Many different types of organisations can improve their contract management processes with user-friendly and flexible contract management solutions. To that end, we’ve looked at five key organisational roles – contract managers, in-house legal teams, and procurement, sales and compliance professionals – and their respective contract management challenges to find out how they can empower themselves with leading contract management software.
1. Contract managers
The benefits of contract management software
A manual contract management process can work – with limitations – for an organisation dealing with a few dozen contracts per year. However, once that number skyrockets into the hundreds or even thousands, contract management professionals really should consider the benefits of contract management software. Manual contract management practices involve:
- filing cabinets for paper documentation
- emails for task tracking
- various disjointed spreadsheets for version control
- ineffective and disorganised digital storage.
Key dates and milestones are easily missed with an inadequate task and alert system, leading to increased risk, contract lifecycle bottlenecks and reduced contract performance. With a document drafting system that relies on multiple people creating, reviewing and revising contract documents, time is wasted by:
- creating new documents
- downloading templates
- finding relevant information
- manually imputing data into a vast array of fields.
Insufficient contract tracking prevents an enterprise from reaching its goals because it:
- lacks cohesion and security
- causes delays
- puts organisations at operational and regulatory risk.
To make matters worse, when a contract is finally approved for signatures, manual signing practices are outdated and slow. This leads to delayed contract execution. Additionally, the direct and indirect costs resulting from paper-based processes, printing, wet signatures, administrative time wasted and mailing fees can easily spiral out of control.
Taking contract management to the next level
A unified and secure contract repository system helps contract managers optimise contract and document duties such as location, protection, organisation, searching and sharing. Additionally, audit trails provide an accessible, up-to-date record of contract version changes.
Contract workflow automation reduces contract lifecycle delays by notifying the right people at the right time with automatic alerts, task reminders and unlimited contract notifications. It helps track every stage of the contract lifecycle with collaboration, negotiation and approval management tools – cutting contract approval time, reducing bottlenecks and assigning accountability.
Contract management automation means contract managers can create timely, accurate and compliant contracts, documents and letters that merge approved data fields and clauses. An intuitive interface allows document versions and templates to be easily exported into standard file formats. Microsoft Word plug-ins expedite drafting and review. Intelligent contract tracking tools supply contract managers with:
- increased visibility
- a secure contract repository
- approved templates
- clause libraries for streamlined contract drafting
- performance insights
- improved collaboration
- full audit trails.
Consequently, contract managers see faster contract-to-close rates. Tracking for unlimited attachment types, pre and post-award tracking, compliance and audit tracking enables managers to smoothly adapt to evolving standards and processes.
Electronic signatures cut send-to-sign time up to 20%, saving time and money, providing enhanced signing security, and improving business relationships and visibility.
2. In-house legal teams
The challenges of legal contract management
Your in-house legal team faces a major challenge with the increasing volume and complexity of contracts. An inefficient contract management process makes the toughest contract management challenges for legal departments virtually impossible to overcome.
Template management and standardised clause libraries ensure the use of approved contract language and clause ownership. The assembly and secure storage of documents and versions make the most up-to-date versions of contracts, agreements, and documents readily accessible. Legal professionals have to negotiate with counterparties and stakeholders, while continuously engaging with multiple pre and post-approval contracts at the same time. And on the back end of a contract, signatures are needed, and the obligations and compliance of contracts tracked.
With all of the above occurring at once, while being managed by different members of a legal department, a decentralised and unsatisfactory contract management system with limited storage, limited security, and a lack of key date awareness makes successful legal document management nearly impossible – increasing the risk of:
- lost documents and versions
- compliance and security issues
- approval and signature bottlenecks
- a lack of storage space
- workflow task delays
- missed key dates and renewals
- reduced contract value.
Centralised legal document lifecycle management
With leading legal contract management software that automates the drafting and assembly of contracts, risk documents and agreements, legal teams can organise and centralise their contract management process. Document assembly is simplified with an automated system. An intuitive user interface with features such as quick search and MS Word integration allows for easy management and organisation of multiple document versions and templates. Document creation and contract drafting become smooth and efficient with collaboration tools built for the legal department.
With enhanced legal contract management software:
- system admins can configure rules and set user permissions for document management and document version access so that the right people are working on the right tasks
- back-and-forth negotiation and post-approval tasks are more efficient with tools such as online negotiation portals, searching and reporting, automatic email and calendar alerts regarding key dates and renewals, and contract version history
- compliance monitoring ensures contracts and agreements meet regulations
- a secure contract repository enables legal professionals to store, track, and search multiple contracts easily
- clause ownership keeps templates secured and reduces the loss of legal properties
- electronic approvals and e-signatures shorten contract-to-close rates.
3. Procurement professionals
Sourcing without contract management software inhibits successful procurement
Manual and paper-based procurement management methods leave companies at risk of elevated procurement costs, lost documents, delays in the completion of procurement lifecycle tasks, slow approval cycles, missed opportunities for discounts and uncontrolled costs. And an organisation’s reputation can sustain damage due to missed payment deadlines, insufficient vendor management, ineffective dispute resolutions etc.
