Video Transcript

So I guess we can go and get started. It's going to be and we're going to fly through this. I think we have 30 minutes and 5 minutes of Q&A, so we'll move pretty quickly but I it's a topic near and dear. I think the both of, both of our hearts we've dealt and spend a lot of time dealing with contracts mostly, mostly myself on the technology front for many years and Nancy on pretty much both I think.

Nancy Alameda: Yeah. I think, you know, as I mentioned, we've outsourced a lot of procurement and I've worked at Symantec for almost 10 years but in the last 4 to 5 years we've, you know, really hardly been managing our outsource partners and then focusing on contract management. So that's really my role as contract manager for North America and working on a global scale with my counterparts in other regions. So we have a few things that we've learned and through that process, I've also learned quite a bit through the, yeah, mergers and acquisitions that I love that discussion because I can really relate to it. So anyway, might as well let's get started.

Marc Gerdy: Let's go.

Nancy Alameda: So, yeah. Just to kind of set the stage here, a lot, you know, we're going to kind of ask a few questions too because we need to understand where you feel that you're at in the contract management space because they're certainly best in class. Any contract management is good, is better than no contract management but there's different levels of course and I know for, for Symantec it's taking us well over a decade to kind of get there. I wouldn't say we are completely best in class but I feel like we're and we have a contract management tool, we have a lot of our processes that run through that tool and we have a little bit more close knit compliance and, and working with the business on following that process, so I think we're doing pretty well. So and

Marc Gerdy: And I would say from, from a Charles Schwab standpoint or actually a number of companies I've worked at, American Express, Charles Schwab, Triple Insurance, Delphi Automotive, just to name a few, but I think, you know, from a contract management standpoint, I think when you talk about and as Nancy said best in class, you know, where you at in your organization. I think that's kind of the thing we like you to kind of think about right now. Where am I? Where do I think I am from a contract management standpoint? Do I feel that in my mind I'm best in class or do I feel that I have some work to do or do I feel I have a lot of work to do? So hopefully through this, maybe we can give you some takeaway so you can go home and say, you know, back to the office tomorrow and say, "Okay. These are things I want to, I want to kind of go after and these are areas to help me move towards that kind of best in class model." So I would say out of all the companies I worked at, not of them are best in class. I think we can always improve. Maybe we're doing a good job of capturing contract in the database but we're not doing a good job of, of getting the contracts from the departments. So we'll talk more about that in a minute so.

Nancy Alameda: Excuse me?

Marc Gerdy: Who?

Nancy Alameda: I think Symantec is pretty and I wouldn't say we're the best in class but I, but I would like to believe and, and maybe you can tell me when, when we're done so we talk about what we're doing. Soand

Marc Gerdy: Yeah, and I think, I think from talking with Nancy, I mean, out of what I've seen all the companies I think Symantec is well on our way.

Nancy Alameda: We're on our way, yeah.

Marc Gerdy: I mean, you're definitely, definitely close if, if not there already so.

Nancy Alameda: Right, and as Marc mentioned, there's always room for improvement but I think it's just really key to get the processes and the tools working together because if you have processes without tools or tools without processes, you know, it just seems to fall apart no matter how hard you actually work at it. So that's something that we've learned, so we'll go through it.

Marc Gerdy: So we'll talk about that?

Nancy Alameda: Yeah, absolutely.

Marc Gerdy: Okay.

Nancy Alameda: So just, you know, Symantec. I think most of you know who we are. We're a security company. We are the fifth largest software company in the world. A lot of people don't know that. We have annual sales of 6.9 billion. We're most notably known for our Norton products, which is on what used to be called the consumer side. We have a new CEO and we're no longer allowed to say consumer versus enterprise because, you know, there's many levels in between and Norton products are good for other businesses as well. So 6.9 billion in, in sales are spent and direct spent is 3.9 billion. We have spent under management of 77%. I think the best in class number there is 85%. I'm really impressed with HP at 95%, but one note of sort of explanation there for us is Symantec buys a lot of technology that we incorporate in to our product and then we resell. So, that has all this royalty payment component and anyway, I'm sure our spend under management would be at 85% if it wasn't for all the, the product side because procurement doesn't manage that process.

Marc Gerdy: All right. So I'll talk a little bit about myself. The companies that I work for obviously Charles Schwab, so I think most of you know who Charles Schwab, but we're leading provider of financial services. We have more than 300 offices, 9 million active brokerage accounts, 1.6 million corporate retirement plan participants, about 918,000 banking accounts, 2.12 trillion client assets as of July 31st, annual sales, annual sales around 6.9 and where our revenue somewhere around 5 billion, close to 5 billion. So that's the company I work for. Justand I mentioned ISM Arizona just because I'm the president of ISM Arizona local ISM chapter. We have over 300 members and we have monthly dinner meetings and events and a number of different of seminars, CPSM trainings, all that things. So I try to give back to the, to the industry in regards to my free time in helping educate our members and, and people in the procurement field, so just something I do when I'm not, when I'm out of the office, so. Okay. So just kind of going through this with things we'll go over and we started to go in to some those already. Some, some good items. Using contracts as a risk mitigation tool, standardizing your contracts. We're going to align global contract management processes. We're going to look for spotting errors or inconsistencies in your contracts and, and contract management tools. So those are kind of the items we're going to run through here and we'll go ahead and start now, so Nancy.

