Role of IT in Managing Digital Agreements is Rising Through the Era of Contactless Engagement
Since 2000, organizations have been slowly working toward replacing manual wet-signature agreement processes as a result of the Electronic Signatures in Global and National Commerce Act.
2020, however, has turbo charged the transformation of how agreements -- within and between organizations -- are formed and enforced.
Enterprise-wide adoption of digital agreements and acceptance of digital signatures are as much an issue of managing organizational (and inter-organizational) culture as it is about technology management.
Lane Cooper, CIO.com
Enterprise-wide adoption of digital agreements and acceptance of digital signatures are as much an issue of managing organizational (and inter-organizational) culture as it is about technology management. This was one of the central conclusions of a CIO.com virtual roundtable I recently moderated under the Chatham House Rule with DocuSign CTO Kamal Hathi. The discussion explored how the era of contactless engagement -- driven by the rise in remote work and digital end-to-end workflows -- is elevating the role of IT in enabling a new generation of internal and external agreements.
Since 2000, organizations have been slowly working toward replacing manual wet-signature agreement processes as a result of the Electronic Signatures in Global and National Commerce Act. For two decades, the act has stipulated that a contract relating to a transaction cannot be denied legal effect solely because of an electronic signature and that no contract, record, or signature can be denied legal effect solely because it is in an electronic form.
The pandemic year of 2020, however, has turbo charged the transformation of how agreements -- within and between organizations -- are formed and enforced. As leaders in the public, private and non-profit sectors embrace comprehensive digital agreement paradigms, IT organizations are being tasked with supporting agreements with customers, partners and employees. Below are are some of the key observations that emerged from our executive discussion:
It became clear from the very beginning that digital agreements and the acceptance of digital signatures are as much an issue of managing organizational (and inter-organizational) culture as it is about technology management. We discussed the wide spectrum of maturity that exists around digital agreements for both internal and external purposes.
In some ways, getting internal buy-in seems to be the more straightforward proposition. We had several of our participants indicate that one successful approach to securing adoption of digital documents revolves around identifying the most vocal critics, and winning them over with the simplicity and speed that comes with more automated approaches to executing contracts. It provides an opportunity to overcome concerns about the legality of digital signatures while demonstrating how much more efficient the process of negotiating and redlining agreements can be. In this sense, we can take a note from the automotive industry, and put into practices the “test drive” model. If you can get colleagues into the vehicle, you are well on your way to gaining acceptance -- and even advocacy.
On the external front, the challenge is a bit more daunting. This, of course, is problematic, because when it comes to contracts...it really does take at least two to tango. As it relates to interorganizational digital agreements, it does seem that enterprise technology staff will have to engage in a form of “digital diplomacy” to assure IT departments and legal representatives on the other side of the transaction of the enhanced security, integrity and efficacy that comes with intelligent contracts. It represents a new “soft” skill set that IT may have to develop. It also requires technology teams, line-of-business executives and corporate counsel to have a strong joint understanding of how to present digital agreements to trading partners.
While it seems clear that larger organizations are in a position to demand compliance with digital agreements (major hubs have always had this position) they still need to provide their trading partners with the tools and education to make the transition away from manual processes as efficient and effective as possible. For smaller or mid-sized organizations that manage a spectrum of sophistication on both the buy and sell side of the equation. This is where agility, flexibility and powers of persuasion emerge as a major skill set that will be critical to encouraging adoption and moving toward a single, common approach to intelligent, automated contract management environments.
There was a clear consensus in the room that the most effective path forward toward adoption of digital agreements and acceptance of digital signatures would emerge from the integration of digital tools into workflows and applications that are used on a daily basis by users. To this end, the point was made by several participants that end-to-end digital processes cannot be completed if wet signatures or manual contract procedures continue to exist. It is for this reason that it is probably not a good idea for intelligent agreements and e-signature to be introduced as point solutions that are separated from larger strategic initiatives that change the culture of organizations at scale.
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