Imagine logging in to Twitter to see that your company’s name is trending. While it would be great to feel excitement in this moment, it’s more likely that a feeling of panic might set in as the page loads. Your fingers are crossed that it’s for a good reason, because trending for a scandal is a nightmare for any business. The risk of reputational damage can be even worse than the financial loss, because once a scandal hits social media, it’s there for everyone to find.
The Dreaded Social Media Scandal
Of course, scandals on social media and the internet are not new. Microsoft, AOL, Google and Facebook have all faced their share of scrutiny. More often than not, these scandals begin with a breach of privacy. Could contract analysis have helped these companies avoid these crises?
Take the Cambridge Analytica Scandal, for example. While this particular incident dominated the news cycle for a major part of last year, it prompted businesses to reexamine their terms and conditions. Based on the terms that customers agreed upon, what data was the company allowed use and share? Were customers aware of this information?
In reality, a large portion of customers simply don’t read the terms and conditions when signing on to a new service. However, that doesn’t negate the importance of this information. It only takes one public complaint to start a ripple effect of customers reviewing the terms, so as a business, it’s vital to know what they include. However, this knowledge shouldn’t be limited to your legal team.
Contract Analysis for Marketing
For example, your marketing team may want to publicize a high profile client that’s just signed on to use your company’s services. Depending on the nature of the product or service, some companies may prevent this type of publicity entirely. Even promoting a logo on your website can lead to a cease-and-desist, or worse, a lawsuit. By using a contract analysis tool like LinkSquares, businesses can easily review and categorize contracts based on custom terms, so that teams know what agreements exist between your business and the customers in question.
In addition to marketing, working with third party vendors is another instance where contract analysis can be beneficial. In the Cambridge Analytica scandal, Facebook was responsible for how the data was used, since they agreed to share user data. Like Facebook, if a third party vendor mishandles customer data that you supplied to them, your business could be at risk. Without properly managing your company’s third party contracts, your company could be neglecting privacy regulations, along with unintentionally fostering mistrust among your customers.
How a Contract Analytics Tool Can Help
With an AI-based contract analysis tool like LinkSquares, companies can let the AI do the leg work of extracting and organizing the terms within these contracts. That way, your marketing team can be made aware of which customers they can promote on social media, and your sales team can stay informed of how they can utilize the current customer base. Like any contract, it’s vital to maintain proper records of the terms, so that your legal, finance and procurement teams are executing their requirements accordingly. By proactively managing your company’s contracts, you’ll both provide protection from scandals and create peace of mind.