Legal Ops: How to Enable Seamless Vendor Onboarding

For most companies, onboarding vendors is an ongoing necessity. Legal departments, specifically Legal Ops, should be seeking to make the vendor onboarding process as seamless and efficient as possible. Legal Ops can speed up the vendor onboarding process by automating the creation of standard vendor contracts and reduce legal review. And just as importantly, it will allow the highly trained attorneys in Legal to devote more time to high-value transactions.

Here are some ways for Legal Ops to seamlessly onboard vendors for the company.

With the vendor onboarding process, legal teams can run into the same criticisms they do with other processes: they move too slowly. For companies trying to scale quickly and increase their transaction volume, the traditional contracting process will be too slow and cumbersome. Legal needs to find ways to keep up with the speed requirements of modern business.

Legal Ops can begin to move more quickly by shifting from traditional paper contracts to digital contract management, including click-to-accept agreements like clickwrap. Digitally native contracts are ideal for contracts that require little to no negotiation – like NDAs, Terms and Conditions, etc – since they are presented as take-it-or-leave-it agreements. This cuts down on the review and approval process, which often involves endless redlining and back-and-forth negotiations.

Legals Ops can enable self-service workflows to onboard vendors 

To make it as easy as possible to onboard vendors, enable self-service onboarding. This can be done by implementing self-service workflows, in which vendors can be onboarded without the need for direct, hand-holding involvement from Legal or Procurement teams. This requires businesses to have a thorough understanding of and distinction between standardized and personalized contracts.

Distinguishing between personalized and standardized contracts can help the legal team make more accurate assessments of how to allot their time.

Standardized contracts are agreements with standard terms that are sent to many signers as is. That is, they require little to no negotiation and redlining from the signers. Standardized agreements are often high-volume, low-value contracts – ones that are necessary to protect the business, but don’t usually have associated revenue. Vendor contracts often fall into this category.

Personalized contracts, on the other hand, are less frequent, higher value, and sent to specific signers. These are not as conducive to containing standard terms, and they will generally require more negotiation.

Use standardized contracts for self-service vendor onboarding

For standardized agreements like vendor contracts, Legal Ops can create pre-approved templates that contain all the necessary terms and legal protections. Then the vendor can use the self-service workflow to input their own information. This will result in the vendor onboarding process becoming faster, more efficient, and scalable – everything a business dreams of!

Clickwrap agreements are the most cost-efficient way of handling standardized contracts. 

These agreements cut costs, improve the user experience, and have proved to be highly enforceable in courts of law when clickwrap best practices are followed.

Once new vendors are onboarded, the goal should be to strengthen the ongoing relationship with the vendor. One tactic for doing so is to provide a centralized hub for onboarded vendors, where they can easily access and view their contracts at any time. Save them the trouble of digging through old emails or documents saved on their own servers. This will both build goodwill and prevent any confusion about contract terms.

The DoorDash Model of Success for Vendor Onboarding

The restaurant delivery service and Ironclad customer, DoorDash, provides an excellent model of successful vendor onboarding. The company needs to rapidly process vendor contracts for restaurants enrolling with them. But in the pressure to maintain sales velocity, it was common for sales reps to find workarounds. While restaurants were enrolled quickly, there was an unacceptable sacrifice in contract uniformity and legal compliance.

And one particular challenge with DoorDash vendors? Restaurant managers are generally on their feet and on the move, with little free time, as opposed to sitting behind a computer. These managers needed a flexible and easy way to enter into vendor contracts.

The solution? DoorDash now utilizes clickwrap agreements for its vendor contracts. Since these are digitally native contracts that can be accepted with the click of a button or check of a box, the review-and-approval back-and-forth is eliminated. In addition, the sales team can text or email self-service forms to the restaurant managers, making contract acceptance even faster and easier.

The DoorDash experience demonstrates the importance of speed and efficiency for B2B transactions. A drawn-out contracting process can result in buyer dropoff, especially for busy on-the-go professionals during their workday. 

Implementing a simple, self-service contracting process for vendors helps with both sales velocity and legal compliance. This will make Legal as happy as the rest of the company.

Now more than ever, legal is a strategic business unit that contributes to the overall growth of a company, rather than focus solely on risk mitigation. So thinking up innovative solutions to common problems is now required to excel at the job. Enabling the quick and seamless onboarding of vendors into your app or onto your service is one way to provide value from the legal department.