Nancy Alameda: Okay. Let me get to the right page for my notes. Sorry about that.

Marc Gerdy: No problem.

Nancy Alameda: We're on using contracts as a misand sorry about this.

Marc Gerdy: Using contracts as a risk mitigation tool, so difference between looking at the contract versus appeal.

Nancy Alameda: Okay. My note is a little bit different. Okay. So first of all, we want to know when we use a contract versus PO terms and conditions because, you know, I know years ago, you know, the, the direction from legal was if you have an engagement with a supplier and we're spending $100,000 or more a year, you should really be entering in to a, a full-blown contract and, you know, we found that, you know, if you're ordering off the shelf standard items, widgets and it doesn't really necessitate, there's no services, they're not coming on site, there's no implementation, there's no really no risk associated, it really shouldn't matter. So I would definitely, you know, make sure your buyers are trained in that to have a good eye when PO terms and conditions would be sufficient. Now, conversely on the contract side, we found that our marketing department has a really hearty appetite for hiring suppliers like Lead Generators and all kinds of services that, you know, there's all kinds of private and customer data that is collected and viewed and so you could have a $10,000 hosting agreement and that is the one that's going to bite you and we've actually had an experience with that at Symantec, but that was years ago and we've tightened things up since then, so. But yeah, it's, it's really important that your buyers are fully trained and understands where the level of risk is and to make sure you have the right contract in place.

Marc Gerdy: And so, you know engagement letters. I don't know if any of you have ever signed up for those or been pushed by a vendor to do an engagement letter of some sort. Normally it shows up, right? End of month, end of quarter, end of year, you know. Sales are going to go away; deals are going to go away. Let's just put this quick engagement letter in place and then we'll be good and then you can get us appeal whenever or you finish the contract whenever. As long as we get that, we can do our Rev. Rec. and we're good to go, right? So I think, you know, the one thing around that from a technology standpoint, from a source and technology standpoint, we, we're going to avoid that altogether, right? So we're, we're going to try to stay away from any type of engagement letters. They just cost more friction, more trouble. Just, you know, the reality is you're on your knees to hold your discounts as long as you need to get the deal down and my, my motto or what I say to the vendors is, "Look, you know, the deal is going to get done when the deal gets done. You know, you guys may spend three weeks on reviewing our contract before you bring it back to us and then you want to keep us to this deadline date of the end of the month but it took you three weeks. Now, you're giving me two days. So I'll tell you what, anytime you take three weeks, then every day you're late, you extend it, extension for another day. So then by the time I get it back, we got another three or four weeks to get it done." Now, they're going to tell you they can't do that but I think the point is stay away from the engagement letter and focus, you know, focus on getting the deal done when the deal can get done and I would just avoid them. So if you're signing up for those, I would try to stop that because you're just causing yourself a lot more work, a lot more and you may still have to go to legal and get this engagement letter signed off on any way, why not have legal just focus on hoping to get the deal done and, and push the vendor to, to give you the time you need so.

Nancy Alameda: Knowing when to use the vendor's contract form. Just wanted to get kind of a quick idea. If you're organization has their own contract templates to any degree, can you hold up your hand?

Marc Gerdy: How many of you have their own templates?

Nancy Alameda: Awesome. Okay.

Marc Gerdy: More than, more than 10?

Nancy Alameda: More than 10 contract templates? Good.

Marc Gerdy: Wow! Impressive.

Nancy Alameda: So you got a pretty mature and that's excellent. You know, over time, we kind of done the same thing. We've got about 12 or 13 contract forms. Now, there's times right when you, you need to sign up to a vendor form and, you know, the reason I bring this up is a lot of buyers get bogged down on this, right? Especially, you know, we've outsourced and so things become sort of black and white to the partners that are performing this task. So they say, "Well, Symantec's position is always use Symantec form first." You know, that is our first position, use our form. But if it's an event, you know, if it's a subscription service for, you know, and there's no services associated with it, you know, no special services, they're not coming on site, there's no added risk, if the, the engagement doesn't really lend itself to using our form, then don't push that form, you know. So and what we do particularly like on the event side and there might be those of you here that do the same thing is we have our legal comes up with an addendum, so it isn't an amendment. We're not amending the contract but we're telling the venue or the hotel or whatever that, "Okay. We'll sign up to this, your contract form but we're going to addendum in some protections for us." And a lot of times, that has to do with making terms mutual, right? We can't change the terms because we're just doing the addendum blindly, so we're just kind of making those terms mutual.

