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Jira for Contract Mangement

Wikipedia defines a contract as

“A contract is a legally binding agreement which recognizes and governs the rights and duties of the parties to the agreement.”

In simpler terms, it is the cornerstone of any interaction between two or more business entities. It is therefore startling that such a critical part of business interaction is still run using archaic methods.

 

Problems

Most of the contract negotiation and agreement is done over table or corporate email using bulky documents. This leads to a myriad of problems, with far-reaching consequences.

Running a complicated negotiation process on e-mail and documents as attachments is not a recipe for success.

 

Implications

Ambiguity

Without a central repository for all negotiation discussions and points of agreement, the final contract has a lot of undocumented inferences. These turn into flashpoints between the parties, when they are revealed at a later date.

Change management

Given the multitude of threads that run during the contract negotiation, it’s difficult to track all the changes to the document. This makes it easy to miss a point of negotiation. Certain criteria important to a minority partner might also get lost. Though some level of change can be traced in the document, it's insufficient to cover all the requirements and is not foolproof.

Privacy

A document is not the best way to share a contract during negotiation. Certain sections of the document might be sensitive and not exposed to all the parties at the negotiation stage. The only solution available is to have multiple copies of a document floating around in emails.

This leads to more confusion and doesn’t guarantee security.

Workflow

Though email is a robust platform for interpersonal communication, it is very inefficient as a tool to manage complex workflow. Without a process controlled by a workflow, it is a nightmare to manage consensus and track the progress of the negotiation. 

This leads to very long iterations on each point of negotiation, which is aggravated by the ambiguity already inherent to the process.

 

Solution

So, what is the solution to this mess? The following are the basic tenets of an effective contract management process.

Atomic Requirements

Till the contract is not broken down as an atomic requirement, it is not manageable. All negotiations should occur on these atomic requirements. If scope and execution are discussed based on requirements, it makes the whole process deterministic. An overall scope can, therefore, be defined as the total of the scopes of all the individual requirements.

Robust Workflow

The acceptance and change in each atomic requirement need to be controlled by a workflow decided beforehand between the parties involved in the contract negotiation. Without a workflow, ambiguity is the status of the negotiation and status of the contract cannot be controlled.

Documented Negotiations

All discussions on an atomic requirement need to be stored and easily accessible from the contract. This helps in creating a knowledge source and helps conflict resolution at a later stage.

Audit Log

An audit log of all the changes that have taken place also helps in the negotiation, as states discarded earlier are not reevaluated. This speeds up the negotiation process.

 

Solution Implementation

We believe a contract process run on an extensible project management platform like Atlassian Jira is the solution. 

 

Why Jira?

Atlassian Jira is a powerful project management software easily extensible using plugins to manage anything under the sun. It has issue tracking, workflow and security built-in. It has a vibrant community and large acceptance in the business world.

Along with JIRA, Atlassian Confluence is the yin to Jira yang. It provides a framework to create, collaborate and share documents. It is augmented by its integration with Jira.

 

4 comments

This is a good article.

Can we have one use case to better represent the scenario ? 

What type of issue types do you think would we be making use of ?

I can imagine a simple workflow - but I cannot think of any issue type fitting a Contract Management , maybe because I never worked with a Contract Management Group :p .

DPK_J Community Leader Nov 22, 2019

We have three issue types,

  1. Contract
  2. Requirement
  3. Negotiations

When I go through a Contract, I create a new issue of Contract type, and add details of party and expected cost to it.

And later I divide, Contract into multiple atomic set of requirement that can be used for negotiations.

Nice article, can be useful for people using JIRA for Contract management.

This app may help on that. Some of the features are related to link contracts and services to worklogs and future features will add custom notifications:

https://marketplace.atlassian.com/apps/1221714/contractspro-contract-manager-for-jira?hosting=server&tab=overview

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