Contract management is a process that has been embraced by contract professionals of numerous industries worldwide. But why do organizations need contract management? Read on to discover six reasons why contract management is necessary - and how you can positively transform contract management with user-friendly contract management software.
Why Contract Management Is Necessary
Contract management is necessary for organizations to maintain contract visibility, contract lifecycle management efficiency, and insights into the contract process - to name a few. A robust contract management strategy helps organizations centralize contract lifecycle management - from contract requests through contract renewals. Contract management software is essential for addressing contract management for the six reasons below.
#1 - Contract Storage
Contract storage is where and how you store your contracts, contract documents, and contract data for proper security, access, and organization. It is a necessary aspect of contract management. Without proper contract storage, your organization can suffer from:
- lost or misplaced contracts, contract documents, or contract data.
- a lack of contract visibility.
- misplaced or unclear contract document versions.
- overlooked contract lifecycle tasks.
- missed contract key dates and obligations.
- contract compliance violations.
- a lack of contract security - with contracts, documents, and data potentially falling into the wrong hands.
- wasted time.
- squandered revenue.
It is necessary and beneficial for your organization to be equipped with a secure contract repository. With a secure contract repository within contract management software, your team can enjoy one centralized location for contracts, corresponding contract data, and corresponding files and attachments. User permissions can make it so only those qualified and necessary team members have access to mission-critical data.
For even more excellent contract repository oversight, you can eventually find it necessary and helpful to leverage a contract management software platform powered by robust contract artificial intelligence. Your team can utilize a proven contract repository system within leading contract lifecycle management software for contract analysis and transforming static contract documents into dynamic CLM building blocks for proactive contract oversight, opportunity identification, and risk mitigation. Contract AI and machine learning can help your organization attain significant ROI from its contract repository. Critical data from introduced contract documents can be intelligently mapped into your contract repository's out-of-the-box or user-defined fields.
A Contract repository is also necessary for enhanced data protection. This data protection is valuable no matter which industry your organization is in - but is perhaps most critical for highly regulated industries such as healthcare, government, and pharmaceuticals. Your organization can identify vital data such as key dates, milestones, contract clauses, contract counterparty information, locations, phone numbers, email addresses, financials, and more - thus reducing the need for tedious, time-wasting, and error-prone manual data entry. Your contract repository data can be extra safe with a contract management software provider that is SOC 1, SOC 2, and Privacy Shield compliant – such as CobbleStone Software.
A contract repository also simplifies contract searching. Speaking of contract searching...
#2 - Contract Search
Contract search is a necessary aspect of contract management. Without the capability to easily search for contracts, documents, and data, your organization can face contract lifecycle bottlenecks, neglected or misplaced contract assets, and overlooked opportunities and insights. Thankfully, leading-edge contract management software can deliver state-of-the-art contract search for optimal contract visibility.
Quick search functionality within leading CLM software makes it straightforward to search for contracts, documents, clauses, and associated data. Your contract management software users can quickly enter a string of letters, words, or numbers for a contract search. For instance, your users may "quick search" the term "XYZ Agreement," and the CLM system can search data fields for "XYZ Agreement." Quick search functionality can deliver filterable, sortable results - which can be easily exported to a spreadsheet format. Contract management software areas that populate the results page can be accessed via a clickable link. As such, your team can quickly uncover contracts, clauses, documents, and fields - significantly decreasing contract lifecycle bottlenecks and improving contract visibility.
Powerful contract management software also offers field-level searching. Rather than searching all record metadata in your repository for a word or phrase, field-level searching permits you to narrow searches to one of your configured or system data fields. Again, let's examine our "XYZ Agreement" example. Perhaps this time, your team only wants to search for "XYZ Agreement" within a field for "Contract Title." You can efficiently filter so that this "Contract Title" field is scoured for your term "XYZ Agreement." The filtering, sorting, and exporting choices mentioned above apply for optimal convenience and visibility.
#3 - Contract Document Version Control & Audit Trails
As has been detailed, a contract repository can help with visibility. However - without a clear track record of which contract document versions are the most up-to-date and which are previous, unfinished versions - you can experience a disorganized and confusing process that can cause the finalization of outdated contracts, decreased revenue, and wasted time. Luckily, contract management software can help optimize necessary contract document version control and audit trails.
In-system version tracking within contract lifecycle management software can be a game-changer. Advanced contract software offers a native document editing interface. Whether initiating or editing a document within your system or importing document versions from familiar word processing programs - your CLM solution can be configured to automate version tracking timestamped and numbered versions for detailed contract process visibility. Version tracking can also be relished with centralized and powerful contract management software connectors for user-friendliness and a familiarized word processing experience - such as with connectors for MS Word, MS Outlook, Google Workspace, and MS Office 365.
