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Should Lawyers Become Contract Managers?

October 14, 2009

Today I attended the 1st European Proactive Law Symposium, organized by the IACCM Proactive Think Tank in partnership with the ICN Business School in Nancy, France.

Among a host of interesting topics and papers, there was a panel discussion featuring academics from several Law schools that addressed “Proactive Contract Management as an Evolving Academic Discipline”. Based on wide agreement that contract management is an important business discipline, in need of a common language and established techniques, the panel discussed whether contract managers should be lawyers and / or whether contract management should be incorporated into legal training.

There was agreement that lawyers would benefit from the inclusion of contract management content in law school programs. It was felt that holistic case studies would assist the development of wider skills. “Today’s programs are rule-based and testing is based on those rules. It is a deductive discipline and the belief is that wisdom and judgment will come from on-the-job experience,” observed Tom Barton, a professor at California Western School of Law. He went on to explain that case studies from the world of contract management could assist in developing wisdom and also teach lawyers in areas such as gathering and analyzing information, coordinating ‘teamed’ resources, active listenting skills and greater behavioral understanding.

There was wide consensus that contract management will increasingly be an attractive path for some lawyers, but that it is not necesssary to be a lawyer. Indeed, the cross-disciplinary nature of contract management was emphasized as one of the reasons why it is so difficult to build academic programs for this community. However, all the academics present believe that it is important to develop contract management as a discipline in its own right, as well as making it an element of other programs – for example in law, finance or marketing.

In responding to this enthusiasm from the academic community, I commented that we must work together to build executive understanding of the importance of this role. While dedicated undergraduate and business school programs will be welcomed, uptake will be limited unless students are confident that the discipline offers a career path. However, we already have initiatives under way with several universities and business schools to offer internationally applicable programs for the contracts community.

We also discussed how content would be developed and I suggested that we should utilize the existing, practitioner- developed body of knowledge that is managed through IACCM as a base, and then have academics build from that syllabus to include more refined techniques and methodologies that would bring greater consistency and value to the contract manager’s output. One critical aspect of this is that everyone involved in contracting must have improved understanding of the economic outcomes of decisions. Many contract issues are resolved by functional owners who have little understanding of the potential market impacts. Many decisions have interdependencies with other terms and conditions; contracting must become more holistic and disciplined so that it can offer increased value and innovation.

  1. Steve Schwarz permalink

    Interesting discussions but I believe that the wording used is quite general (broad). As we all know there are a number of different law disciplines: Would I agree that a Criminal Lawyer should be recognised as a Contract Management professional – No; Would I suggest that a Commercial Lawyer could become a Contracts Manager – Yes. The approach taken in my workplace is perhaps the best I’ve seen: There is strong collaboration between the Law fraternity and the Commercial Management team in Contracts Management. My role is as Senior Commercial Manager (also responsible for Contracts Management) but I do not provide legal interpretation (despite the fact that I hold a Commercial Law degree); only Counsel is able to do this. However, there is often spirited debate between Counsel and myself over law issues and we generally recognise a consensus of opinion (or highlight a difference) when responding to the Executive. Given my experiences here, perhaps Contracts Management is not inherent in an individual but is, instead, a functional activity within an organisation. Just a few thoughts.

  2. Karen permalink

    Great perspective from Steve. His experience mirrors my own.

    Dare I say it, there’s probably a ‘snobbery’ obstacle in pushing for contract management to become an integral part of legal training. The legal profession tends to hold a deeply traditional, entrenched view of what a lawyer ought to do. I dare say so because, like Steve, my academic background is a legal one but I chose an alternative (diverse and deeply rewarding) career path, which led me into contract management.

    It is perhaps more realistic to accept that the contract management profession will continue to attract people from a legal background (as it will attract people from other educational backgrounds who bring different, but equally relevant skills) and to focus on ensuring appropriate training (pre- and post-grad) for those who actively choose it as a career. Of course, the inclusion of contract management content in relevant pre-grad courses would most likely encourage more people to make that choice!

  3. Most of the corporates recruit lawyers and non lawyers as well, for Contract Management Team. However,we can find a contingencies for non lawyers while dealing with the life cycle of contracts. Where a Commercial Lawyer can handle this with ease. A Lawyer have a ability to interpret the clauses; on the base of his domain knowledge. What I believe is a contract management is to become an Integral part of Legal Training; so that the Law schools can train the students with basic CM guidelines.

