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Turning Problems To Opportunities

June 27, 2008

Many professionals in legal, procurement or contracts groups know only too well those repetitive problems that just won’t go away. In fact, much of our work involves protecting against the risks that those ‘problems’ would otherwise generate.

But sometimes it is good to sit back and wonder whether it is true that there really is no other solution, or that the alternatives would prove unacceptable.

The ‘green’ revolution is daily throwing up examples that suggest the problems may often be in our minds rather than in reality. A recent example appeared in The Economist, which described an initiative by UK retailer Marks & Spencer to build a new, environmentally-friendly factory in Sri Lanka.

The “eco-factory” began as a branding experiment, but turned into an economic success. No air conditioning; natural light; hydro-and solar-power; a turf roof. Energy costs alone are 40% lower than comparable ‘traditional factories. And the goods it produces – ‘ethical’ lingerie – are no more expensive than their eco-unfriendly competitors.

Behind this story there was imagination – a group pf people who challenged assumptions and found practical – and superior – answers. It would be interesting to know the make-up of the team that developed this concept and oversaw its realization.

So what about some of our ‘insoluble’ or ‘risky’ problems, such as those terms and conditions that always demand negotiation and to which ‘there is no alternative’?

Are we the barrier to innovation?

  1. At my former company (I was the solo general counsel), if a customer asked for X in contract negotiations, we would consult the appropriate business-side execs to see if X, or some version thereof, could become our standard practice. If so, we added X, in a version we knew we could support, to our standard contract form. In effect, we treated customer requests as “product development” opportunities, with the “product” being our contract form, which we had to “sell” just as much as we did our software. We consciously decided to take this approach because we didn’t want to spend legal- and sales-rep time negotiating T&Cs that likely would never affect us operationally.

    As time went on, we found customers’ lawyers singing the praises of our contract form as the best they’d ever seen. For example, one customer lawyer said, when I read your contract, I wondered whether someone had already negotiated it for us, because it had everything we typically ask for; another said, I told my business guys that if your software is as good as your contract, we’re buying a really great product. That was an enormous help in getting deals closed — especially during the end-of-quarter rush.

Trackbacks & Pingbacks

  1. Contract negotiation requests are product-development opportunities | Drafter's Choice

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