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Legal Department Adoptionof Contract Lifecycle ManagementSolutions: Perspectives FromCorporate Paralegals

EXECUTIVE SUMMARYThe paralegal has a critical and central role in the efficiency and operational effectivenessof the corporate legal department. One major function essential to the legal departmentwhere paralegals play a pivotal role is contract lifecycle management (“CLM”). Frequentlyparalegals are involved in most or all phases of that lifecycle, as well as managing the systemsand processes in place necessary to ensure not only that nothing slips through the cracks,but also that pre-execution and execution phases move along smoothly to facilitate dealvelocity, thereby adding to the legal department’s growing role as a company value driver.In light of the critical nature of the corporate paralegal’s role in CLM and in managingthe related systems and processes, NALA and Wolters Kluwer partnered to conduct a surveyacross the corporate paralegal industry to investigate various trends in how corporate legaldepartments are adopting and employing technology for CLM, including: The types of systems – both those streamlined for CLM, and those repurposed for CLM – departments utilize The different ways departments are employing CLM software The trends and challenges in adoption The most important factors and product features in buying decisionsThis report highlights high-level findings and cross-tabulations from the survey. Roughly 150paralegals across sectors, company and department sizes, and experience levels weighedin via a series of qualitative and quantitative questions sent electronically. The most importantthemes our study highlights are: (i) most companies are still losing major efficiencies throughover-dependence on makeshift, or informal CLM solutions through much of the contractlifecycle, and (ii) vendor support (customer service, customization, onboarding, training,legacy document and data loading) and a comprehensive framework for change managementin the legal department and throughout the enterprise are absolutely essential to achievinghigh adoption (and therefor successful implementation), and adapting as evolving needs(e.g., leveraging software to manage more contract lifecycle phases) scale with departmentand company size.

TOP 10 INDUSTRYSECTORS OF SURVEYRESPONDENTS3Healthcare /Oil, Gas, andEnergy1ProfessionalServices2Banking and/or Lending5Insurance46TechnologyReal Estate ity,Airlines, andTransportation10RetailRESPONDENTS BY COMPANY’SANNUAL REVENUE35%34%Annual revenue less than 4.99M16%Annual revenue between 1B to 4.99BAnnual revenue between 50M to 999.99M14%Annual revenuemore than 5B

RESPONDENTSBY DEPARTMENTBUDGETS4%3%Budget between 5M to 10MBudget ofmore than 20M7%Budget between 2M to 5M15%Budget between 1M to 2M5%64%Budget between 10M to 20MBudget of less than 1MRESPONDENTSBY LEGAL SOFTWAREBUDGET16%Budget between 10,001 and 20,00052%Budget of less than 10,0006%Budget ofmore than 250,0008%Budget between 50,001and 100,00011%Budget between 20,001 and 50,0007%Budget between 100,001 and 250,000

RESPONDENTS WHO USE FORMALCONTRACT LIFECYCLEMANAGEMENT SOFTWARE22USE%CLM Software%87DON’TUSECLM SoftwareFor one or more of the followingphases of CLM: Contract Request Preparation/Drafting/Assembly Review/Negotiation/ Redlining Approval Execution Storage Records Management9.8%Contract Insightby CobblestoneSoftware19.6%Apttus ContractManagementby Apttus14.6%4.8%Legal Suite9.8%OnBase by HylandDocuVantage OnDemandby Document Advantage4.8%4.8%Contract Assistantby Blueridge SoftwareLegal Tracker,formerly SerengetiLegiswayWHICH CLMSOFTWAREDOES YOURCOMPANYUSE?4.8%Conga Contractsby Conga14.6%14.6%Universal Contract Managerby iContracts4.8%ContractExpressby Thomson Reuters4.8%Contract Logixby Contract Logix4.8%Lextreeby Berkman Solutions

COMPANIES WHO USE CLM SOFTWAREBY NUMBER OF EMPLOYEES13%use CLMsoftware53%18%38%use CLMsoftware27%14%use CLMsoftwareof respondentshave more than10,000 employeesof respondents have1,001 to 5,000 employeesof respondentshave less than500 employees32%28%use CLMsoftwareof respondents have501 to 5000 employees29%use CLMsoftware5%of respondents have5,001 to 10,000 employeesCOMPANIES THAT USE CLM SOFTWAREBY LEGAL DEPARTMENT SIZE12.5 Years The Average Experienceof Legal Departments that use CLM software

