a company, will always continue to add value. Things like trust and personal judgment go a long way in building a prosperous organisation.

Another aspect, conflict resolution, may be aided by an electronic trail, but in the end raw data cannot repair a business deal. You still need human understanding around thoughts and feelings when “reading” a person.

Negotiations and evaluating contracts

Even if a Contract Management system greatly helps a tender or contract awarding process, a human being is the one who needs to make the final evaluation, underpinned by an understanding of the market and company culture. Negotiations are a person-to-person process at which a good Contract Manager should excel.

Plenty of data, but someone needs to make a decision

Contract Management solutions usually come equipped with data analytical tools for generating reports, and most allow integration with other departments, such as Finance. While this does help substantially when looking at the bigger picture, and although these reporting tools are extremely useful, ultimately someone has to look at the stats and make a strategic decision. It takes creative thinking and interpretation skills to spot trends and chart the best course. Contract Managers have moved into a new territory and top management needs to take recommendations from these experts in their field.

When things go wrong

Contract Managers are taking on greater responsibility and having a greater influence, but along with greater responsibility comes greater accountability. Technology is helpful, but where does the buck ultimately stop? When problems arise, as they will, a Contract Manager needs to be a problem solver who looks for solutions and not someone or something to blame.

In all areas of business, technology is a tool. In the end, it is how that tool is applied that will make the difference.

By Jeannie De Vynck