Home Runs to Handshakes: What Can Businesses Learn From the Largest Contract in Professional Sports?

15 years, $765 million, and a record-shattering contract. There aren’t many headlines in professional sports that could have made a bigger splash. These staggering numbers highlight the monumental contract between Dominican Major League Baseball (MLB) prodigy Juan Soto and the New York Mets.

Soto’s contract eclipsed Shohei Ohtani’s $700 million deal with the Los Angeles Dodgers, but the accurate picture lies underneath the cash straps. Months of negotiations, meticulous financial planning, and extensive legal reviews — these elements are the cornerstones of this landmark deal. These aspects also significantly contribute to Patrick Mahome’s National Football League (NFL) legacy and Cristiano Ronaldo’s illustrious career. 

Here’s why these elements matter to your business.

From securing crucial partnerships to negotiating vendor terms, the nuances behind colossal sports deals mimic the hardships of corporate deals and agreements. Just as expertise and precision are key to securing a win-win sports deal, organizations need a contract lifecycle management (CLM) solution to systematize negotiations, compliance, and risk management. 

Let’s explore the essential elements of this historic sports contract and how it can help businesses excel in contractual relationships with CLM.

Short-Term Agility Driven Long-Term Vision

Soto’s long-term commitment doesn’t just exemplify the Mets’ confidence in his resilience — it also demands flexibility that adapts to changing circumstances. It factored in the possibility of potential trade-offs or MLB revenue structure revisions. 

Similarly, enterprise agreements that span years must include provisions for organizational pivots, market shifts, or regulatory changes. A CLM platform offers customizable templates, compliance adherence, and fully automated processes that help organizations make strategic business decisions. It allows businesses to create future-proof contracts while enhancing their operational flexibility. 

Performance-based Incentive Mechanism

The contract includes opt-out clauses, performance bonuses, and zero payment deference — stipulations prioritizing excellent performance while minimizing risk. Incentives or sanctions attached to metrics, delivery milestones, or service level agreements (SLAs) serve an identical purpose in organizational contracts. 

With CLM platforms, stakeholders can effectively add contingency scenarios to contracts and enable automated tracking for every anomaly. Like a manager tracking players’ stats, a CLM tool offers accountability without manual intervention in crucial tasks like drafting and monitoring a vendor’s performance incentive in real time.  

Turning Collaboration Into Competitive Advantage

Professional sports deals demand alignment among agents, managers, team owners, league officials, and financial advisors. Enterprise contracts require an identical collaboration between legal, finance, procurement, and operations across continents and time zones. CLM solutions remove siloed processes and deliver advances like version control, audit trail, and centralized negotiation platforms, ensuring all parties are on the same page. 

Proactive Risk Mitigation

When drafting the contract, the Mets’ legal team accounted for unforeseen circumstances or worst-case scenarios, such as injuries, slumps, or league rule revisions. Parallel risks threaten lucrative enterprise deals — cybersecurity breaches, supply chain disruptions, regulatory transgressions, etc. CLM tools minimize these risks by identifying, prioritizing, and centralizing potential contract risks with detailed assessments. 

Data-Driven Decision-Making

Beyond the numbers, data had a massive impact on Soto’s contract — analyzing past trends, performance metrics, and untapped potential. While modern-day enterprises have large amounts of data, it remains unutilized due to a lack of solutions. A CLM solution helps organizations visualize, segregate, and analyze contract information and offers actionable insights that encourage smarter decision-making. 

Setting The Tone for Comprehensive Contract Management

Contracts like these don’t just set new benchmarks in MLB — they highlight the game's upcoming talents. They are testaments to franchise owners' commitment to investing heavily in nurturing competitive teams. More than just a sports story, Juan Soto’s contract symbolizes modern negotiation, risk management, and strategic alignment. With CLM solutions, organizations can build their contract management operations on these similar principles that secured Soto’s legacy. 

Doqfy's CLM solution can help you take a leaf out of the world’s leading sports franchises’ contract playbook.

Booka a demo now to explore how our all-encompassing, automated contract management platform makes contract management workflows a breeze.