Steps to Improve Your Contract Management Process
You can make your contract management process flawless by following some key points when entering agreements. An efficient end-to-end management process should implement automation and follow a flow from creation to closure.
If you take the time to perfect your process, you can benefit by minimizing mistakes, shorting life cycles, boosting profits, and strengthening relationships.
What difficulties do people face when using a manual contract management process?
People run into trouble when they attempt to manually manage their agreements, leading to mistakes and poorly crafted agreements. Difficulties such as creating ambiguous terms, losing track of different versions, missed deadlines, and more can make agreements unsuccessful.
Manual management processes produce costs that smart contract management or automation tools can mitigate because they limit the stages prone to human error.
Many companies are automating their contract management process cycle in 2021 due to its proven effectiveness. Manually managing your agreements is becoming an obsolete practice because businesses have the technology to automate the processes leading to convenient and faster deal closing.
If your company wishes to keep up with its competitors, utilizing an intelligent end-to-end contract management process is necessary.
What contract management process steps should you follow?
All business negotiations are finalized with a written contract. Therefore, they should manage them strategically to minimize risks and create beneficial relationships. As businesses grow, the number of deals they handle daily makes it imperative for the management process to save time instead of wasting it.
Follow these steps to ensure that your agreement process is flawlessly executed:
- Prepare the deal document by identifying your needs, goals, expectations, and risks.
- Begin drafting the agreement with the help of a template.
- Before finalizing the document, use contract review tools to check for mistakes.
- Use a management platform to negotiate the terms of the deal.
- Virtually sign the agreement using e-signature software.
- Keep track of edits and amendments to the document using a CLM software.
- Perform regular audits to ensure that obligations are met, and no opportunities are lost.
How does a modern contract management platform help a business grow?
Is your business growing too fast for manual contract management to keep up. If you find that your current management process is becoming obsolete, then it’s time to consider implementing an automated contract lifecycle management platform. With CLM tools you can experience the positive impact of technology on business firsthand and discover the key to helping your company grow to rise above its competitors.
Hesitant to switch? Here are some benefits you can expect when you switch to a technology-based contract management system:
Wasting time on repetitive administrative tasks is a huge frustration for legal departments. They could spend this time much better on tasks that actually contribute to your company’s success. When your team automates its contract management process, you can free up time to focus on your company rather than scanning, signing, and sorting through papers.
Contract risks are hard to spot with the naked eye. They’re typically hidden within the document, including unapproved terms and overlooked obligations. CMS reduces these risks by providing you with helpful resources such as pre-approved clauses, simplified audits, an organized portfolio, and automated alerts.
Contract management platforms are designed to scale with your business as it grows. The software can handle as many contracts as you throw at it without reducing its efficiency. Since it also reduces costs and boosts productivity, you can invest more money back into your business and free up time to find ways of improving your other operations.
How can you make a contract management process cycle flawless?
Availability of pre-approved templates with clauses
Templates ensure that all information is updated and will autofill required clauses. A platform that includes pre-approved templates will speed up your agreement lifecycle and limit the number of costly errors made when drafting a deal.
Dynamic metadata for searchable organization and storage
An automated organization system ensures that you don’t send out the wrong version of a document and don’t lose any agreements you need. Software that includes a single repository with searchability will ensure that you never lose track of which version is up to date.
Enhanced analytics to measure and scale performance
Insight into the process allows you to figure out which stages need the most improvement and which workflows are the most efficient. An automation system will collect data on your agreements that you can use to scale performance and boost efficiency.
Flexibility of renewing and changing processes
Contracts are rarely stagnant throughout their lifecycle. This means it’s necessary to be able to make changes and renew them conveniently as needed.
However, when manually managing processes, changes are difficult to make since there are no real-time updates. A management solution will automatically update documents accordingly and notify parties of those changes.
Safe and secure delivery
When paper agreements are sent in the mail, they are vulnerable to getting lost or even stolen. Even computer documents are sometimes insecure if not created on a platform that takes the proper security measures to protect your confidential information.
A platform offers a safe way to send documents back and forth, minimizing the chance of leaked information.
Contract management platforms improve visibility in a couple of different ways:
A centralized cloud-based repository makes contractual work more accessible to everyone. Internal and external stakeholders can retrieve documents from any location, allowing everyone to be involved during every stage of the contract lifecycle.
Without version control, you risk people editing the wrong document and lack of visibility regarding changes made to the agreement. A CMS helps you prevent confusion by managing contract versions and showing the changes in each one.
Let’s look at a couple of CMS features that can improve your team’s efficiency:
Templates help you create contracts with ease. Instead of starting from scratch each time you can browse the library of pre-approved templates and choose the one that matches your agreement type. Then, you can simply customize the information to fit your unique needs and send it to the counterparty for negotiation.
Workflows ensure that everyone knows what they’re working on and that tasks are split up efficiently. When each member on your team knows exactly what they’re assigned to do, they won’t have to spend time worrying about tasks outside of their domain. Once the document is finished at one stage, it’s sent to the next.
Contract management platforms improve the visibility and efficiencies of your management process in various ways.
The software streamlines each of the following processes:
- Document creation
- Negotiation and collaboration
- Signing and finalization
- Tracking and management
A flawless contract management process will boost your business’s performance levels, leading to increased revenue, better partner relationships, and more successful deal closures.
If you have experience in contract management, automating your processes will be an easy process that will pay off in the long run.
Someone with contract management experience can look at the established management process and perfect it by implementing automation in places that need improvement. Your company will have a flawless process by following the contract management process steps and implementing an automation system.