Negotiating Contracts in a Digital Age. Precisely Contract Management
Contracts and bills of sale have evolved considerably since the days when terms between two parties were laboriously etched in ancient stone and pressed into clay tablets, or written by dedicated scribes on brittle papyrus scrolls. Nevertheless, the medium and method of contract negotiation has remained uncomfortably static for decades.
Go ahead with modern contract management solutions for digital negotiations.
The advent of office applications such as WordPerfect and Microsoft Word brought the legal industry into the digital age, but the usual contract negotiation digital process in 2021 can hardly be described as intuitive or dynamic. Indeed, parties are still hashing out complex terms via extended email threads, deciphering multiple “track changes” versions with confusing colors, and scratching their heads over which version of a contract document is the most up-to-date.
The current contract negotiation paradigm involves an enormous amount of time-consuming, manual clerical work and is therefore overly susceptible to human error. This contributes to an overall lack of efficiency, the risk of non-compliance, frequent misunderstandings between parties, extended negotiation cycles, canceled deals, and lost revenue.
Here are some of the ways that an online negotiation platform can speed up the negotiation process:
View changes in real-time
With negotiation software, both parties can instantly see changes made to the contract. You won’t have to wait to meet with the other party in person to discuss changes or wait for the other party to email you. Every edit is available when you or the other party open up the document. That way, you can discuss the elements of a valid contract with ease.
When many changes are made during a negotiation session, the document can become cluttered and difficult to read or to tell what sections are being edited. With digital redlining, all proposed changes are neatly laid out on the document. What’s more, both parties can redline simultaneously, unlike with paper contracts.
Your entire negotiation process can get thrown off if you begin to change a previous version of your agreement. It can become even more confusing if you and the other party begin to edit different versions of the same contract. All of this leads to wasted time and can easily be avoided when you implement digital negotiations.
Cloud-based storage allows each stakeholder to access the contract from any location at any time. This is essential for individuals who work from home and is even helpful when a partner travels. Since the document is remotely accessible, parties can view and make adjustments to it at their discretion, eliminating waiting periods.
The Importance of Privacy in the Digital Age
The digital information age has paved the way for more private and secure legal documents. Before, companies who relied on manual management had their sensitive documents scattered around the office, shoved into filing cabinets, and left in unsecured email inboxes. However, many have realized the detrimental consequences of security breaches and thus have turned to using a contract negotiation platform.
Here are a few of contract management software’s most beneficial security features:
Cloud-based repository storage
Cloud-based storage allows you to access documents remotely during digital negotiations while safeguarding your information. Many offices store their sensitive documents in shared folders on various hard drives. However, this leaves them vulnerable to data breaches. Keeping agreements on a centralized repository that’s password protected and cloud-based is one of the best ways to stop hackers and malicious individuals from gaining access to your confidential data.
Cloud-based storage also prevents your essential documents from getting lost or destroyed. One minor incident could mean disaster when documents are stored on a hard drive or filing cabinet. Although a hard drive is more secure than physical paper documents, you still risk losing the file if something happens to the computer it’s stored on.
Sometimes you don’t want everyone who has access to your online negotiation platform to have access to all of your contractual documents. However, when contracts are unorganized and stored across multiple locations, it’s nearly impossible to determine who can and cannot access sensitive documents. Once you hold your contracts on a centralized management platform, you can set role-based permissions to enhance your data security even more. This lets individuals access and edit certain agreements but keeps them from accessing others outside of their jurisdiction.
With role-based permissions, you can ensure that everyone is only editing and viewing the documents they were assigned to work on, preventing unapproved edits and potential information leaks. These permissions give you peace of mind while keeping your team on track.
One of the most effective ways to protect your data in the digital information age is by using encryption at all levels. Encrypted data is one of the best ways to increase your privacy in the digital age. It deters hackers and other malicious individuals from intercepting data sent to another party and manipulating it for their gain. With encryption features, the recipient can check to see if unauthorized users are attempting to access the data and deny them from viewing or editing it. To maximize your security you will want to ensure that your information is encrypted at rest and in transit. This means that documents should be encrypted when stored within your contract management platform and while they’re sent to different users.
Secure intake forms
Many companies don’t realize the risk of using email to request agreements and collect the necessary data to draft them. Email is the most common way for hackers to infiltrate business networks with harmful software and viruses. You can prevent this by using a contract negotiation platform that offers pre-defined and encrypted intake forms. That way, you can ensure the privacy of your clients’ data.
Every company should prioritize the security of their clients’ sensitive information. Not only do intake forms make it easier to onboard new clients and business partners, but they allow you to protect your clients’ information, allowing you to build trust. Additionally, online intake forms are widely used in the medical field since they are HIPAA compliant, which means their security level is top of the line.
Understanding the contract negotiation stage
In addition, parties involved in complex digital negotiations typically have little insight into how close a contract is to being finalized, making accurate revenue projections difficult if not impossible for accountants and businesses. This is precisely why there is a salient need for a cloud-based contract negotiation platform that optimizes efficiency, visibility, and process control for all parties involved.
To be sure, a platform specifically designed for legal contract negotiations with a single integrated, intuitive interface, effectively eliminates the chaos caused by the use of disparate tools such as Word and email. Simply put, it helps parties successfully clinch an agreement on the very same platform, document, and iteration in real-time.
Coherent manner in the contract negotiation process
Contract negotiation process points, comments, concerns, and proposed changes are neutrally formulated in a coherent manner – with follow-up actions facilitated by interactive discussion – rather than the usual indecipherable text, oblique notes or easily misconstrued red lines.
What must a contract negotiation process platform have for successful digital negotiations?
Assigning user roles
User roles allow administrators to delegate tasks to their colleagues with ease. This enables your team to collaborate on deals efficiently. With delegated roles, your company will close agreements quicker by splitting up the various duties in the lifecycle.
Tracking critical milestones
Many companies who don’t properly track their contracts’ critical milestones end up missing them, resulting in unnecessary fees and lost clientele. With a contract negotiation platform, you will easily manage any milestones, including renewals, ensuring that you don’t waste time and acquire unnecessary expenses.
Contract status insight
It’s critical to keep track of the status of your agreements to ensure that there aren’t any bottlenecks in the process. Without a solid digital platform, many corporations end up with delayed contract cycles, which results in low productivity levels and missed opportunities.
Another way to ensure successful negotiations is by gaining insight into your repository’s key performance indicators. It’s essential to analyze your KPIs to see which areas in the contract cycle are performing well and which ones need improvement.
Manual signatures are the culprit of a lot of wasted time in contract lifecycles. One way to reduce this delay in the process is by using your software’s eSignature feature. Utilizing eSignatures allows you to instantly approve agreements without having to meet with the other party in person.
These features are critical for strong management software since they allow companies to streamline their agreement lifecycles. Streamlined and standardized processes enable modern businesses to meet clients’ demands in the digital information age, where they expect their partners to deliver deals as efficiently as possible.
In addition, open discussions can be prioritized across the entire contract, allowing parties to focus their attention on key issues. Meanwhile, interactive dashboards play a vital role in helping all participants optimally manage both workflow and negotiations by assigning specific user roles, tracking critical milestones (including renewals), displaying the current status of a contract, and highlighting key performance indicators. Once consensus is reached, a cloud-based contract negotiation platform can also automatically move a unified document into eSignature, allowing parties to conveniently complete the agreement.
Want to learn more about how we are helping the industry more efficiently negotiate contracts? You can request a demo from Parley Pro here.