A visual way to show your legal team what positions they should care about

It's the bit that AI won't do well. (Plus free whiteboard template + workshop recording)

I’m pretty confident AI will massively speed up the time it takes to create a mark-up (that’s what our company DraftPilot is trying to do).

But that’s only part of the work.

After the first mark-up is done, there’s usually a back-and-forth, calls with the other side, more mark-ups etc.

To improve ‘time-to-close’ and reduce frustration, the speed of mark-up is only one variable.

The positions matter

I’d say what’s even more important is what goes into the mark-up.

What positions are taken? There’s no point in taking really uncommercial extreme positions at lightening speed, if it still leads to a 3 month process to get the agreement signed.

So in short, lawyers should only negotiate what matters. Leave the rest alone.

When I started as a lawyer back in 2008, I never really gave my contract negotiation approach much thought. I worked at a large law firm and we pretty much pushed on everything.

We felt quite good about it too - ‘look at how diligent we are!’

But I now know: clients hate it.

The client’s goal isn’t to be entangled in legal negotiations. They want to do a deal!

Buy a product, service, company. Whatever. That’s their goal.

They just want to do it in a legally safe way without too much delay.

So the lawyer’s job is to limit their work to the riskiest bits. This is especially true for in-house lawyers.

𝗶.𝗲 𝗼𝗻𝗹𝘆 𝗳𝗼𝗰𝘂𝘀 𝗼𝗻:

✅  potential issues with a high cost if they go wrong, even if infrequent; and
✅  potential issues with a lower cost if they go wrong - but only if they are frequent!

Everything else should be left alone. It’s probably not worth delaying the deal over.

And again, even when using an AI tool to generate the mark-ups, that won’t materially avoid the delay.

The AI just saves you time in creating the mark-up, but if the mark-up is heavy, the other side will still need to spend more time chewing on all those positions.

But how to decide which is which?

💡 𝗦𝗼𝗹𝘂𝘁𝗶𝗼𝗻: 𝗥𝗶𝘀𝗸 𝗛𝗲𝗮𝘁𝗺𝗮𝗽

I’ve written about this before (including on LinkedIn last week), but because there was such interest I thought I’d share it here as well.

In short, I like to use the below heatmap template to solve this problem. You can fill it in together with your team in a quick workshop for each contract type.

Afterwards, you can document the output in a playbook + use it as a checklist for AI review tools like DraftPilot

(𝘚𝘪𝘥𝘦 𝘯𝘰𝘵𝘦: 𝘱𝘢𝘳𝘵𝘪𝘤𝘪𝘱𝘢𝘵𝘪𝘯𝘨 𝘪𝘯 𝘵𝘩𝘦 𝘸𝘰𝘳𝘬𝘴𝘩𝘰𝘱 𝘪𝘵𝘴𝘦𝘭𝘧 𝘸𝘪𝘭𝘭 𝘵𝘳𝘢𝘪𝘯 𝘺𝘰𝘶𝘳 𝘵𝘦𝘢𝘮 𝘵𝘰 𝘣𝘦 𝘮𝘰𝘳𝘦 𝘤𝘰𝘮𝘮𝘦𝘳𝘤𝘪𝘢𝘭 𝘢𝘴 𝘭𝘢𝘸𝘺𝘦𝘳𝘴. 𝘐𝘵 𝘳𝘦𝘢𝘭𝘭𝘺 𝘤𝘦𝘮𝘦𝘯𝘵𝘴 𝘵𝘩𝘦 𝘯𝘰𝘵𝘪𝘰𝘯 𝘵𝘩𝘢𝘵 𝘵𝘩𝘦𝘳𝘦 𝘢𝘳𝘦 𝘥𝘪𝘧𝘧𝘦𝘳𝘦𝘯𝘵 𝘳𝘪𝘴𝘬 𝘱𝘳𝘰𝘧𝘪𝘭𝘦𝘴 𝘵𝘰 𝘥𝘪𝘧𝘧𝘦𝘳𝘦𝘯𝘵 𝘤𝘭𝘢𝘶𝘴𝘦𝘴).

This example is filled in for buying a SaaS tool (so a vendor contract):

Pink sticky notes are the “thing that could go wrong”, and the yellow sticky note shows in which clause this could be addressed.

For each issue: think, what would be the $$$ damage if this risk materialises? And how often does this happen?

E.g. a litigation matter based on a standard SaaS tool is very unlikely but would carry significant cost. Versus missing an auto-renewal of a tool you’re not using: much lower cost but much much more likely.

𝗪𝗵𝗮𝘁 𝘁𝗼 𝗽𝘂𝘁 𝗶𝗻 𝘁𝗵𝗲 𝗽𝗹𝗮𝘆𝗯𝗼𝗼𝗸:

You could consider covering only issues that are in orange or red boxes and simply accepting everything else.

Free workshop template + recording

If you’re interested in running a workshop with your team to work through the heatmap, you can use the following assets to make your life easier!

Miro whiteboard template:

You’ll need to create a free Miro account, but then you can use this template to run the entire workshop with your team. Link HERE.

Recording of example workshop

I ran an online example workshop last year in a webinar, to show how it all works and fits together.

After watching it you should feel comfortable running it yourself!

Here’s the recording: Link HERE.

Hope that’s helpful, thanks for being here!

Daniel

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Daniel van Binsbergen
CEO at DraftPilot