A new year beckons, and along with it comes the impetus to make change; to implement improvements; to work toward optimal operation. It is a natural consequence of society’s emphasis on review activities in December, coupled with the imminent arrival of spring, and it is the perfect opportunity to address hurdles in your journey to Contract Management efficiency within your business.
Your progress toward Contract Management efficiency may already be well under way. Perhaps you have already implemented your Contract Management Software, or perhaps you are still working with spreadsheets and unconnected databases, and are shopping around for a better solution. Whichever situation you currently find yourself in, it’s important to ask, is legacy data the biggest hurdle you face?
What is legacy data?
Legacy data in Contract Management is essentially the detail of the older agreements held by your enterprise. These could have accumulated during your earlier days of operation, and could therefore consist of a mixture of paper and digital files. They could also have been acquired during a merger, or business takeover. Whatever its origin, legacy data can represent a time when the business operated in a very different way, and can be made problematic by its format and scattered, varied storage.
Some legacy data may be referred to only rarely, if at all, but it is a vital asset to your business. Some of the agreements may still be active, but their long-term status may mean that they have been largely left to roll onward, automatically, as personnel changes happen over time. The result of this gradual neglect is a treasure trove of untapped potential sales leads and missed opportunities to renegotiate – both of which have the ability to improve your bottom line over time.
This is why it is vital to include legacy data when considering improvements to your Contract Management System. The very nature of it, as older documents that are perhaps less clear, and possibly have documentation missing, can make legacy data seem like the biggest hurdle to overcome in your Contract Management System. It can be tempting to focus on more recent, more clearly active agreements, and leave the legacy data as something that needs to be sorted out at some indeterminate point in the future. This temptation should be avoided at all costs, though, because legacy data is both financially valuable to your business, and vital in terms of administration. In short, including all legacy data in your Contract Management System ensures that your operation works at optimum efficiency, with productivity boosted, and costs reduced.
How do you handle the hurdle?
So, you need to include the legacy data in your Contract Management System – now how do you do it? How do you gather all agreement documentation from various locations, scattered throughout your business operation, in such a way as to then enter it into a software package in an ordered, useful fashion? Firstly, you break the task down into achievable chunks of activity, and then you acquiesce to the fact that some detective work will be needed to get the job done.
- Track it down – You can’t do anything with the legacy data until you have all the legacy data, so the first achievable chunk of activity is to track it down. The most methodical way to do this is to go department-to-department, collecting and collating copies of all contract documents and supporting paperwork – regardless of age.
- Review and catalogue it – Having retrieved all the legacy data, each individual agreement must be reviewed and catalogued. This means that, for paper documents, the terms must be examined and assessed for activity and usefulness, and the contract metadata should be recorded. This is the best point at which to scan the documents to create a digital version. For documentation that is already digitised, the same review and cataloguing process is necessary.
- Investigate contract revenue flow – Your detective work continues, and should lead you to the Accounts Department at this point, because you need to determine the financial flow associated with each contract, in order to determine its individual efficacy and ongoing relevance. You need to confirm whether or not there is movement of money or capital associated with each legacy contract and, if there is, the quantifiable value that this gives the contract within your business.
- Ask questions of personnel involved – Many examples of legacy data are agreements that have been long-established, and somewhat forgotten, so it is a good idea to discuss the detail of the agreement with the personnel involved in its creation, if they are still employed by the business. This can provide vital insight into the productivity of the contract, and the detail that is needed for its metadata.
In total, this seems like a mammoth task, which is why it is likely to be a hurdle in the optimisation of your Contract Management System. However, breaking it down into these clear steps makes the process much easier to contemplate, and delegate.
The benefits of digitising your legacy data
Contract Management Software is the very best way to manage your Contract Library, and the meticulous digitisation of your legacy data helps ensure that your Contract System is entirely complete. There is little point in populating your Contract Management Software with your most up-to-date agreements, while the historic information that helped to build your operation is essentially missing. All of the savings in personnel time and skills that are made with a digital Contract System are voided as soon as a member of your staff has to leave a task to hunt down a paper document in a filing cabinet, somewhere within your enterprise.
The features of the best Contract Management Software packages, such as Symfact, mean that by digitising it, your legacy data becomes useful, proactive information once again. These features include:
- A centralised Contract Repository – As the name suggests, this is a central location in which all contract data and documentation is stored. The establishment and maintenance of a centralised Contract Repository means that there will never again be a need for detective work within Contract Management tasks. All contracts are visible and available to authorised personnel. In addition, through the metadata of these documents, they can be searched and their content analysed in moments, with automated processes.
- Accurate reporting – A high degree of automation within the Contract Management Software allows for accurate search protocols, delivering actionable data on all levels – from oversight, to granular analysis. With the additional function of alerts, notifications, and automated workflows, this accurate reporting means that contract milestones, deadlines, and opportunities to re-negotiate are never missed. It also allows for the capture of potential sales leads, generated by both current and legacy data.
- Improved risk management – Best practice in risk management dictates that all factors should be considered in evaluating risk, including in contract management processes. If your contract repository is incomplete and does not contain your legacy data, you are unable to ensure that every related factor is considered in assessing risk in existing and new agreements. If legacy contracts are still active, they will include risks to your current operation of which you are not aware. In addition, legacy contracts may provide vital information about past relationships with other parties, which can be used to inform the negotiation of new contracts. Legacy data can provide vital lessons that need to be carried forward in your contract procedures, but these are unavailable if they are not included in your Contract Management Software.
The bottom line
The inclusion of legacy data in your Contract Management Software seems like an arduous and time-consuming task – and it almost certainly is – but this effort to include the past in your Contract Management System is an investment in the future of your business. It ensures that all decision pathways are fully informed, and all risk is truly mitigated. The purpose of Contract Management Software is to tighten up your Contract Library, and to reduce costs to your enterprise – but failing to include legacy data is the quickest way to undermine such progress.
Savings may be made by the installation of Contract Management Software – in personnel time and skill, and also in premises costs – but issues arising from, or relating to legacy data can be even more costly than your old, manual Contract Management System. Personnel time and skill is expended if staff have to track down legacy data to deal with an issue. Most importantly, with your new system unable to help you fully mitigate risk, legacy data can give rise to unexpected legal costs, due to a lack of Contract Management in older documents.
These issues are avoided by investing the time and skill required to track down all legacy data in your business, review it, investigate its financial implications, and digitise it into your Contract Management Software system. The initial outlay associated with this task may seem steep, but the benefits will be visible in your bottom line soon enough once the job is complete. Then begins the work to maintain the Contract Management Software – and this, too, is made easier by having the benefit of a complete and accurate centralised Contract Repository.
Contact Symfact today to discuss your legacy data challenges, and to arrange a demonstration of our Contract Management Software package.