What is Agreement Management?

All work arises from agreements. The performance of every business is a direct result of its ability to execute agreements: small agreements and big agreements; agreements that are kept and those that are not. Lack of closure and commitment are the two primary reasons for inefficiencies in an organization. Successful organizations have a culture of keeping agreements. While there is an entire category of software dedicated to creating and administering legal contracts, the vast majority of agreements in the enterprise are less formal, more ambiguous, and are rarely managed, tracked or measured. In many cases these agreements are communicated by nothing more than a confusing thread of emails, phone conversations and meetings.

Since business is a network of agreements and all work arises from agreements, it follows that most problems in business are attributable to broken agreements. Businesses that are successful have a culture of keeping agreements. Even a small improvement in the agreement process will produce enormous benefits and ROI to the enterprise. Yet no technology is available to help organizations improve agreement creation and follow through. Current day compliance issues only compound the problem and create a fertile environment for AgreeNet.

AgreeNet is changing all that by providing customers and suppliers (in their broadest definitions) an easy and culturally acceptable way to create, negotiate, manage and measure agreements. AgreeNet provides an out of the box platform on which to conduct business and also allows specific vertical mission critical industry agreement applications to be built.  AgreeNet integrates tightly with all major email and groupware products, making the solution easy to use while minimizing cultural barriers. AgreeNet provides agreement management within the enterprise, between enterprises and between individuals, in the form of both enterprise software and as a managed web service.

A Supply Chain Example

Company “BigBlue” has a relationship with its supplier “CanDo Corporation” to manufacture and fulfill BigBlue’s laptop computers in North America for its eCommerce site. BigBlue’s marketing department decides to run a Fathers Day promotion on the site causing the VP of Manufacturing to email the Project Manager at CanDo to ask if her team can deliver an extra 6,000 units by a week from Friday and at the same unit price. CanDo’s Project Manager responds that they can either meet the Friday deadline for $2.50 more per unit, or can do it by the following Wednesday at the same unit price. The VP of Manufacturing accepts the latter counter offer and an agreement is made. The CanDo project manager then must create or modify several linked agreements in the supply chain to gain commitment for the new deliverables from upstream suppliers.

In today’s world, this negotiation would probably be carried out over the phone or via email. Misunderstandings could easily arise, and unraveling who said what can become an issue. While this is an extremely simple example, one can imagine that with more complex requests including changing specifications, the more likely it will be that expectations are set incorrectly and therefore not met. AgreeNet provides an easy to use framework to create and manage this agreement between customer and supplier and provides a permanent record of all interactions. Most importantly, it allows the parties to be proactive about anticipating and communicating changes and expectations thereby building trust in the business relationship. Additionally, AgreeNet can track and compare the performance of this and all other agreements made with any supplier or with related requests.

Not Limited to the Supply Chain

Of course the benefits of agreement management are not limited to the supply chain. In our roles in the enterprise we are all both customers and suppliers in many agreements every day. AgreeNet provides the framework inside the enterprise to change the culture of business to one of clear communications and commitments.

Why Can’t I Manage Agreements with email or task lists?

At first glance Agreement Management sounds simple and related, if not replaceable by email. In fact, there are key structural and cultural differences, not to mention a long list of critical missing features that make email and other forms of unstructured communication, by themselves, inappropriate for managing anything but the most trivial agreements. Agreement Management is a transactional application, requiring many of the same services used by financial, supply chain and other mission critical applications. At the enterprise level it requires rich security, user authentication and rights management, fault tolerance, archival, enterprise reporting, and application integration.