Marc Gerdy: Yeah, and I, I think, you know, just when you think about that. I mean, I think the, the goal is obviously to try to use your templates as we discussed not always going to be the case. But if you make it a habit and if you haven't worked with your legal department yet or you're not at that point, I mean, you even just start with the NDA because I found that with different companies I worked at that didn't have that setup or they had all these templates that I just start with the NDA. How about we, how about I sit down with the legal department and we just work together to get a baseline NDA and place its mutual that I can use in my position for now and then that slowly builds in to, "Hey. By the way, that's working out and" You know, test it for a little bit because some companies have a real, you know, from a cultural standpoint, they may have a real issue with "No, we don't do, you know, we don't do that here. That's not what legal does. We haven't, we haven't done these standard agreements, you know." So some companies really have a, have a strange culture on that, you know. So you're trying to educate them as well as get to the, the angle which is to have those contract forms. So, you know, spend the time, get the NDA as kind of the first, the first run. Get the mutual NDA put in place and get started there. And then once that's success and after four or five engagements and you go back and say, "Hey. That worked really well. How about we know have our conversation about getting the master services agreement or master purchases agreement or, you know, whatever it is emplaced as the next one?" and just kind of work your way through them or, or at that point maybe have a conversation with them. "Hey. That worked really well. How about we just put, you know, five or so of these emplaced? I think it's really going to help us."

Nancy Alameda: Absolutely and that kind of leads in to the next bullet here about creating a contract playbook. If you got your standard forms and, you know, we got to work with our legal really to get those forms and, you know, they help us regularly update them. So the playbook. How and a show of hands of those who have contract playbooks? It's kind of a guide to help your buyers. We got a couple of people in the room that have some contract playbooks. You know, I think it's really beneficial to have this because, you know, it's always going to give you your first position, right? These are our most, you know, these are our favorite clauses. This is what we prefer. You know, we want 2 million dollars' worth of umbrella, we want that million dollars in professional liability, we want all these stuff. But in the reality of it, maybe the engagement doesn't really need it. But so the playbook is excellent because it provides the buyer a tool to go through and figure out, you know, "Okay. This is my first position. What can I and what can be my second position, what can be my third position without going to legal to get those approved?" Naturally, when you're changing certain sections of the contract, you're going to have to go to business units like tax and treasury and risk and so on too but that can also be something that's handled in the playbook. Having contacts for all of those internal business unit approvers would also be in the playbook. Well, collecting thisand So, it's interesting and we have insurance requirements. We don't go collect certificates of insurance ourselves. I don't know what other companies do. I think our group that does subcontracting were all of that is all those subcontractors going in our customer side I think and then, you know, I don't know.

Marc Gerdy: At our company, it's part of the procurement function. We collect this certificate of insurance as part of the process so it's and

Nancy Alameda: Okay. Yeah. Excuse me. Well, I think the buyer and okay. So in our and right. So in our organization, the buyer is the voice to the supplier and when that, the supplier says, "Well, you know, I can't make that million dollar and I have 500,000 dollars policy. I'm not going to get a larger policy just for Symantec." Then what I would do or what the buyer would do is take that to our risk department and say, "This is the engagement. This is what we're paying for the services. This is the, you know, this is what they're doing," and then they approve whether we can accept that or not.

Marc Gerdy: I think, I think the hope of the playbook is to get to a point where that playbook is kind of the next step when you, you talk about this evolution and going to invest in class. I think the playbook is after you've now got your 10 or 12 or whatever it is set contracts in place. Now start focusing if we're getting that playbook because once you have that playbook, now you're going to be able to say, "Okay. I have, I have the playbook in place and that's going to support maybe one or two rounds of me work and my team working with the vendor prior to getting legal engaged," because legal has already said, "Yeah, you can go back with these two rounds of and in these sections within the contracts." You can go back with those, with those responses and as long as the vendor agrees, when you go back to legal, it's and yeah, they didn't agree the first round, but they agreed to second. Here's all the things they agreed to and then you've kind of cut down the time where you're engaging legal and you cut down the time for, for, for legal to have to, you know, be involved which is, you know, obviously a lot of cost for them. It's also, also time wise hopefully the goal for you. I mean the goal for us from a procurement standpoint. The source is the same way as Roy to reduce our, our amount of time that we're having to go through an engagement, right? Instead of dropping legal that and then half and a half, four or five back and forth with the vendor, maybe two or three calls, who knows where it ends up but the thought is to try to prevent that. So that's where this, the playbook kind of starts to come in to play there.

