Top 10 causes of value leakage

IACCMs research has identified the top 10 causes of contract value leakage – on average most organisations can lose over 9% of their overall contracts’ value through these 10 pitfalls. CTA colleagues can help you to address the root causes of value leakage – not just the symptoms.

1

Lack of clarity on scope and goals

Result: Cause of claims/disputes

2

Legal/contract team not involved early enough

Result: Wrong form of contract & extended lead time

3

Failure to engage stakeholders

Result: Misaligned interests and future opposition

4

Protracted negotiations

Result: Competitive exposure & delayed revenues

5

Negotiations focus on the wrong terms and risks

Result: Loss of economic benefit; contract a weapon

Average value
erosion 9.2%

6

Contracts lack flexibility. Insufficient focus on governance

Result: Performance management dominated by blame/fault

7

Contracts difficult to use or understand

Result: Users see contract as irrelevant to business needs

8

Poor handover from deal team to implementation team

Result: commitment & obligations missed & misunderstood

9

Limited use of contract technology

Result: Inefficiency and loss of quality in performance and analysis

10

Poor post award processes and governance

Result: Repetitive issues and errors causing value loss