How to Make Your Contract Lifecycle Digital? 9 Key Steps to Transformation
The adequate management of contracts is essential for the smooth running of a business. Contracts are too important to be processed and stored manually. This is why lots of companies are now going digital. In recent years, contract lifecycle management software has transformed how businesses manage their contracts.
Factors Leading to the Digital Transformation of Contract Management
Several factors may lead you to transform your contract management system digitally. Some of them are:
Increased Speed and Accuracy
The use of CLM software will make your contract management processes much more efficient. When you store all necessary information in a central digital repository, contract signing will be much faster.
With CLM, there’s precision in timing for each stage of the contract. The time saved can be allocated to more productive tasks and activities.
Your valuable documents will be more secure when you use an online contract management software. Your documents will be encrypted in cloud-based storage.
CLM solutions will give you a well-detailed overview of all contracts. The proper organization of all information will make it easier to complete tasks and meet deadlines.
Contract lifecycle management services will help you keep track of your employee’s performance and locate improvement areas. Your company will be much more productive.
Also, with digital contract management, your negotiation time is significantly reduced. Rather than several rounds of changes and explanations necessary in a negotiation before you reach an agreement, each party can see where changes are made. You can also edit or improve the changes. This makes negotiation easier and faster, leading to improved overall performance.
How to improve contract management performance using digital tools
If you want to boost the performance of contracts with digital management software, it’s critical to know how to implement and operate the platform correctly. Once your new tool is successfully integrated, you will begin to benefit from the contract lifecycle software.
Start with standardization and organization
Before you begin streamlining your management process using digital technology, it’s imperative to set yourself up for success. Having a pre-specified management process that governs each contracting phase will help make drafting and negotiating using the software much more straightforward.
Train your team and give them time to adapt
A huge part of ensuring that your management software boosts your performance is taking the time to train employees and giving them time to adapt. Companies often overlook this step, but without it, your employees won’t know how to use the platform to its full potential.
Identify agreements that can be used as templates
When creating templates, you will want to start with low-risk contracts that are most used in your company, such as those that can’t be adjusted or negotiated. This will help ensure that your team has a solid foundation to build upon while adjusting to the new management method.
Revise management policies and procedures as needed
Finally, you will want to adjust your previous management processes to account for the new digital platform. For instance, if you utilized a shared calendar for deadlines and milestones, you should migrate it to the new software. Ensuring that your policies and procedures are integrated allows you to get the most out of the solution.
A More Professional Approach
The use of state-of-the-art contract management tools will make your business appear more professional and modern. Paper and pen contracting will be a thing of the past. The younger generation will find your business more attractive when you utilize contract management software.
9 Steps to Digitize Your Contract Management System
Below, we have explained nine simple steps by which you may transfer your contract management system into a digital one.
Cloud-based Central Repository
The importance of setting up a cloud-based central repository is to store, access safely, and manage your contracts. It allows you to transfer all your contracts to a central location.
Your employees will be able to access and upload important information seamlessly. Records of contracts will also be much easier to keep. Finally, moving your contracts to cloud storage will give you more security as only authorized personnel will be able to access them.
Automated Alerts or Reminders
Another essential step in digitizing your contract management system is by setting up an automated alert system. This will enable your employees to keep up with deadlines better. Your employees will get reminded of upcoming events beforehand and hence, make the necessary preparations.
Template Libraries for Contract Compliance
Creating template libraries for your contracts will make it easier for your company to establish compliance via contract compliance tools. The management of agreement clauses will be more straightforward. With contract management tools, only approved and updated languages will be included in your contracts.
Version Control to Avoid Duplicated Information
When you digitize your contract management system, you get the advantage of avoiding the duplication of information. In manual systems, duplicate information is always created during communication, analysis, and decision-making. The duplication of information reduces efficiency and confidentiality.
This makes it challenging to identify the original or updated version of a document. With Version control, every duplicate information you create will have a time stamp.
Clearly Defined Contract Lifecycle
The advent of contract management technology has made wholesale changes to the management of contract lifecycle processes. Without proper management of your contract lifecycle, your company is bound to record due to events like early terminations and missed renewals. When you digitize your management system, you get to maximize your business’ performance through all the phases of your contract’s lifecycle.
Embrace Electronic Signature
The process of contract signing is much faster in a digital contract management system. With electronic signatures, your employees will no longer have to carry documents from one place to another to get them signed.
The concerned parties will be able to sign contracts from remote locations as long as they have access to the internet.
Visual Dashboards and Real-Time Reports
Dashboards are visual tools that are designed to make life much easier for your employees. With dashboards, your employees will be able to view relevant company’s information at a glance. It summarizes the vital pieces of information an employee needs at a particular point in time.
Role-Based or Feature-Based Permissions
There are lots of benefits attached to having all of your company’s contracts safely stored in a central repository. But for the system to be genuinely efficient and secured, you will need to control the accessibility of your stored information. Each employee should only be granted access to information relevant to his or her role.
Full and Detailed Audit
For you to keep a full and detailed audit, you will need to generate an audit trail. This will be difficult for you if you run a decentralized contract management system. A centralized contract repository, on the other hand, will make the process smooth and straightforward.
The importance of taking the proper steps to digitalize your contract lifecycle process
By automating each management stage, you can ensure that you’re reaping the full benefits of your new technology-driven solution and getting the most out of your investment.
Here are some of the advantages of properly transitioning to a digital management system:
Decrease contract cycle length
Since digital contracting tools allow you to speed up each stage through features such as collaboration tools, smart templates, automated reminders, and an organized repository- your agreement lifecycle length will significantly decrease when you implement them.
Improve terms and conditions
Automation platforms streamline the negotiation process, allowing you and the other parties to focus on creating the best possible terms. Rather than worrying about technicalities or wasting time waiting for the other party’s schedule to open up, you can seamlessly collaborate on the platform and complete redlining, revising and editing virtually.
Increase profit margin
Since your contracts will be more beneficial, your company will begin to lower expenses and boost profits from entering agreements. All aspects of digitalized contract management play a role in this, considering that wasted time is wasted money, and faulty deals are lost opportunities.
Lower contractual risk level
Without advanced insights and analytics, companies often take on more risk than they can handle. Using a digital platform lets you view your portfolio’s overall risk level and adapt accordingly to avoid taking on too many risky agreements.
Is There Any Tool That Can Help With All of These?
Yes, a Parley Pro software will give you the means to accomplish all the steps stated above.