Nancy Alameda: And there's certainly an investment of time and energy on, in the procurement leaders and the legal staff to train the buyers, right? You can't just like create this work, this playbook and then throw it at them and say, you know, "Go ahead and use this the next time, you know, negotiate a contract. You do have to have some other training and then upkeep, you know. Go, you know, touch base with them. Our legal department has like and I don't even know what they call it. It's like on a monthly basis. It's just kind of like a lunch sort of meeting. You know, you just talk about current things. You have questions, do you need help with legal, just general questions and then, you know, if, if you feel that you need some help with that playbook, you know, you can bring it up that time.

Marc Gerdy: Yeah, I think having the monthly meeting or quarterly or whatever it is with your legal department is a great, a great way to kind of grow that relationship as well as, you know, we need them, right, and we need finance, we need legal. So I mean, we want to, we want to have a good relationship with them and I think all of you know that, but it's just getting that cadence with them is, is very beneficial and you can bring these type of things up in those conversations and gain agreement and understanding that, that, you know, having this type of things emplaced down the road would be very beneficial for, for both, both parties within the organization so and

Nancy Alameda: Another element on risk mitigation that, you know, he and I were talking about that I thought was really important is that and who in the room and raise your hand if you have like a preferred supplier list or an approved supplier list that you give your stakeholders? You do? Okay.

Marc Gerdy: Yeah, this is a good one.

Nancy Alameda: Okay. So you give your stakeholders you say. Like at Symantec we say, "Okay. This is our process. If the purchase is over $25,000 and the supplier that you want to choose is not on the approved supplier list, you must enter a procurement intake form," which happens to be and we can talk about it later, but it happens to be as part of our tool that we use.

Marc Gerdy: Right.

Nancy Alameda: That kind of kicks of that process. So the key here though is if you have approved suppliers, a couple of things. Once you put them on the approved supplier list, don't just leave them there. You need to make sure that you scrub that list, update it, take them off, put them on and that sort of thing. It's really easy to put them on the approved supplier list and leave them there.

Marc Gerdy: Yeah. I think the bigger risk too that comes up, we talked about, you know, we're talking about using contracts as a risk mitigation tool. One of the things you have to be really careful with right, you put them in as a preferred supplier and the department comes in and says, "Hey. We're putting them on as a preferred supplier, can we and you know, we want to go do a and they're going to do the statement and work for us and they're going to come in and they're going to do these things," and you're going, "No, we signed a purchased and yeah, it was for product. This isn't for services. We don't have a services agreement." "Well, but you said they are preferred vendor. What's the and" so I think that's one of the things that, you know, you want to kind of be cautious of from a pitfall that you can run in to with, you know. Make sure you and I would state that if you're having a list or something you're sharing with that group or you're just reviewing with them on, on a basis internal that you have down, here's exactly what type of things you can buy today as a preferred vendor versus, you know. Because I think sometimes that might be missed and then what happens is now they're coming to you saying, "They're a preferred vendor. I want to, I want to buy. What's the problem? What do you mean it's going to take three months to work through a legal contract? I thought we had a contract." So just, I think that communication with your business and, you know, clients internally is important because that can run you into some, some headaches there and all of a sudden now you're not and that as value add because you're selling the process and I thought this preferred supplier thing was going to help use move things along quicker, so.

Nancy Alameda: Yeah, absolutely and again, you know, that's something that can be managed in a tool, something, you know, your approved supplier list is, you know, in the tool. They're, they're marked as approved supplier but you marked them as and at a commodity basis and then a sub-commodity level. You can certainly take it down as far as you want to go and then do some reporting out of there for your stakeholders. We provide our approved supplier list updated monthly and put it on our internal website for our stakeholders, so it's going to be pretty helpful.

Marc Gerdy: Yeah, so time to standardize.

Nancy Alameda: Yeah, we talked about this already how, you know, it's pretty important to have your, your own templates wherever possible and again, the time saved in redlining your contract form for your resources is going to be a lot less than trying to add in all of your favorite terms and conditions and redlining a vendor form.

