We grow because we stay ahead of our members and offer hope and aspiration for the future. This is a fundamental attribute that we must not lose.
A shift to ‘influencing and advocacy’
In 20 years, IACCM has grown from a handful of participating companies to a truly global organization with over 65,000 members. Yet there is still so much more to do.
Commercial and contract disciplines have always struggled to achieve the balance between their legal and compliance role and their contribution to economic value and financial returns. Market volatility and changing needs to provide social value and sustainable outcomes, to be transparent, fair and reasonable, has made this struggle even more pronounced.
We will continue to work on providing our growing community with the material and insights that support them in their roles and in their promotion of contract and commercial excellence within their organizations. We will also continue our efforts to inform and inspire senior management, however we now believe that the time has come to supplement these ‘push’ and ‘pull’ strategies with a growing focus on advocacy.
Our commitment to our members
In the Vision and Mission section of this Strategy we set out how we fulfil our Mission and seek to achieve our Vision.
- Raising Awareness (research, publications, communications, public speaking and working groups)
- Increasing Insight (events, member networking, benchmarks, analytics, education and inspiration)
- Creating Standards (certification, models, working groups)
- A Strong Team (a core team and a network of partners)
1. Raising Awareness
Our reputation for thought leadership, responsiveness and in-depth expertise are sources of competitive advantage.
As the only global association focused on contract and commercial management, from inception World Commerce & Contracting has been a ‘thought leader’ in its field. Over the past 20 years we have worked tirelessly on building a practitioner community, supported by robust research and resources, helping them to raise awareness of the potential value achieved from this discipline.
We will continue to provide and evolve services and offerings that meet the needs of our membership to support their growth and to put in place a robust marketing plan that helps us to continue to generate the association’s core revenues.
Increasingly we have recognized the need to advocate at a different level, including working more closely with industry bodies, NGOs, academia and working groups. Our involvement in these sort of activities raises awareness of the importance of commercial competence from a different standpoint allowing our members and their management to view the role with a different lens.
2. Increasing Insight
We aspire to create a sustainable global membership, inspiring and empowering individuals through the member networking that we facilitate including conferences and events, the education that we provide and the research, benchmarks and analytics that our members can gain access to.
To achieve our Mission, we actively encourage, support and serve a diverse range of markets and interest groups where knowledge sharing is paramount.
3. Creating Standards
We created the world’s first common body of knowledge to support coherent and consistent definitions around the disciplines of Commercial Management and Contract Management. This body of knowledge has led to globally recognized certification programs which support fulfillment of our Mission.
We have been at the heart of some early successes, with initiatives in areas such as the development of contract standards, the promotion of contracting principles, the emergence and uptake of user-based design for contracts and the movement for increased transparency. The forces driving these changes are in part ethical in nature, but more often they are due to a growing appreciation of the economic advantages that accompany increased efficiency and the potential competitive advantages of brand integrity. New technologies underpin this shift and will create added momentum. Our role is as instigator, catalyst, developer and advocate of these emerging standards and practices.
We have previously discussed the opportunity to become a standard-setting body in terms of industry standard agreements and this is a significant part of our strategic focus, building on existing activities and achievements around Contract Design, Standards and Contracting Principles.
4. A Strong Team
We will continue to foster a highly committed, strongly motivated and appropriately rewarded team.
We will ensure efficient processes and an organizational design that delivers at scale and secures high levels of member engagement.
We will make effective use of advanced systems and software to support all aspects of our work including global reach.
We will maintain a sufficient body of credible and influential experts and thought leaders that the association can deploy to promote and lead delivery of major projects and change initiatives.
Viewing Contract and Commercial Management through a new lens
Rather than designing for mutual benefit, contracts are more often used as instruments of power and control.
Our research indicates that contract terms are typically penal in nature – we contract for the divorce rather than the marriage – and they are complicated to understand. They often reflect commercial policies and practices that are defensive and risk-averse in nature, even though market and economic conditions demand different approaches, approaches that are flexible, adaptive and creative.
In addition, contracting and its related policies and practices, whether looked at from a buy or sell side perspective, remains one of the least reformed business processes. This is due in large part, as already indicated, because contracts are viewed as instruments of risk transfer and control.
Transforming contracting will generate increased economic wealth, it will support higher ethical standards, transparency and it will encourage commercial innovation. To achieve this purpose, we must convince business and political leaders of these benefits and the feasibility of this transformation and we must energize and upskill those who are responsible for contract creation and management.
Relationship Resource Planning
In every commercial relationship, the parties operate within a governance framework, sometimes unconsciously and other times with a great deal of planning, negotiation and documentation. Determining and then operating this framework is Relationship Resource Planning (RRP) – the series of processes and commercial practices through which the parties interact and conduct their trade. The efficiency of RRP has a major impact on the cost, quality and speed of the associated trade.
RRP governs interactions between trading partners. It establishes the what, why and how of their relationship, supporting data flows, communications, risk and opportunity analysis and resolution, performance management through resource availability or allocation.
All trade is by its nature relational. The formality that surrounds the governance of that relationship varies. It may or may not include a physical contract. In some cultures, it is managed through reputation and familiarity with the other party. Increasingly, however, it is at least in part managed through contracts. When performance is especially complicated or spread over a long period of time, requiring the commitment of significant resources, its management will be undertaken through the formal contract, supplemented by a traditionally less formal concept of ‘relationship management’.
As we have already observed, trade lies at the foundation of human society, underpinning economic wealth and social wellbeing. It takes many forms – goods, services, intellectual property, ideas. Every form of trade is accompanied by a relationship (between the affected parties), obligations (associated with what each party will do) and rules (laws, regulations and social norms). There is variation in how relationships, obligations and rules are managed. On some occasions, such as when buying goods from a store, they are so well established that the rules and obligations are assumed and ‘the relationship’ may simply be fleeting. But as we go up the spectrum of value and when we see potential for risk, the level of formality increases.
In this context, all contracts are in fact relational, operating as one governance option in a spectrum of commercial relationships. As we move across that spectrum, the extent of required formality grows.
Ethics and Social Value
At both a social and political level, there has been a steady growth of focus on the ethical and social values demonstrated through an organization’s sense of purpose and its commercial practices. The association and its members clearly have a role to play in responding to this trend.
We have already started to engage in initiatives in this field. Part of our role will be to educate and support our members – for example, how to define, measure and contract for social value. In other areas, such as visibility into the integrity of supply ecosystems, our research will identify and promote good practice. Another key aspect is the extent to which the association may operate as an intermediary for members who have concerns over the ethical practices they observe within their industry or company, becoming an advocate on their behalf.
This latter possibility requires thoughtful consideration and planning, as does the potential role that the association is being asked to fulfill on semi-regulatory bodies.