There are many benefits of contract management software, especially in today’s world. Also, contract management software provides the legal, procurement, financial, sales, and contract administration teams with a useful set of tools to effectively and efficiently manage the entire contract management process. It benefits the organization by speeding up and automating the contract creation, negotiation, and approval process.
It also acts like a repository where all necessary contract-related data is kept securely and safely for easy access in the future. The ultimate goal of contract management software is to reduce and minimize any risks. At the same time, it must ensure efficiency in a very secure and compliant way. It will help you realize the benefits of contract management software, if you use it in a proper manner.
Learn More: Contract Lifecycle Management Software;
Best practices for an effective Contract Management process:
- A standard set of terms and conditions, including a legal language, should be created that applies to a large subset of contracts
- It is essential to track the contract approval time to garner the advantage of receiving contracted goods and services much sooner, ensuring a much swifter move towards a more positive relationship.
- The risk of missing out on essential addresses in group emails can be eliminated by setting automated reminders to alert important stakeholders to review the document.
- There should be complete transparency in an organization’s goal and an achievable and realistic set of KPI’s.
- Vital parameters like financial metrics should be made a compulsory component of the business’ contract management reviews.
- It is mandatory to conduct regular compliance reviews, which might fail to protect the organization against any legal or industrial risk if not performed regularly.
Individuals who are used to this process are well aware that contracts are a part of a business’s administrative aspect and a strategic one. Therefore, if managed effectively and efficiently, contracts are critical for an organization to minimize any legal, financial, or brand risk.
But on the other hand, if it is managed poorly, there is a high chance that one might miss out on renewal dates and expiry dates, lack of efficient governance and compliance, unfulfilled obligations and promises, illegal and unauthorized access of data, and also unhappy stakeholders like customers, suppliers, resulting in lost revenue.
International Association for Contract & Commercial Management (IACCM) has estimated the cost of inefficient contract management to be more than 9% of the total revenue.
It is beneficial to provide timely alerts to key stakeholders as to when the expiration dates are nearing. This helps businesses decide whether to re-negotiate their agreement or instead end their agreement.
Hence, it can help them avoid getting locked into contracts automatically.
- Helps digitize and store contracts:
It helps digitize and safely store all the agreements into one repository. Hence, the legal teams can access them for contract reviews conveniently. This, in turn, eliminates the need to locate and filter through stacks of paper manually.
- Tracking current spends against a supplier:
With the help of integration with other financial and procurement software systems, it becomes very convenient to track the current spend against a supplier or a stakeholder.
- Shareable and Searchable:
Stakeholders can access contracts in milliseconds and share them with others very quickly with a simple link. This helps save a tremendous amount of time as compared to manual processes.
A completely automated contract process can help fasten up the review process and help improve efficiency. The creation of a to-do list helps to scan all contracts. Therefore, contract managers can have a better sense of an organization’s current situation.
This, in turn, helps remind other parties of their roles and responsibilities and helps define escalation procedures.
A company may retain thousands of contracts, which are scheduled to increase in the near future. Therefore, this type of cloud storage makes it easier to unearth the required arrangements.
- Maintains operational efficiencies:
Prevents any friction between teams and maintains the velocity, which is essential to enhance a company’s ability to close deals. A well-managed system can prevent expensive renewal costs.
These are some of the main benefits of contract management software
Contact product.marketing.com to learn more about how Zycus’ Contract Management Software can help your organization achieve accelerated contracting processes and enhanced compliance across multiple legal and government regulatory systems.
