By Mark Cooksey
In my previous Biomed 101 “Using AI to Negotiate Smarter HTM Service Contracts,” I described how artificial intelligence (AI) helped our team evaluate more than 160 service contracts, benchmark pricing, strengthen vendor negotiations and contribute more than $750,000 in documented savings. Since that article was written, our projected savings have surpassed $1 million.
Those results were significant. But as often happens in Lean Six Sigma projects, solving one problem simply revealed the next opportunity. Negotiated savings only become real savings when contracts are executed.
As our team became more efficient at contract analysis and negotiations, a new challenge emerged. Contracts were getting negotiated faster, but they were not getting finalized any faster. The bottleneck had moved.
AI fundamentally changed how we approached service contract renewals.
Instead of manually reviewing every proposal, we used AI to:
• Summarize contract language
• Compare service coverage
• Draft vendor responses
• Create leadership summaries
• Analyze pricing against ECRI benchmarks
Reviews that once required days could often be completed in minutes. Negotiations became more consistent, leadership gained better visibility into risk and costs, and our team shifted from passive renewals to active contract management.
We found ourselves in an unusual situation. Vendors were responding faster. Negotiations were closing faster. Leadership was making decisions faster. Yet contracts still seemed to disappear into a black hole after submission.
Overall cycle times remained stubbornly long. Vendors were constantly asking for status updates to submitted proposals. We had done our due diligence internally and forwarded proposals to our legal department for final review and approval.
The bottleneck was no longer clinical engineering. The bottleneck was no longer the vendor. The bottleneck was contract execution.
Rather than speculate, we followed a core Lean principle: Genchi Genbutsu, which means “go and see for yourself.” I scheduled a meeting with Norton’s lead corporate contract attorney to walk through the process step-by-step. I thought I knew what happened after clinical engineering submitted a contract for review. I didn’t.
Within minutes of our face-to-face meeting, it became clear that legal viewed contract renewals very differently than we did. Clinical engineering saw a renewal as an extension of an existing agreement. Legal often saw it as a completely new contract and that distinction changed everything.
From our perspective, the equipment, service scope, pricing structure and vendor relationship frequently remained the same. From legal’s perspective, the vendor’s proposal arrived as a brand-new document filled with standard terms and conditions that required review. Every renewal initiated a lengthy review process.
What we initially viewed as a legal bottleneck turned out to be a process design issue.
The issue wasn’t Legal.
The issue wasn’t the vendor.
The issue was the process.
That realization led us to ask: What would allow contract renewals to move through legal more quickly without increasing organizational risk?
The answer became one of the most impactful process improvements we have implemented. Legal introduced what our team now jokingly calls the “Magic Bullet.”
The solution was a contractual tiebreaker known as a notwithstanding clause. Think of it as a contractual override switch. This simple clause establishes that when a conflict exists between a previously approved Master Services Agreement (MSA) and a new renewal proposal, the previously negotiated MSA remains the controlling agreement.
A simplified example looks like this: “Notwithstanding anything to the contrary contained in this proposal, quotation, renewal, amendment, or vendor standard terms and conditions, the parties agree that Master Services Agreement #XXXX dated XX/XX/XXXX shall remain the controlling agreement.”
The concept was elegantly simple. Vendors could continue using their standard contract templates. Norton retained the protection of previously negotiated terms and conditions. Legal could focus on actual business changes instead of rereading boilerplate language that had already been negotiated and approved.
Instead of reviewing every page, legal could focus on:
• Pricing changes
• Coverage changes
• Equipment additions
• Service-level modifications
• Material business risks
Everything else defaulted back to the approved MSA. Everybody won.
That conversation became the foundation for what we now refer to as the Fast Pass Process.
Under Fast Pass, qualifying renewals follow a structured path:
1. Reference the previously executed master service agreement.
2. Include approved notwithstanding language.
3. Identify pricing changes.
4. Highlight coverage modifications.
5. Document any exceptions.
6. Limit review to changes beyond the MSA.
For the first time, renewals could be treated like renewals rather than entirely new contracts.
Now AI helps accelerate the final approval process. It helps us compare current and prior agreements and identify “Fast Pass” contracts. It helps create executive summaries and highlight changes. It also helps draft communications to legal and vendors. And, it supports insertion of approved notwithstanding language.
Rather than requiring stakeholders to sort through dozens of pages of contract language, AI helps everyone focus on the handful of items that actually changed. This follows another important Lean principle: “Experts should spend their time managing exceptions, not repetitive work.”
One of the first lessons I learned as a Lean Six Sigma practitioner and coach was simple: don’t assume you know the process – go see it for yourself.
When our contract review cycle remained stubbornly high, I initially assumed the delay was somewhere in the legal department. The reality was different. Legal wasn’t the problem. The vendors weren’t the problem. The process was the problem.
AI helped us negotiate smarter and identify a new bottleneck. The breakthrough happened when we sat down face-to-face with our legal team and asked a simple question: “What would help move these renewals faster without increasing risk?”
That conversation led to a solution that reduced review turnaround time by 70%.
The lesson wasn’t really about AI. It was about collaboration.
Too often, we view departments like legal, finance, supply chain and IT as approval steps rather than process partners. When we take the time to understand their challenges, constraints and objectives, we often discover opportunities that would otherwise remain hidden.
AI may have helped us find the opportunity. A conversation helped us solve it.
And sometimes that’s where the most meaningful improvements begin.