  4. Ellen permalink

    My two cents – I believe both lawyers and non-lawyers have an important role in Contracts Management. I am not a lawyer and have been negotiating contracts for 10 years. When I started on this career path, my training came from Financial and Business Risk aspects, but I was also required to understand and negotiate the legal requirements. About 5 years ago a trend in my industry was to move the Contracts Department under the Legal Departments – which is where I sit currently. I am the only person in my department without a JD and who, in addition to negotiating legal parameters, understands financial risks, operational risks and can interpret cash flow analyses. I have a high respect for the lawyers in my group when it comes to protecting the legal risk of a contract, but they rely much heavier on other departments (Finance and Operations)for the scope, budget and payment schedule to be correct – and you should see the look on their faces when I start discussing currency exchange risk! 🙂 I guess the bottom line is if a Contracts Management course is going to be introduced in law programs/training it needs to be focused on more than just the legal risk within contract management.

  5. Peter P. Weidenbruch III, JD, MBA permalink

    Im my opinion, commercial attorneys make excellent contract managers, and can make a salary comparable to other attorneys in the company, which is an important consideration. My strong preference is to work with business teams, preparing strategic alliances and go to market strategies, developing air-tight contracts and statements of work. In summary, I think that the legal skills (drafting, editing, interpreting and negotiating) are probably the best foundation for contract management that can be had. I much prefer this area of practice that general corporate work, litigation or legal research. When I started my career as a contract manager and had to bring all my work to the attorneys to get their “sign-off”, it didn’t take me long to figure out that I could do what they were doing and make much more money doing so. I became a CPCM, went to law school at night while working full time to achieve this objective and have been involved in every aspect of procurement, legal and contracts along the way and genuinely love doing this type of commercial management work while also enjoying the title and salary of a commercial attorney. My company recognizes the importance of putting the right skill set into the role and, I think has a strong preference for lawyers with a commercial background. Being able to intergate into the business team and not being percieved as a “deal killer” is in an of itself a real skill. So, I would say that attorneys, with the proper discipline and ego control, make great contract managers. I’d love to see any kind of training at the undergraduate, graduate or law school level to develop these skills. I’m glad that we have organizations such as this, NCMA, and IACCM to provide the education and certification to effectively and efficiently learn the discipline and master the processes and procedures and become an integral part of growing the company and protecting it from risk.

  6. I tend to agree with Steve and Karen above, contract management is a combination of legal knowledge as well as technical experience and/or background.
    I am working for a French company as snr. Contract manager on a large PFI hospital contract (construction). In France the QS profession (more British orientated) does not exist. In the construction industry a QS is specifically trained to deal with contracts as well as financial aspects of a contract)
    The title “Contract Manager” can be very confusing and I believe misleading if you focus purely on the law aspect. In my perspective, “contract management” is in fact commercial management.
    It is important to develop contract management and commercial management as a discipline in its own right. This profession is not purely legal and not purely finance. What is important is the combination between a legal and financial mindset that supports production teams or sales teams in order to be profitable and minimise risk.

  7. Tony Mackey permalink

    There are universities and colleges that offer degree programs in commercial and federal government contracts management. I am most familiar with the Masters Programs offered by the partnership of ESI International/George Washington University. Others include the Defense Acquisition University, and the National Contracts Management Association, (which offers several levels of professional certifications in Government contracts management equivalent to degree levels).

    Best regards,

    Tony Mackey

    • Tony, you are of course right that there are programs within the US, especially related to Federal acquisition. But obviously these are of limited use or relevance to an international audience and, with all due respect, most are not suited to the field of commercial contracting as it is now evolving. IACCM’s origins owe much to the absence of training and development programs that could be used by major international corporations. We certainly welcome and support the US providers who are addressing the needs of an emerging ‘profession’, but our mission demands that we push for more rigorous programs that also offer international support and recognition.

  8. Most companies rely on lawyers/in house counsel to negotiate contracts. If you are a contracts manager (not a lawyer) and are facing off against this person, they could be in breach of ethical rules around speaking to a representative on a matter without appropriate representation? Had anyone encountered this?

    • Yes this question arises periodically. It is a fairly ridiculous interpretation of ethical rules and is more typically an attempt to argue that lawyers can only talk to lawyers, thereby entrenching ‘the profession’. In itself, scarcely ethical!

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