The Contracting Parameters Station defines the operational boundaries, thresholds, and scope of legal involvement in the contracting process. It is the rulebook that determines when legal must be involved, what positions must be achieved, and how far a managed legal service (MLS) provider can go without escalation.

In the context of MLS, contracting parameters are essential. They allow the provider to operate with confidence, knowing exactly what outcomes they must deliver and where the red lines are. Without these parameters, the MLS provider is forced to guess - and that’s a recipe for inefficiency, risk, and rework.

At GLS, we treat contracting parameters as a strategic calibration tool. They are not just about risk containment - they are about enabling transformation. By defining the legal positions that must be achieved, we can build upgraded assets (e.g. clause banks, playbooks, AI review tools) that optimise the entire contracting function. This is how we turn low-to-medium risk contracting into a high-performance legal engine.

Contracting parameters also serve as the interface between legal and the business. They clarify when legal must step in, when the business can self-serve, and when the MLS provider can act independently. This clarity is what makes scalable, efficient, and defensible delegation possible.

The scope of the Contracting Parameters Station typically includes:

◼️Risk Thresholds: Defining what levels of legal, commercial, or regulatory risk require legal team involvement.

◼️Contract Type Categorisation: Classifying contracts by complexity, value, and risk to determine handling protocols.

◼️Delegation Rules: Outlining what the MLS provider can handle independently and what must be escalated.

◼️Position Requirements: Specifying the legal positions or outcomes that must be achieved in each contract type.

◼️Escalation Triggers: Identifying red flags or exceptions that require legal team intervention.

◼️Tool Calibration: Aligning clause banks, playbooks, and AI tools with the defined parameters.

◼️Business Enablement Rules: Defining when and how the business can self-serve or use pre-approved templates.

◼️MLS Integration Points: Mapping how the parameters are operationalised within the MLS workflow.

In GLS legal ops speak – the Contracting Parameters is considered a “Foundational” resource within the process ecosystem of an in-house legal team.

The Foundational Resource is a CRE that is responsible for determining the overall performance capabilities of a “critical” legal function. If it is not optimised, the function can never be optimised. 

The best practice features of the Contracting Parameters Station are as follows:

◼️Risk-Calibrated Thresholds: Clearly defined risk levels that determine legal involvement.

◼️Contract Taxonomy: A structured classification of contract types to guide workflow routing.

◼️Pre-Approved Legal Positions: Standardised fallback positions and negotiation boundaries.

◼️Escalation Protocols: Clear rules for when and how to escalate to internal legal.

◼️MLS-Ready Design: Parameters are structured to be easily adopted by managed service providers.

◼️Tool Alignment: Clause banks, playbooks, and automation tools are built around the parameters.

◼️Business Self-Service Enablement: Empowers the business to handle low-risk contracts independently.

◼️Continuous Feedback Loop: Parameters are reviewed and refined based on performance data and legal outcomes.

The Contracting Parameters Station delivers the following value to the Business:

◼️Faster Contract Turnaround: Clear rules reduce delays and unnecessary legal involvement.

◼️Reduced Legal Spend: Enables targeted use of legal resources and MLS providers.

◼️Improved Risk Management: Ensures consistent application of legal risk thresholds.

◼️Scalable Contracting: Supports high-volume contracting without compromising quality.

◼️Empowered Business Users: Allows commercial teams to operate with greater autonomy.

◼️Fewer Bottlenecks: Reduces dependency on internal legal for routine matters.

◼️Better Vendor Performance: MLS providers operate more efficiently with clear boundaries.

◼️Accelerated Deal Velocity: Contracts move faster through the pipeline with fewer roadblocks.

The optimisation of this Station will build value in the legal department in the following ways:

◼️Clarity of Role: Legal knows exactly when and where to engage in the contracting process.

◼️Reduced Low-Value Workload: Frees up legal resources from routine, low-risk matters.

◼️Improved Delegation Confidence: Legal can delegate to MLS providers without fear of misalignment.

◼️Better Use of Tools: Clause banks and playbooks are more effective when aligned with clear parameters.

◼️Enhanced Stakeholder Trust: Business units understand and respect legal’s role and boundaries.

◼️Data-Driven Oversight: Parameters enable better tracking of contract performance and risk exposure.

◼️Fewer Escalations: Well-defined rules reduce unnecessary interruptions and rework.

◼️Foundation for Automation: Parameters provide the logic needed to automate contract workflows.

The Contracting Parameters Station is essential for:

◼️Legal departments deploying managed legal services

◼️Teams seeking to optimise their contracting function

◼️Legal operations professionals designing scalable workflows

◼️GCs and Heads of Legal aiming to reduce legal bottlenecks

A legal team operating without a Contracting Parameters Station will face a wide range of inefficiencies including:

◼️Inconsistent Contract Handling: Different teams apply different standards, increasing risk.

◼️Overloaded Legal Teams: Legal is pulled into low-value work that could be delegated.

◼️Poor MLS Performance: Providers operate without clear guidance, leading to misalignment.

◼️Slower Deal Execution: Contracts stall due to unclear thresholds and approval paths.

◼️Increased Legal Spend: Resources are wasted on matters that don’t require legal input.

◼️Stakeholder Frustration: Business units are unclear on when and how to engage legal.

◼️Tool Underperformance: Clause banks and automation tools are ineffective without clear parameters.

◼️Transformation Delays: Lack of structure hinders legal process improvement initiatives.

The Contracting Parameters Station has a strong tech profile:

◼️Automation Enablement: Parameters provide the logic for contract triage and routing.

◼️Tool Calibration: Clause banks, playbooks, and AI tools are aligned with defined thresholds.

◼️MLS Platform Integration: Parameters are embedded into the MLS provider’s workflow tools.

◼️Self-Service Portals: Business users can access pre-approved templates based on contract type.

◼️Performance Analytics: Parameters enable tracking of contract cycle times, escalations, and risk exposure.

◼️Contract Lifecycle Management (CLM): Parameters drive workflow rules and approval chains.

◼️Data Governance: Ensures consistent metadata tagging and document classification.

◼️Scalability: Tech platforms can scale more effectively when guided by clear contracting rules.