I read an interesting article on the origin of the brown M&M clause in Van Halen’s concert contracts at snopes.com. Van Halen’s standard contract would specify that a bowl of M&Ms should be provided backstage, with all the brown M&Ms removed. The reason was that Van Halen used this clause as an easy way to test whether the contract had been read and executed with sufficient attention.

Probably not  an everyday occurrence for most contracts, but it made me think about the processes that need to be put in place to ensure that contractual obligations are fulfilled. It is a different type of compliance issue (business compliance instead of regulatory compliance) – but still is an operational risk issue.

Even a relatively simple contract requires a lot of management, tracking and followup to make sure the terms are met. This process is another example of  an ad-hoc, unstructured human process that would be significantly enhanced by using a human process management system like ActionBase.

The way we would handle it is to have to have the contract owner assign the different clauses to the appropriate people directly from the contract document, and provide the owner a way to track and understand where the implementation of any process related to any clause stands. We can help make sure the brown M&M’s are removed, and if not, at least let you know why.