Procurement strategies relying on manual procurement tools create a non-standard process that leaves businesses at risk of:
- bottlenecks in the procurement lifecycle
- costly bidding on contract records
- slow bid response collection
- missed opportunities for growth and savings
- redundant, error-prone data entry.
Take control of your procurement process with contract management software
Leading eProcurement software can help simplify the procurement lifecycle and avoid these issues. The right platform provides the necessary tools to meet procurement goals, offering:
- simplified maintenance and support
- reduced total cost of ownership
- in-office and remote access
- end-to-end spending, procurement and purchase tracking
- team collaboration
- intelligent and automated workflow
- automated bid adverts
- online bidding
- diversity and vendor insurance certificate tracking
- spend and cost comparison capabilities
- supplier ratings and scorecards
- electronic approvals and e-signatures.
4. Sales Professionals
Insufficient contract management results in revenue loss
Manual contract management processes result in a lack of transparency, order, and accountability relating to tasks and projects that financially impact an organisation – which leads to revenue leakage. In many cases, it is not the contracts themselves that are the culprit, but rather a company’s sell-side contract management process. There are many reasons contracts may lose revenue, such as:
- lack of contract visibility: Your sales team can spend too much time searching for contracts, failing to keep track of document versions and scrambling to track the status of contracts. The resulting bottlenecks give your clients the opportunity to find solutions to their challenges with your competition.
- a manual contract management system: An inadequate contract management process involving emails and spreadsheets hinders the sales process and limits the number of contracts an organisation can manage.
- poor contract performance tracking: If your company’s contract performance data requires manual collection, storage, and review naturally prone to human error, then it doesn’t support the contract analytics and reporting capabilities you need to drive revenue.
- insufficient risk and compliance management: If an enterprise lacks the visibility and automation that ensures obligations are met, then it can fall behind, fail to meet contract terms, and face penalties and fines.
- ineffective sell-side document management: A business’s sales process is broken if the team spends too much time drafting documents that are held up in legal review, causing them to miss key dates, renewals, or other revenue-boosting opportunities.
All of these result in revenue leakage that can mean lower profitability, decreased market share, underperforming stock, and less capital for growth, investments and innovation.
Stop contract revenue loss due to manual contract management
The key to reducing your organisation’s pattern of revenue-losing sales practices is improving your contract management process. Email, shared drives and spreadsheets will not suffice. A contract repository alone is a step in the right direction, but it’s not enough. To nip revenue loss in the bud, sales teams need to manage the entire contract lifecycle with contract management software. Leading contract management software can help sales professionals to:
- control document versions, updates, accessibility, and approvals with audit trails
- draft contracts quicker with approved clause libraries and templates
- provide transparency regarding contract performance with contract management reports
- complete tasks and meet milestones with automated calendar and email alerts
- take advantage of beneficial opportunities and reduce unintended renewals or cancellations with consistent negotiation, renewal, and cancellation process tracking and alerts.
5. Compliance professionals
Say goodbye to the hardships of manual compliance management with contract management software
Manually working with hundreds or thousands of different contracts and documents and overseeing obligations, terms and conditions, regulations, committals, and expectations is extremely inefficient. Handling compliance management manually without significant challenges is virtually impossible.
Human error is inevitable, and compliance management errors can easily be overlooked within a large volume of documents. Data handled manually is often stored in disparate systems, meaning crucial information is dispersed. Task management becomes a burden when different employees and departments are in charge of various tasks at different times – making the process overly complicated, slow and with a high risk of error. All these compliance issues can have very detrimental consequences for a company’s post-approval process, such as:
- violations of a contract’s terms
- late fees and bottlenecks
- litigation hang-ups
- damage to budget and reputation.
Simplify and streamline compliance management
A secure, centralised contract repository allows compliance personnel to keep track of documents pertaining to obligations, terms, regulations, committals and key dates – in one location. Quick search toolsensure contract terms readily available to compliance professionals. Reports help compliance managers stay ahead of obligations and deadlines, allowing them to assign tasks accordingly. Task management is simplified with task and key date alerts, intelligent workflow, and task-escalation tools.
Excel whatever your role with contract management software
To meet your contract-related goals, Four Business Solutions recommend Contract Insight®, a leading contract management solution, perfect for managing your entire contract lifecycle. Its capabilities mean that businesses just like yours can manage contracts more efficiently by:
- mitigating risk
- overseeing compliance
- drafting documents quickly
- tracking and reducing costs
- receiving alerts
- signing documents with E-signatures
- transforming outdated contract administration procedures.
Contract Insight’s contract lifecycle management software is relied upon by thousands of contract, legal, procurement, risk, compliance and sales professionals worldwide.
Contract Insight from Four Business Solutions
Contract Insight’s contract management software is a robust, user-friendly solution that benefits thousands of users in large and small organisations throughout the public and private sector. It’s flexible and configurable and can meet your specific needs. If you’d like a demo of Contract Insight or simply to find out more about what we do, please call John O’Brien at Four Business Solutions on 0800 6250 025.
Four helps small and multi-national organisations enrich the way they work. From supply chain to procurement and contract management, we have decades of experience helping companies forge ahead in the global market.
John O’Brien is the CEO at Four Business Solutions, global business consultants and software integrators providing business processes improvements in Finance, Supply Chain and Operations, across a broad range of industries.