Marc Gerdy: Yeah, and I think one thing, you know, I just want to mention and we talked the last like a little bit about that risk mitigation and now you're going to standardizing contracts. But I think, you know, there's a piece in here, you know, when I think about it from a technology side, this always comes up. Our technology teams always want to go and test and try our products. I mean, it's, it's an everyday event for me. I get a call and it's, "Hey. We got the perfect product. We're ready to trial it. Vendor said they'll do it at no cost. We want to get started tomorrow. What do you think? They said I should come see you and see what your thoughts are before we you know we go forward and I want to make sure we know what we need to do. So we're ready to trial, what's, what's next?" You know, and so I think that's one of the things, you know, you really got to be cautious of is, you know, how much, you know, I guess how many of you in the room are aware of, you know, this is and if you raise your hands, I'd be very impressed. How many of you in the room here have the ability to know all of the trial, let's just say hardware and we could say printers or we could say desktops, laptops, servers and are you aware of, of all of that is being tried out or tested in your organization today? Maybe one. Okay. So, so one of the dangers, you know, in this contracting conversation is, you know, you want to have a trial agreement in place with, with all the products you're trying in the organization. I think one of the dangers when we talk about these vendors coming in to these POCs, we all know what that is, right? That's take the keys, test drive the car, take it for a week, come back and guess what, make sure you tell me if you like the car, if you like the sunroof, if it drives nice, how's the steering, does it break well. So anyway, are you ready to buy the car? And what's the one conversation that never comes up and I'm big in to negotiations, right, so that's what this is all about for all of us. This is what we do, that's really the core of what we do. You haven't talked about the price yet and most of my clients will say to me, "Well, you know, I asked them for budgetary numbers. I made sure not to negotiate with the vendor," and, you know, the reality of it is you never found out what the real price of the product is and you're going and going to test and trial this product for the organization. You know, I tell them forget the budgetary stuff. If you're going to go talk to them about a trial, at least if I can't get in front of you to talk to them, at least make them guarantee they give you a discounted price to show you the list, discount and final amount of what you're going to pay for that product because that all goes back to these contracts and putting that trial agreement in place and part of the trial agreement discussion is making sure you're locking in things like, you know, how much would this cost if I had to buy it when I done with the trial. How long is the trial for, right? Because the last thing we want, which is the call I've gotten over the years is in different companies and I won't say which company it was but the call was, "The vendor came in and said it's going to be $600,000 for the server and I don't understand how it could cost that much and it never wouldn't cost us that much. But anyway, what we found out was it's, it's managing a lot of our production systems and I can't really pull one out and I can't find a contract and I don't think we ever bought it. I think it was a trial way down and somehow got in our environment somehow, so I'm not sure how it got there." So this is where it's so important. I think the people in the room that are doing a good job of this obviously, it's, it's one of those things we kind of tend to forget about or, or, or we just don't have a lot of time to mess with it. But I think making sure that you're getting in front of all these trials and things and it's ultimately sales, right? It's ultimately the sales guy trying to win business and trying to go around all of us. So, how do we, you know, make sure we can get in front of that is at least make sure you have the trial agreement, make sure you have a number of things, you know, listed in that trial agreement to talk about all, you know, how long this trial, when it's going to be completed, all those things; or at least if you end up with it in your environment, you know, six months down the road or eight months down the road, at least you can go back to the vendor and say, "Well, I do have a trial agreement here that say it was a 30-day trial. I mean, did you ask for it back or do, do we have something that happened that said obviously, it accidentally got stayed here." But at least and well, if we get in a situation where they won't take it back, at least we can say, "Well, I know this cost is only going to be this much. It's only going to be $30,000 because $30,000 is what it said in the trial. That's what I would pay if I had to buy it." So that's where this trial agreement kind of conversation comes in to play but try to keep, try to keep away from these test, trial my car. I try to say put it in a RFP or Competitive RFX process and do it as part of that process. I think that's the goal we all try to accomplish but that doesn't always happen. But if nothing else, make sure, you know, I, I try to get in a room with that vendor early on and negotiate that, that piece of it to say, "Yeah. All right. That's probably just trial agreement. What's the real price we're going to pay? Tell me the discount." You know, get in all those conversations and get it in writing and at least you know if nothing else as you do move forward, you're in a, you're in a better position than you were before, so.

Nancy Alameda: Okay. We're going to skip down to the bottom bullet because already addressed the one above that and I, and then we can kind of and I think we need to kind go a little bit quicker but and it's so easy to talk about all these stuff. So minimizing "Gotcha", risky clause. I'm sure that all of us have experienced, you know, you inherit agreement. You go through it and you're like, "Geez, who signed to this?" You know, and then you see it signed it by a vice president or senior vice president. You're like, "Oh! My God. What are they thinking?"

Marc Gerdy: Happens.

Nancy Alameda: I know working on the, the MNA team and procurement, you know, God, you wouldn't believe the stuff that we acquire. We've had some pretty large acquisitions. Probably our largest was Verisign, the authentication business unit. We didn't buy the whole company and so, you know, it's incredible when you look and see what, what other companies have signed up to. Probably the one that has got us the most and you may be able to relate to this are the auto-renew clauses. You know, Symantec's first and you know, our default position is we do not sign up for any auto-renewal under any circumstance unless of course, you know, there is some of sort of, you know, really good deal. You know, you buy two or three years or something at a time but the auto-renew is just awful. We have to have notice. We have to be able to say that we want to renew or we don't want to renew and you can certainly negotiate termination fees if it is a type of service to warrant termination fees. If, you know, you're just so integrated and it's going to, you know, make sure you have a transition plan and a transition, you know, exhibit on your contract. If, you know, you're going to terminate that contract, you want to make sure you get your data back. You want to make sure that they're going to work with you to get your information and data back. If you don't have that included when you do the termination then that can be a really big problem.