NUMBER OF LEGAL SOFTWARE USERS PER s159%11-2021.4%SoftwareUsersrespondents said they werevery likely to recommendtheir software to someone else20SoftwareUserscompanies have been using software forless than 5 years

NUMBER OF CONTRACTLIFECYCLE PHASES IN WHICHFORMAL CLM SOFTWAREIS USED57%Two to Five Phases14%29%One Phaseat least Six PhasesCURRENT NUMBER OF RESPONDENTSWHO USE CLM SOFTWAREBY PHASEFormalFORMAL40.40%Contract Request66.70%Preparation/Drafting33.80% /AssemblySearching/Retrieving64.90%Contract RequestRecords alytics40.40%Renewal/DispositionRespondents selected all phaseswhere formal/informal CLM softwarewas employed.

MOST COMMON USESOF INFORMAL CLMSOLUTIONS FOR THOSEWHO USE FORMALSOFTWARE IN 1 ORMORE OTHER PHASES61%Use informal software forPreparation Phase55%Use informal software forReview Phase18%Use informal software forAlerts Phase39%18%Use informal software forRenewal Phase24%27%Use informal software forStorage PhaseUse informal software forSearching PhaseMOST COMMON PHASESWHERE CLM SOFTWAREIS USED, BY DEPARTMENTSOFTWARE/LEGALTECHBUDGET21%Use informal software forAudit hing86%78%Storage100% 6%Execution6%Useinformal software forOther PhaseUse informal software forApproval Phase27%Use informal software forRecords Phase36%Use informal software forExecution rching100%RecordsSearchingStorageBudget less than 10,000Budget between 10,001–to 50,000Budget between 50,001– 250,000Budget more than 250,000

MOST COMMON PHASES WHERE CLM SOFTWAREIS EMPLOYED, BY DEPARTMENT SIZE80%Storage75% 60%SearchingAlertslegal department size betweenup to 10 members100%Searching89% 78%RecordsStoragelegal department size between11 to 50 members100% 100% 100% 100% %Executionlegal department size between51 to 200 membersApproval75%Renewal

67%Ease of UseMOST IMPORTANTFACTORS IN CHOOSING55%CLM SOFTWAREDepth of Features/Functionality58%Price36%Breadth of Features/FunctionalityONLY29%rated the process of learninghow to use their softwareas easy and intuitive26%33%were very satisfied withthe overall quality of thevendor’s customer serviceReliability18%API Feasibility9%were very satisfiedwith training by the vendorMOST IMPORTANTFUNCTIONALCATEGORIES INCHOOSING CLMSOFTWARECustomer Supportsaid their software requiresat least 21 hours a weekof administrative time to maintain27%AutomatedWorkflowONLY47%27%said legacy contractsand metadata were migratedinto their new systemby the vendorCustomizability24%24%Data andDocument Relation Easy DocumentStorage21%ContractPreparation18%Task hFunctionality15%AccessControlsONLY15%Trackingand Alerts21%of respondentsconsideredONBOARDINGto be good

TOP APIs CONSIDEREDMOST IMPORTANT FOR INTEGRATIONWITH CLM SOFTWARESalesforceDocusignOther(Legal Suites, Box,BaseCamp, Navex,PeopleSoft)MicrosoftOffice Applications68%of respondents answeredthat CLM software wasCUSTOMIZABLE to meettheir needsrespondents indicated that vendor was willingto make changes or customizationsof respondents rated their vendor’s ability,speed and effectiveness with respect to makingchanges as excellent

MOST IMPORTANT FEATURE OR FUNCTIONALITY WHERECLM SOFTWARE IS EMPLOYED, BY DEPARTMENT SIZE20%AccessControls25%Data andDocument Relation30%ContractApprovals20%25%Easy DocumentStorageand l department size betweenup to 10 4%legal department size betweenAutomatedWorkflow22%Task and WorkflowManagement33%Data andDocumentRelation33%33%ContractApprovals21 to 50 %Task andWorkflowManagement25%25%Easy DocumentStorage andOrganizationalFunctionalityIntegration withInternal SystemsData andDocumentRelation50%ContractApprovalslegal department size between51 to 200 membersContractAnalytics

