Change Management in Contract Management Implementation
The decision to implement contract management software is one that an increasing number of enterprises are wisely making. The benefits of enterprise contract management software are numerous, and particularly with SaaS solutions, the upfront investment required to make the change will be quickly recouped by increased profitability throughout the life cycle of contracts.
But implementing contract management software is a significant change for employees involved in any aspect of contract management. Ultimately, contract management software will make their tasks easier and more fruitful, but upgrading to contract automation in the most efficient manner possible will nonetheless require some skillful change management by those responsible for guiding implementation.
Overcoming Natural Skepticism
According to CIO.com’s article, “Change Management: Understanding the Science of Change,” any type of corporate change will predictably be met in certain ways by different employees, and it’s crucial to understand these reactions and to guide change with them in mind.
“Roughly 20 percent to 30 percent of employees are change gluttons; often ambitious, they see change as a path to happiness and success,” the articles states. “Another 20 percent to 30 percent cannot view change as anything other than a threat to their jobs (and they may be right) and will resist at all costs. Finally, about 50 percent to 70 percent are skeptics – they may see some logic in the case for change but aren’t convinced it will benefit them personally.”
“It’s the 50 to 70 percent you need to focus on,” management consultant David Rock told CIO.com.
So how can an enterprise lead this middle group to embrace the change to contract management automation?
Letting Employees Discover the Value of the Change Themselves
It’s human nature to resist a change mandated from “on high.” If employees aren’t given their own opportunity to come to the conclusion that contract management software makes sense, then they will view the change as an “us versus them” process. As the CIO.com article explains, this isn’t a rational reaction – it’s instinctual.
However, if this skeptical middle group of employees is allowed to use their own reasoning skills to conclude that contract management software is a welcome change, they will overwhelmingly become enthusiastic supporters of the change, willing to do whatever it takes to make implementation successful.
Management guiding the change process can help achieve the necessary buy-in by leaving some open space in the implementation plan. Even if the action steps of the change are already formulated, provide employees the chance to decide at least some of the particulars on their own. The benefits of contract management software are apparent and the implementation steps are relatively straightforward – so from the top level down, most of the implementation will naturally be agreed upon.
But beyond facilitating buy-in, there’s also a strong likelihood that management will receive valuable input. Each enterprise is different and has unique needs, and involving all levels in the formulation of the implementation plan can yield pertinent insights that will promote the change and lead to greater benefits from it.
On the other hand, simply telling affected employees, “This is the way it’s going to be,” can engender costly resistance to the change among the skeptical 50 percent to 70 percent. This top-down approach jeopardizes successful implementation.
Moving from inefficient paper-based contract management to automation is not a hard sell to most people involved in the change. But it is a change – and as such should be approached with an awareness of change management. Affected employees need to be able to conclude in their own minds that the change is in their best interest.