1. A Meta-model for e-Contract Template Variable Dependencies Facilitating e-Negotiation Dickson K.W. CHIU Dept. of Computer Science & Engineering, Chinese University of Hong Kong kwchiu@acm.org, kwchiu@cse.cuhk.edu.hk Shing-Chi CHEUNG Dept. of Computer Science Hong Kong University of Science & Technology scc@cs.ust.hk Patrick C.K. Hung Dept. of Management Sciences University of Waterloo ckphung@engmail.uwaterloo.ca

2. ER2002-2 Introduction e-Contract computerized facilitation or automation of a contract cross-organizational business process Negotiation a decision process in which two or more parties make individual decisions and interact with each other for mutual gain e-Negotiation perform negotiation activities over the Internet

3. ER2002-3 Contract Templates Reference document based on which a new contract is created Contains a set of template variables whose values are to be negotiated Particularly applicable to standard business interactions that could be taken place over the Internet Such as real-estate transactions, purchase and sale of goods, etc. New e-Contracts for these business interactions can be defined based on standard contract templates Specific business interactions not covered by the clauses in standard contract templates can be provided as contract variations or contract escalations Tenant is required to pay landlord [ ] months’ deposit, amount to [ ], which is refundable without interests upon contract termination on the condition that …

4. ER2002-4 Motivation and Objectives e-Contract template and template variables facilitate negotiation by avoiding uncontrolled openness of issues Address specific semantic requirement of contracts for supporting B2B applications Reduce cost and improve effectiveness of negotiation (avoid combinatorial explosion of issues) Development of an effective and efficient negotiation plan in a natural way Rapid development and deployment of a flexible negotiation support system (NSS) through reuse

5. ER2002-5 Overall Meta-modeling Approach Based on business experience and requirements, contract templates (with variables) are abstracted from previous contracts A contract template is modeled as an e-Contract template Determine template variable relations (dependencies) Derive e-Negotiation plan Execute the e-Negotiation plan with a NSS Each successful e-Negotiation will lead to an e-Contract

6. ER2002-6 Meta-Model of an e-Contract Template e-Contract Template * 1 1..* Template Variable indivisibly relates to * * 2..* involves * set values to ObligationPermissionProhibition * * precedes e-ContractParty concerns Contract Clause references

7. ER2002-7 A Lease e-Contract Template as an Instance of the Meta-model lease :e-Contract Template landlord :Party tenant :Party deposit payment :Contract Clause facilities inclusion :Contract Clause effective period :Contract Clause rent payment :Contract Clause deposit :Template Variable numOfMonths :Template Variable facilities provision :Template Variable lease period :Template Variable start date :Template Variable rent :Template Variable mgt fee payment :Contract Clause mgt fee inclusion :Template Variable precedesindivisibly relates to

8. ER2002-8 Motivating Example lease period facilities provision basic rent start date additional fee1 mgt fee inclusion additional fee2 Landlord Tenant rent deposit numOfMonths Relationships among variables Negotiated in a bundle, e.g., facilities provision, lease period and rent A partial order, e.g., rent and deposit Individually negotiated, e.g., start date, management fee inclusion Principle variables (e.g., rent) made up of parts called auxiliary variables Template Variable Auxiliary Variable indivisibly relates to * * 1 * factorizes into precedes * * analyzed by, say, real-estates agency Variable

9. ER2002-9 Conceptual Model of e-Negotiation and e-Contract

10. ER2002-10 Derivation of Negotiation Plan lease period facilities provision basic rent start date additional fee1 mgt fee inclusion additional fee2 Landlord Tenant rent deposit numOfMonths {facilities provision, lease period, basic rent} {start date, additional fee1} {management fee inclusion, additional fee2} {rent} {numOfMonths} {deposit} Partial ordering of variables (sets)

11. ER2002-11 e-Negotiation Process Meta-model in UML Activity Diagram How we carry out e-Negotiation in general … select e-Contract template derive variable relations define issues and criteria for each collection of co-related issue make offers & counter offers validate consistency formulate plan organize tasks all issues have been mapped [consistent] [inconsistent] creation of e-Contract [reach consensus on all variables] [quit]

12. ER2002-12 Make Offer and Counter Offer To be supported by a web-based NSS May be based on WFMS (e.g., E-ADOME) Negotiate: management fee inclusion, additional fee1 Negotiate: facilities provision, lease period, basic rent Negotiate: start date, additional fee1 Computes deposit Negotiate: number of months Compute rent

13. ER2002-13 NSS – Create Contract Template System administrator create new contract template by entering different contract template variables

14. ER2002-14 NSS - Grouping & Auxiliary Variables System administrator then input grouping and auxiliary variables

15. ER2002-15 NSS - Input Dependencies System administrator then input dependencies among groups / issues

16. ER2002-16 NSS - System Generates Plan System generate negotiation plan

17. ER2002-17 Future Work  Study of the general negotiation process (Chiu et al., PACIS 2002)  Users having different logrolling views (i.e., different negotiation plan in mind) (Cheung et al., HICSS 2003)  One-to-many contract negotiation  Ranking of different types of issues and criteria for logrolling issues (Hung, HICSS 2003)  Decision making to reach an optimal and stable state for negotiators (Nash equilibrium)  Study of e-Contract enforcement (Chiu et al., HICSS 2003)  Real-life negotiation practice

18. ER2002-18 Conclusions  An novel application of computer science techniques for a management problem  A novel approach of e-Negotiation of contracts based on e-contract template  A meta-model for e-Contract templates with the notion of template variables and their dependencies  A flexible meta-model for e-Negotiation processes  Derivation of effective and efficient negotiation plan  Facilitate rapid implementation based on workflow management systems (e.g., our E-ADOME WFMS), supporting the cross-organizational process via contemporary Internet technologies