Marc Gerdy: I think though the one that jumps out of me all the time is the, the payment terms. The and especially in IT for software, right? It's while we're at the end of the, you know, the end of the term, let's say 3% increase, 4% increase, 5%, who know, but there's some type of increase at the end once you come out of the initial term. Obviously, we all know you got to try to lock that in early. Lock it in as a part of the, as part of negotiating these deals and I always say and if you guys haven't done this, I would say CPI. If you're going to really go down the path, CPI, Consumer Price Index or if you're, if you're and then pick your number, 1%, 2%, 3% I wouldn't go about 3 and say lesser of the two, so lesser of the two, and hopefully you can land on, you know, CPI and for now that's pretty good. But I see all too often the vendor slap 3% increase yearly on and half the time people aren't paying attention to it. So it's an easy win for us if we can have that conversation with the vendor because you're going to get them to move on it because what's their argument? I'm doing extra things for you, I'm, you know. Its, its just and it's a cash cowand I mean, it's just free money, so. So fight the, fight the increases, these basic increases especially if you just signed that one in your contract and then you considered you're too being out of the term, you know. So now, now all of a sudden the contract that you signed, maybe it got missed, maybe legal has a standard template that says it's 3% no matter what or 4% no matter what and you just pushed it out to a vendor and missed that. Your team member is signing out the vendor and you missed it, it was automatic 3%. You know, we'll start at zero or start at one or start at something but, you know, make you're negotiating that. I think some people miss that and them later, you're paying that increase and you're wondering how it got caught in that so. So from a contract standpoint, I think, you know, the piece is, you know, keep an eye on these contracts and, and what's going in on as the deal and you know, we may negotiate a great deal up front but that contract could, could trump that later on. Yeah, let's move. Global?

Nancy Alameda: I love this picture. Aligning global contract management processes. We've worked really hard at this one in Symantec because we already told and we always told the stakeholders that we have a global process but in reality we did not have global process because, you know, Amaya is special because they have 22 instances of Oracle one for every country and therefore blah, blah, blah. So anyway, long and short of it is, we work really, really hard and we now meet regularly with our global counterparts. We have, as I've said, we've been outsourced primarily, so we have category leads and managers. I'm at services category manager and a contracts category manager, so I meet with my counterparts in Amaya and APJ. We make sure that we're in alignment and we make sure that we're taking advantage of global agreements. Let me give you an example here. So, Symantec has an enterprise level agreement with Microsoft and we drew up at the end of the year and so we pay a lot of money for Microsoft licenses. They are all internally implemented. Basically, we have a process where internal customers will come through a different portal to request Microsoft software and then it actually gets deployed by IT and not procurement because we don't have to pay for it. They're the ones that are keeping track of how many we're releasing. We found out from our APJ counterparts that they were told by Microsoft that in order to buy Microsoft product in that country whatever country it was in APJ, they had to have a select agreement. Those of you that have purchased Microsoft know that that's just an alternative business agreement, a select agreement. You select the reseller of who you're going to go through and, and then, and then, and you get your special favored pricing directly from Microsoft. So, the enterprise level agreement, you know, you get, you get everything, right? And in the select agreement, you're paying by the drain so you have to issue a PO under the select agreement. So we found out that we were overpaying for licenses. You know, I don't even remember how much money it was, but it was a lot of money and it was a very expensive lesson. So really aligning global processes and working with counterparts, making sure that you are, you know, you're processing under a global agreement, you're not creating new agreements locally unless you absolutely have to. Now, in some cases you might have a global agreement but it might exclude a country or two. I mean, we have a couple that are like that too. So and again, it gets back toand we're going to talk about the tool in a minute but having that contract management tool that identifies what truly is a global agreement versus just regional specific or country specific. So, spotting inconsistencies or errors in your contracts, I think we sort of touched on a little bit of, of some of the risk component but, you know, we at Symantec, security is our brand so we frequently audit our contracts just to make sure that they have the information security and data privacy language that it needs. So, you know, that was something very important for us to remediate. You might go through your contracts and say, "Oh, you know, the insurance requirements aren't high enough," or, you know, other sections of the contracts are just not your current terms and conditions that are coming out of legal. We have to be able to prioritize to mitigate any risk there to see if you want to remediate. You want to have a sec?

