Contract management proves to be a time-consuming element of business and this requires an effective and automated contract maintenance software. When two organizations desires of engaging in a business activity with the other, a contract expresses the activities that are to be engaged in by both organizations and the terms by which each party will fulfil their part of the agreement. If a contract is not worded or phrased properly, it might result in the organization losing thousands of dollars.
Areas of Contract Maintenance
A business standard contract maintenance software typically focuses on the following business disciplines:
Authorization and negotiation;
Baseline Management;
Commitment Management;
Communication Management;
Contract Visibility;
Contract Compliance or governance
What are the challenges faced in Contract Management?
The legal department usually takes care of the contracts that are entered into between parties. unfortunately, when there are numerous files to be managed and that too manually, the contract management process is bound to face bottlenecks.
Also, manual contract management is bound to introduce errors. A lot depends on the legal team and if they are not able to catch the mistakes, then it might lead to the creation of a havoc situation for the entire firm. The common mistakes that are bound to occur are as follows: legal compliance; revenue leakage; extended sales cycle times; jeopardized customer relationships.
1. Consolidation:
Have one central repository for managing all aspects of the contract, which includes templates, clauses and exceptions. Single source of view can help in viewing, managing, updating and searching contracts for necessary and accurate information.
2. Task automation:
Have an automated manual process that helps in freeing time for lawyers to focus on more essential and special case contracts which are relevant to their expertise. Task automation helps in increasing control and reduces the number of errors and also helps in speeding up the contract cycle time.
3. Process Efficiency:
Efficiently handled process frees up more time for all involved stakeholders - like the sales, finance and legal departments and thus allows them to spend more time on those tasks that correlate to their expertise and job profile.
4. Contract Performance:
As a company, one is always expected to grow but the level of performance delivered to be remaining the same. Having an automated contract maintenance software will help in providing more visibility into the contracts and also help identify the gaps and pain points, thus helping in providing the best service to your customers.
To conclude, while the tradition normally is to manage contracts manually, that practice is riddled with inefficiencies that can only deter a company's overall profitability. Integrating with an automated contract maintenance software software will help in reducing countless man hours and automate associated processes and build up the value of the company.
