Procurement departments can encounter procurement workflow inefficiencies without the proper procure-to-pay tools – especially when implementing inefficient and disjointed contract management processes. You can avoid risk, unreasonable vendor pricing, and vendor non-compliance by leveraging contract management processes in procurement that centralize processes, technology, and people. Read on to discover how you can implement effective contract management software in procurement.
What Is Contract Management in Procurement?
Procurement processes siloed of contract management processes can cause procure to pay workflow inefficiencies and reduce your overall bottom line. Fortunately, integrating contract management within procurement can be accomplished with a source-to-contract lifecycle management suite that electronically centralizes vendors, contracts, and payment notifications – enabling procurement professionals to source vendors, attach contract records to sourcing records, and manage contracts.
Contract Management in Procurement
Without integrating contract lifecycle management within procurement, you can create an inefficient and ineffective procure-to-pay process that can reduce your organization’s bottom line. Fortunately, eProcurement software with integrated CLM software can centralize electronic bidding procedures, sourcing records, vendor records, contract records, and contract management processes from requests to renewals along with vendor contract spend tracking against procurement budgets.
Contract Management Procurement Process
Without the proper CLM tools within your eProcurement system, you can incur contract mismanagement bottlenecks that can delay contract management processes. Fortunately, leading CLM software tools – including automated contract assembly, eSignatures, contract budget management, and contract risk assessment mapping - can enable you to expedite the pre-award contact management process and optimize the post-award contract management lifecycle.
To learn more about eSignatures, watch the video below.
Automated Contract Assembly
Contract generation can be challenging, especially with multiple people involved. Creating, reviewing, and revising documents can consume large amounts of time and energy. Manual vendor contract assembly can increase errors when static documents become obsolete, and parties are unaware of the most up-to-date templates and versions. Clauses, approved language practices, and templates that are not current or standardized run the risk of procurement professionals inadvertently creating non-compliant contracts.
Fortunately, automated document assembly can streamline the contract management processes with intelligent contract management software that centralizes and automates the creation of agreements, contracts, and documents. You can leverage document assembly software to create compliant contracts that seamlessly merge their organization’s approved data fields and clauses.
A leading contract management solution allows the merging of various document versions and templates from an organization’s pre-approved clause library, which can be exported to various file formats. You can remain abreast of your contracts' evolution with version tracking tools. You can also better control your contracts’ access by configuring user permissions and rules regarding contract version access through approval routing and audit trail capabilities. Moreover, integrated contract intelligence with machine learning can assess proposed vendor contracts for risky language and offer pre-approved contract language alternatives.
To learn how artificial intelligence can improve contract management processes, watch the video below.
Contract Budget Management
Managing procurement budgets and maintaining budgetary compliance for organization-wide compliance can prove challenging. Budgets require constant oversight. Without a robust system that tracks contract value against allocated budgets, your organization can run the risk of overspending. Fortunately, leading eProcurement software can enable you to input budget line items - containing ancillary documentation, including contracts.
Necessary stakeholders can be labeled appropriately to retain interdepartmental accountability. You can be attribute expenses to the proper department within your organization, and contract monetary amounts can be subtracted from the overall budget. With the help of internal request features, you can submit interdepartmental budget requests to secure funding for varying objectives – streamlining procure-to-pay processes.
Contract Risk Assessment Mapping
Assessing contract management risk within a myriad of vendor contracts can be challenging without prioritization and visualization. Whether dealing with ten or ten billion vendor contracts, identifying and prioritizing risk factors can prove challenging when sifting through words and other data variables within pages of documents. Without a centralized and graphical opportunity assessment tool, identifying risk can prove to be an arduous task.
Luckily, leading eProcurement software offers risk assessment and OFAC search mapping tools to graphically visualize risk within your documents for comprehensive risk contract management. Rather than manually sifting through your vendors’ contract records for risk variables, you can leverage a visualized graph that can plot contracts based on their identified risk score – yielding a holistically visualized risk analysis of active contracts that can help you effectively prioritize contract risk factor decision-making. Moreover, you can analyze how a contract would perform with hypothetical risk variables and exposure within a risk assessment matrix - further helping you and your internal stakeholders prepare for future happenings.
You can leverage this visual contract risk assessment matrix and statistical data analysis to identify negative, neutral, or positive facts about contracts within your eProcurement system to help improve your contract strategy. Message alerts can also be enabled to notify you if a contract incurs a value of X% greater than the average contract within your vendor contract database.
You can also leverage the OFAC search graphical risk tool to identify if your vendor contracts comply with the Office of Foreign Asset Control’s national sanctions list.
This graphical risk visualization allows you to identify vendor contracts’ OFAC compliance both in the pre-award and post-award stage – increasing comprehensive risk mitigation. Moreover, you can preconfigure rules to notify you in real-time if a current contract meets or exceeds a specific OFAC Search percentage - allowing for swift risk mitigation before it becomes untenable.
Leverage Integrated Contract Management & Procurement Software Today!
Streamline your procurement and contract lifecycle management processes with a leading eProcurement solution with integrated CLM software. End-to-end contract management in procurement begins and ends with CobbleStone Contract Insight®.
Discover why Forrester names CobbleStone a Leader in CLM Software in the video below.
CobbleStone Contract Insight can equip you with the necessary tools you need to drive procurement and contract management success. CobbleStone’s trusted, award-winning, fully integrated CLM software streamlines contract management and procurement processes with optimal governance, reduced friction, and high flexibility from vendor contract requests to renewals. CobbleStone Software has been a visionary leader in CLM software for over 20 years. CobbleStone’s user-friendly, robust, and scalable solution seamlessly integrates with mission-critical applications for unified and seamless contract management. CobbleStone Software, as a software provider, also remains SOC 1 and SOC 2 compliant to encourage paramount security.
Discover why thousands of contract managers trust CobbleStone Software with their contract management needs. To learn more about CobbleStone’s unparalleled contract management software, book a free demo with a Contract Insight expert today!
Are you interested in future-minded contract lifecycle management software tools? Learn how to leverage industry-leading CLM software tools for streamlined, user-friendly, and low-friction contract lifecycle management success in the video below!