MOST IMPORTANT FEATURES ORFUNCTIONALITY OF CLM SOFTWAREBY TOTAL NUMBER OF EMPLOYEES10%Access Control 20%Wolters10%Kluwer InfographicsContractAnalyticsData & DocumentRelations10%17%17%Data & DocumentRelationsAccess Control30%17%Search17%Tracking & Alerts17%Integration withInternal Systems17%Easy Document StorageAutomated Workflow& OrganizationalFunctionalitywith less than10%with500employees10%Tracking & Alerts501 to 1,000employeesTask & WorkflowManagementEasy DocumentStorage& OrganizationalFunctionality38%Access Control29%14%Contract Analytics14%50% 5,001 to 10,000AutomatedWorkflow14%Contract Approval& ExecutionwithIntegration withInternal Systems14% 1,001 to 5,000Data & w14%employees50%Contract Approval& Execution13%Task & WorkflowManagementEasy Document Storage& OrganizationalFunctionality25%Data & DocumentRelationswith10,000employeesTask & WorkflowManagementor moreMOST IMPORTANT CLM SOFTWARE PURCHASEDECISION FACTORS, BY RESPONDENTS’ LIKELIHOODTO RECOMMEND THEIR CLM SOFTWARETO A COLLEAGUE20%67%17%Breadthof Features/FunctionalityEase of Use17%ReliabilityBreadthof Features/Functionality27%Breadth ofSomewhatLikely toRecommendPriceDepth ofFeatures/FunctionalityRecommend Against18%Features/FunctionalityVeryLikely toRecommend20% 40%Ease of Use45%Price9%Reliability20%48%Securityof respondents said their singlegreatest obstacle to achieving adoptionof CLM software issues was changemanagement challenges.

REPORT CONTRIBUTORSBrian Kudowitz currently leads the CorporateLegal Department Products portfolio at WoltersKluwer U.S. Legal & Regulatory. He has beenfeatured in media outlets, including LegalTechNews, InformationWeek, and the New York LawJournal, speaks at legal industry events on avariety of issues. He has also been named aNational Law Journal Cybersecurity and DataPrivacy Trailblazer. Brian earned his law degreefrom Washington University School of Law andis a member of the New York Bar. He also has aB.S. in materials engineering from RutgersUniversity.Wolters Kluwer Legal & Regulatory U.S. is atrusted source for expert content and solutionsin the areas of law, corporate compliance,health compliance and reimbursement, andlegal education. Our authoritative expertise isunparalleled, bringing the insight ourcustomers need to interpret today’s complexrules and regulations in the way that is mostrelevant to them. Best-practice resources—forexample, effacts—are available fromwww.effacts.com/us/ To learn more about howto harness the power of effacts, contact theeffacts sales team.Dr. Greta Zeimetz, CAE, is the CEO of theNational Association of Legal Assistants, Inc.(NALA), a position she has held since 2015.Prior to NALA, Dr. Zeimetz was the Director ofEducation & Research of an association. Sheearned her Doctorate in Business Managementin 2019 and holds an M.S. in Management &Organizational Behavior and a B.A. inCommunications. Dr. Zeimetz is a publishedauthor and a frequent speaker at conferencesand meetings. She is a member of AmericanSociety of Association Executives (ASAE) andserves on its Executive Management SectionCouncil.NALA is the leading paralegal association in theU.S. NALA provides current information aboutthe profession, continuing education programs,networking opportunities, professionalcertification programs, occupational surveyreports, and publications to help paralegalsexcel in the workplace. NALA is a non-profitorganization, 501(c)(6), representing more than18,000 paralegals, who are individual membersor members of NALA affiliated associations.CONTACT DETAILS FOR FURTHER INFORMATION ABOUT WOLTERS KLUWER AND NALAWolters Kluwer Legal & Regulatory U.S.: To learn more, contact your sales team at usinfo@effacts.com

Legal Tracker, formerly Serengeti 14.6% Contract Insight by Cobblestone Software 9.8% OnBase by Hyland 9.8% Legal Suite 14.6% 19.6% Conga Contracts by Conga 4.8% Contract Assistant by Blueridge Software 4.8% ContractExpress by Thomson Reuters 4.8% Contract Logix by Contract Logix 4.8% DocuVantage OnDemand by Document Advantage 4.8% Lextree by .