Marc Gerdy: Yeah. I mean, you know, I think making sure you include other changes when you're putting, putting the contracts in place is important, right? So, you know if there's a chance to open an agreement and make changes, that's a good thing to do at that time and address changes within the legal group that you want to put it or anything in your group that you're trying to put in those, that contract. I think the thing to be really careful about here is, you know, it's like opening up a can of worms, right? I mean, once that contract is opened, it can get ugly. So just, I think that the one takeaway I would say in this that I've run in to over the years, I'm sure a lot of you have as well is, you know, you're trying to get a purchase made and you take the contractand you know, you tell the legal firm you're ready to make a purchase and they said, "Oh well, that contract is five years old," and you said, "Yeah. So? We need to make purchase. We made 20 this year already. What's the issue?" "Well, we now want to make, want to make this three or four changes and we now, you know." So that becomes a real issue, right, because you're trying to make a purchase, you're trying to move forward and now you're caught up in this and your client is getting upset because they thought they could just make a purchase and now they're, they're in a three-month cycle of a contract, can of worms negotiation of both side wanting to add new language. So I think that's one of the things I would say is kind of one of those pitfalls or things to be careful with, you know, and try to find a way to make sure that you have that communication we discussed earlier with your legal organization so that it's not and we get to open up the contract anytime you go to purchase something with it. It's, it's more of a proactive process, you know. It's more of aand "Okay. So there are certain vendors we want to open up the contract with, when do we want to do that this year? How do we do it without affecting the current business we're doing? Is it really high risk? Who, who's theand" It's always about who has the most risk or is it so much risk that, you know, I'm taking on all these risks and I need to make those changes or is it, hey, we can make the order. We're okay, let's address it later," even if sometimes I don't know if some of youand we have a risk memo letter. We can get the organization signed and then say we'll go address these items later. So I don't know if you do any type of risk memo letters or something within your business units to say, "Look. If you really want this today, I can get that for you there but there's these three things that still need addressed on the contract and you're going to have to sign up for that risk," if the business is a signed contract. I know some of you actually sign them at procurement but you may still do some type of risk letters with your business groups. So that's just one of the things I would say as a takeaway to kind of plan out how you want to manage that because that can become a real problem. I mean, it can really cause a lot of stir within your group in trying to support the organization when you have these contracts or constantly being opened up every time you try to make a purchase or, you know, there's this new whatever some type of and your organization does an internal audit and all of a sudden they want to change this thing in every contract. Well, great but we're not going to open up every contract today and we're not going to stop every single purchase to make that change unless it's something that's going to really put, put a ton of risk on us so.

Nancy Alameda: Good. I want to make sure that we have time for Q&A here, so I think we have five minutes left, that's all.

Marc Gerdy: Okay.

Nancy Alameda: If we can just go to contract management tools, we'll just do one minute there. Are we there?

Marc Gerdy: I'm right with you.

Nancy Alameda: Okay. Benefits of single repository. So there are just a couple of things here. Raise your hands if you do have a single repository. I don't care if it's SharePoint or and excellent. Okay, awesome. So there's definitely a benefit having a single repository. I know for us we thought we had a single repository until we found out what we didn't have. So what'sand?

Marc Gerdy: Wait. If you said you had a single repository and you said you don't have all your contracts in one point and you're best in class and wait a minute. Are you best in class?

Nancy Alameda: Yeah, that's okay. Yeah.

Marc Gerdy: So some of the takeaways, right? Am I best in class? You know, if I had my contracts in one place and you're starting, you're getting close, right?

Nancy Alameda: Absolutely and in and if anybody says, "Oh yeah. We, we have all of our contracts in one place." You know, well I would, you know and we, we should have. We just and we use Apttus, which is a plug-in to SalesForce.com and we use that for and from the procurement initiation request all the way to the very end in uploading the contract and then sending out automatic notifications when the contracts are coming up for renewal. So that's a real benefit and we can also track estimated savings in the tool and it has all kinds of bells and whistles that we haven't used yet, so.

