Contract Management Software: Expectations vs. Reality

Contract Management Software: Expectations vs. Reality

For businesses that manage multiple relationships with their clients, the chances are that they will have to manage a number of different contracts. As part of this, everything needs to be adequately tracked. Yet, as the number of clients the customer has to deal with begins to grow, managing this process can become difficult.

At this point, it would be beneficial for the organization in question to consider contract management software if they’re continuing to manage their contracts manually. There are many benefits to using such a solution. Risk is much better managed, productivity for other members of the team increases, and compliance can improve.

Aside from such a system, the organization may have considered an alternative, such as document management. While this does provide an ideal repository for documents, it lacks most other features of a contract management system. Such as the ability to communicate with other parties, set alerts, or begin workflows.

 

Reasons why Contract Management Software is the Best Choice
  1. Combines document repositories with a search function manually managing contracts often results in duplication, mixed versioning, and even lost contracts. Contract management software incorporates a central document repository, keeping everything in one place, and increasing the likelihood of everything staying up to date. Contract management software also supports the use of metadata. Information can be tagged within contracts which makes it more searchable. This makes it much quicker than searching for contracts manually.
  2. Key Provisions, Obligations, and Alerts can be SetIn contract management, it is essential to know when provisions, obligations, and renewals are expected to occur. Contract management software contains all of this functionality built-in. It informs staff when a renewal is about to take place, and whether non-compliance is a current problem, or if any outstanding obligations need fulfilling.
  3. Advanced Search Features Enable Easier Searching Through TextBusinesses that still manage their contracts manually will not benefit from the advanced search feature that is a central part of contract management software. Searching for contracts manually can be difficult and time-consuming. In contrast, contract management software with search functionality makes the process quicker. Different parameters can also be used for the search, making such a system very versatile.
  4. Incorporates Electronic SigningManual contract management requires paper copies of contracts to be passed from stakeholder to stakeholder in order to obtain a wet signature in each instance. This is a time consuming and austere way to collect signatures and only delays the contract kick-off even further. Contract management software usually enables e-signature, which is a much quicker way to obtain signatures from all parties involved. Additionally, because e-signature is digital, it eliminates the need for contracts to move from one location to the other physically, which reduces the risk of the agreement falling into the wrong hands. E-Signature also makes the process of auditing much easier.
  5. Allows Easier Creation and Amendment of ContractsOnce a contract has been drafted, it can take a while for it actually to begin. It may take a couple of weeks to a couple of months. So as you can see, it can take time for a contract to commence. Contract management software helps to quicken up the process as it has features such as templates and clause libraries that save time in compiling the contract. Contract management software also makes amendments easier to deal with, as amendment wizards and document upload capability are built-in.
  6. Enables Better Report Creation and ReviewContract management software usually incorporates the ability to create performance reports which provide useful insight for staff and contract managers. Such functionality can identify bottlenecks, which can then be eliminated, so it helps to make the contracting process more efficient. Similarly, contract management software also helps with better contract renewal as well as the meeting of obligations.
  7. Allows the Enforcement of Governance Standards and StandardisationManual contract management requires a brand new contract to be written from scratch every time it is needed, including appropriate policies and guidelines. By using contract management software, this can be automated and made quicker, thanks to inbuilt features like metadata rules and different contract types. Contracts can be customized in more detail, and governance becomes easier to enforce.
  8. Makes it Quicker to Build Contracts Using Clause Libraries and Automatic TemplatesContract management software helps to save time as it contains many automated features. One of the most important is a standardized clause library which can be used with all the contracts being managed. Standardized clause libraries can be used in combination with word processing software, allowing clauses to be inserted in one single click, which definitely saves time.
  9. Encourages Easier Workflow and Approval ManagementManually dealing with contracts can result in issues like poor transparency and versioning, which is common when contracts are sent over email. These kinds of problems are eliminated when contract management software is utilized because participants and routing order can be selected, and overall approval becomes easier. Notifications mean that users are instantly updated, whilst auditing becomes easier thanks to the workflow history feature.

 

Why You Need to Replace Manual Contract Management with Automated Software

If you are a business with a growing client base, you probably have to deal with more and more contracts as a result. If this happens to you, you may find that dealing with an increasing number of contracts manually can be challenging.

Perhaps you have considered something like document management. While this is an excellent way to store documents centrally, it lacks the functionality to manage contracts well. This is where contract management could be considered.

It is the best solution for managing a high volume of contracts. Enabling parties to communicate better, workflows to start more quickly, and allow the setting of alerts, so nothing important is ever missed again.