Legal, finance, and procurement are the backbone of a healthy company. Without them, money, contracts, and tech — 3 essentials for any business — are all at risk. Business growth will inevitably be stunted when they aren’t aligned and lack collaborative workflows for shared processes.
To ensure the company advances innovative solutions while maintaining a healthy risk level, legal, finance, and procurement must be on the same page about processes and priorities. For example, who would be responsible for reviewing and approving a third-party contract, and what role does each department play when there is a new regulation to comply with?
Partnering on critical issues like these will allow each function to coordinate efforts while focusing on its core competencies. Here are some workflows legal can partner with procurement and finance on.
Negotiating Vendor Contracts
When it comes to buying new tech or starting a new vendor partnership, both legal and procurement care about getting the best deal at the right terms. For procurement, this means ensuring that the price is right; for legal, it’s about ensuring the contract protects the company from liability.
Using Contract Lifecycle Management (CLM), legal and procurement can set up a workflow for vendor contracts that allows each function to focus on what they’re experts in. Legal can create templates with pre-approved language, assign responsible parties at each stage of the contract process, and streamline negotiation all in one place. Likewise, procurement can do their due diligence to vet a vendor and get the best value possible without focusing on contract language.
Generate Accurate Forecasts
Visibility into the business's income and expenses is critical to maintaining healthy cash flow and runway to keep the business in operation. As a result, accurate forecasts and ROI projections for tech investments are essential to a company’s financial wellness.
Finance and legal can leverage the power of a CLM solution to align on forecasting. Finance can use CLM data to study deal trends while also integrating their tools to compare data and map business outlook. With CLM, legal can generate reports that support finance in making data-driven business decisions.
Comply with Regulations
Compliance is moving from out of the shadows of reactivity and into the spotlight as proactive measures businesses can take to protect themselves and gain a competitive advantage. Non-compliance is costly — financially and reputationally — so it’s in every business’s best interest to ensure that legal, finance, and procurement are aligned on regulation compliance.
CLM software can help these teams align with the compliance function. For example, while legal researches regulation requirements and bake compliance into their contracts, finance, and procurement can ensure that their contracts and other processes comply with regulations and collaborate with legal when workarounds are needed.
Takeaways
Legal, compliance, and finance are the road if the business is the vehicle. When they collaborate to fix processes, align on goals, and mitigate risk, the company is empowered to drive the business forward. See how CLM can help your teams collaborate better. Request a demo of LinkSquares today.