Marc Gerdy: I mean, there are a number of tools out there if any of you, you know, I mean, I remember years ago Hummingbird use, you know, Oracle has contract. I mean, you know, there are a number of companies out there that have these contracts there. Some people do use share that can use SharePoint to an extent if you don't have the money to invest in the other tools but I think the important piece is getting in that and then I think the other piece of that is, so what are you doing on the other end of that? If you are capturing your contracts, what are you doing with the business units to make sure that you have process procedure policy in place to make sure those contracts are getting to you; and if you're not getting them, have you put something in place to maybe audit the groups yearly or have some conversation with them? You're "By the way, I know that and I hadn't seen a contract from your group lately and I know, I know we've signed some deals. Can we get those over to us so we got to get those in the database and get those tracked?" And I think the hierarchy which can become a real problem. Sometimes people dump everything at database and have no parent-to-child relationship, right? And then it's like, "Well, now I'm going to spend the next hour digging through, trying to figure out which contract with that vendor is actually the one that we're working off. Wasn't there an amendment?" I mean, the technology is really tough, right? You know, I won't say the vendor's name but we have 52, we have 52 contracts, so we have a master and we have, you know, 40 plus amendments but which one really is the one and which and of each one. But I would say and your vendors as well. Play, play the vendors to your advantage where you can have them, have them send you the contracts. I know a lot of people say, "Well, I don't want to ask them that. They'll think I don't have the contracts." Forget about, don't worry about that. Tell vendor, "I need the contracts as part of my engagement with you, our relationship. Part of what you need to do is report. You need to give me a copy and actually, bring your team in and walk me through each contract and tell me, you know, put a binder together and walk me through every contract and tell me what's in them. Tell me what and if I actually do a high-level summary, tell me what's in each one and have that by next Wednesday because we're going to meet on it. We're going to talk about it." You know, don't be afraid to challenge your vendors and say, "I'm just doing a and I'm comparing these. I'm getting them in front of in our relationship. It's important," and half the time I found out that the sales account managers don't even understand what contracts they have. They call me like, "I didn't realize you had a contract with XYZ Company. You bought them, right?" "Yeah," "well, I didn't even know you had contract." "Well, yeah. We do." "So why don't you get them all together so we can manage the contracts properly?" So don't be afraid to challenge your vendors to give you what you need so you can manage it from a number of fronts, right? You're managing internally and on other fronts as well.

Nancy Alameda: Okay. It looks like we're out of time. Can we take two minutes, three minutes for questions? Yeah?

Marc Gerdy: Okay. Thank you.

Nancy Alameda: Thank you. Sorry we went and

Marc Gerdy: Can we just do some Q&A?

Nancy Alameda: When you got two speakers, it's kind of hard.

Marc Gerdy: Yeah. We tried to manage the best we could.

Nancy Alameda: Did we answer all your questions or is there a question?

Marc Gerdy: I knew there was a good reason why I gave her the mic? Sorry. Sorry, Nancy.

Female Speaker: No. My question is, it sounded like you have pretty robust contract management repository that your senior buyers are purchasing from and you have the playbooks. What we found is we have four shared services centers in different parts of the world and so they still revert back to the PO terms and conditions, and so probably about every three months, I'm updating my PO terms and conditions. For instance, they weren't signing trademark agreements when they use our logo in multiple places and so now we put little notes on, you must check your brand book specifications that adhere to them and so I could just constantly I'm reliving my PO terms and conditions. Are you doing the same or you're focusing more on the MSAs?

Nancy Alameda: That's a good question. We do update PO terms and conditions pretty frequently but when it comes and if there's a brand trademark sort of requirement, we're really sticky on that and we have a brand department. We have a and in our standard contract, we say you cannot use anything. You can't, you know, the only thing you can do is put Symantec on your customer relationship list. You can't use our logo, you can't do anything else. So if there is a brand, it has to be in the master agreement to be addressed. It's not addressed in our PO terms and conditions. Well, it's addressed in a default position as soon as you can.

Marc Gerdy: Yeah. I can't say that over my career I've saw that we were constantly changing PO terms. I would say we're spending more time on making sure that and yeah, I can tell you the companies I've worked for that and I mean, you might and you may update on, you know, yearly or every, you know, 18 months, something like that, but I don't know about changing the PO terms every month.

Nancy Alameda: Yeah. I would find a way to make sure that they are using and for something like that, I would make sure they use a contract.

Marc Gerdy: Yeah.

Nancy Alameda: Yeah. That's, that's a proper and

Marc Gerdy: Thank you. And, and the other question? You want to switch? You want and all right. Hand off and . We can and

Male Speaker: Stephen with the International Baccalaureate. You made a good point earlier on about the different type of systems that you can use to answer repository for all your contract information and managing the process. We use Oracle Advanced Procurement as a single instance and if anybody would like just connect up and talk about their experience if anybody else is using Oracle, I'd be happy to, to meet them.

Marc Gerdy: Yeah, thanks. I know back and this is a little while ago. I don't even know if Hummingbird is still around because I haven't looked at their tool recently, but I know Hummingbird. In the tool, I was looking that we had, had and the company that had Hummingbird, they had it for years and they were tracking all contracts in there and then what I found was there was a tool that could link the contracts from Hummingbird into SharePoint. So I think you're just using SharePoint then and when you're in SharePoint, it would show the contract in there but it was just a, it was kind of and it was really pointing you back to the Hummingbird tool but it was with, dealt within SharePoint. So there are some different things you can do if you have challenge around cost and you're trying to figure out, "How can I manage this? I'm just using SharePoint today." You know, there are some things you can do around that as well as if you do have a contract database and you want to use SharePoint still to do other things, you can kind of build that relationship there as well.