Robust contract management software can also supply enhanced audit trails to the data field and contract document levels. Your team can confidently track original values, times, dates, and employees that modify contract data fields and documents. Log-in attempts, viewed contracts, and fields on records that have been added, changed, or deleted can be incorporated into audit trails with time, date, and user stamps. Audit logs are readily reportable. Automated version tracking of files and attachments is readily obtainable as well.
#4 - Contract Management Tasks
Contract management tasks are vital to the life of a contract. Without comprehensive task and workflow management, contracts are sure to be delayed - potentially resulting in wasted time and resources, squandered revenue, compliance issues, missed obligations, and missed opportunities. Luckily, contract management software supports intelligent workflow automation.
With powerful and user-friendly CLM software, your team can configure contract workflows for contract lifecycle tasks from contract requests to contract renewals. You can configure assigned users to see task alerts and notifications within the system and via automated emails. Scheduled reminders make it so that your team can automate contract oversight and keep your team vigilant of when task due dates are looming, when they have arrived, and when they have passed. Need extra confidence that tasks will be finished? No problem - you can employ task escalation functionality. If a resource is not completing tasks in a manner you see as punctual, you can trigger an automated escalation of incomplete tasks to a new team member - encouraging efficiency, promptness, and accountability for necessary workflow tasks.
#5 - Contract Signatures
Collecting required signatures for a contract can prove formidable, especially when signatories are in separate locations. This highly anticipated and critical CLM phase that finalizes contracts and drives their execution can be slowed with manual wet signatures. Fortunately, electronic signatures can make signing agreements a cinch with contract management software that empowers signatories to sign in the office or remotely – especially with the aid of a CLM software mobile app. Further, you can leverage digital signatures that practically ensure a signature's date of signing and that it was untampered with after that - decreasing the need for a licensed notary.
#6 - Contract Management Reporting & Contract Analytics
Contract management reporting and contract analytics are necessary to ensure the most significant possible ROI from contracts. Contract management reports and analytics can provide your team with mission-critical insights into the contract lifecycle management process and how it can be improved. Without the proper contract management reporting tools, your organization can miss out on insights for future growth opportunities. Fortunately, contract management reports within contract management software can help.
Cutting-edge CLM solutions offer an ad hoc report wizard to simplify your CLM process. Your team can preview and edit configurable contract management reports for essential contract data at a glance. Ad hoc reports within contract management software can be easily configured, named, saved, and sorted for future execution, charting, and easy exportation to MS Excel. User permissions conditions can give you control over who can view and edit ad hoc reports. For increased governance, you can configure automated emails of ad hoc reports on a daily, weekly, monthly, quarterly, or yearly basis. Furthermore, ad hoc reports can be configured to show on your users' dashboards for powerful contract management reporting at a glance upon logging into the system.
An online contract management software report designer can proffer your users even more contract visibility with configuration options for the appearance, structure, and information displayed on contract management reports. Leading contract software solutions even provide drag and drop report designer tools similar to that of other leading third-party reporting tools. The reporting functionality can allow your team to configure comprehensive reports that include text, images, graphics, variables, conditions, cross-tables, multiple data summary options, and much more. Again, leading contract management software allows you to export reports in various file formats.
Eye-grabbing executive graphical dashboards allow your team to see critical contract data at a glance for enriched contract analytics. These dashboards can contain crucial analytics including (but not limited to):
- Contract KPIs (shown below)
- Contracts Overview
- Contracts by Department
- Vendor Management
- Year Analysis
- Bids Overview
To learn more about visually attractive report options like the one shown above, click here.
Need more time to decide on your contract management software investment? No problem! Download our free contract management tracker below in the meantime!
Tackle the Necessities of Contract Management Today
Now that you know why contract management is necessary, you should consider implementing an award-winning contract management software platform that delivers the comprehensive contract management tools mentioned throughout this blog. That solution is CobbleStone Contract Insight. CobbleStone's scalable, low-friction contract management software platform has been trusted by contract professionals in various industries for over 20 years and counting. CobbleStone has been praised and awarded for offering contract lifecycle management tools to conquer contract processes with optimal contract visibility.
Just look at how CobbleStone transformed legal operations in 2021 alone! It's no wonder why Forrester names CobbleStone a Leader in CLM software!
If you want to positively transform contract tracking and contract lifecycle management, book your free demo to see CobbleStone Contract Insight in action!