KEY POINTS
- Part of being able to successfully measure your success as a contracts professional is benchmarking your performance against industry standards.
- Leverage existing benchmarking reports and other resources as a starting point.
- Communicate benchmarks and your performance against them effectively to your business colleagues – Link to download email templates at the end.
How do you define “success” when it comes to working with contracts? Are your standards up to par with everyone else’s in your industry or line of work? Where should you even begin to figure that out?
Start by benchmarking. Part of being able to successfully measure your success is benchmarking your performance against industry standards.
Benchmarking your performance allows you to track your progress, identify areas for improvement, and determine whether your performance is standard or non-standard.
In this article, I’ll share some ways you can benchmark your performance metrics with respect to your work with contracts and how to communicate those metrics effectively to your legal team members and other business colleagues to help them understand your success.
Benchmarking Resources
To benchmark your performance metrics, you first need to identify which metrics to measure.
Then, you’ll want to determine whether your performance is standard or non-standard by comparing your metrics to industry benchmarks. Here are a few benchmarking resources you can use to get started:
- Contracting Process – The World Commerce & Contracting (World CC) publishes regular surveys and reports on contract management benchmarks, which include metrics such as contract cycle time, contract value, and contract compliance. They also provides benchmarks for specific industries, such as tech, finance, and healthcare. Members can take the Capability Maturity Assessment which will benchmark your contracting process against standard contracting processes for ways to improve it.
- Contractual Terms – TermScout offers insights and benchmark data specific to the terms contained in a contract template and post-negotiation. TermScout has 1000+ Verified™ public contracts. You can upload a private contract for review and Verification™ by TermScout to see how your contract template compares to others.
- Legal Department Management – The Association of Corporate Counsel (ACC) offers a Law Department Management Benchmarking Survey which enables legal departments to compare their performance and efficiency against their peers.
Communicating Performance Metrics & Benchmarks
Once you have benchmarked your performance metrics, it’s crucial to communicate them effectively to your business colleagues either via an email or a meeting (or both). Here are some tips to help you communicate your performance metrics and related benchmarks more effectively.
- Use visuals. Charts and graphs can help illustrate your metrics and make them easier to understand. You don’t need to display every piece of data in your visual. Start with the main data points you want to highlight and use footnotes to explain the details.
- Provide context. Explain the benchmarks you used and why you chose them. Also, explain how the benchmarks may differ depending on the size of the company, industry, and complexity of contracts. Always cite your resources so that your audience can determine whether they want to rely on the data or dive deeper.
- Focus on the impact. Explain how your performance metrics impact the business and its stakeholders. For example, if you have reduced contract cycle time, explain how this benefits the sales team by enabling them to close deals faster.
- Be concise. Keep your communication concise and to the point. Avoid using technical jargon that may confuse or distract your audience.
Here are a few email templates to get you started. See you next month on the New to Contracts column, exclusively for Contract Nerds!
