Top 4 Reasons to Invest In Contract Management Software
Efficient contract management has a way of affecting various aspects of the business, from workplace productivity and improved communication to better spend management. Here are some of the top reasons companies value their contract management software investment.
Simplify Contract Management Processes
Some companies worry that they will lose too much time learning a new contract management system. True, some software options are more complicated than others. But what some administrators or contract managers overlook is that avoiding a software solution can also lead to lost time. Different departments may develop their own approaches, so that the organization overall has various localized systems but no definitive agreement on “how things are done.” People working between departments must remember minor differences in how to label, store, and share important information. Errors can easily result, even if each individual department functions on its own and believes it is organized.
An organization-wide shared system with a user-friendly interface can implement clear, standard contract management procedures. Employees can learn to navigate the new system in about 15 minutes. Eliminate clumsy email exchanges and makeshift reminders for contract review. Automate and standardize as much as possible.
Balance Efficiency and Risk Management
The sales team of a company wants to close deals quickly to meet or exceed quotas for the quarter. The legal team wants to conduct thorough reviews of every word to ensure compliance standards are met and liability is minimized. Departments can run into conflict over their different goals, or they can rely on each other’s strengths to improve contract processes throughout the business.
Contract management software can make it easier for departments to balance multiple priorities. Storing files in a secure cloud system, using two-factor authentication, and linking contracts with compliance protocol documents can help the legal department feel confident about managing risk and compliance. Sharing updated files with a few keystrokes and streamlining signing with electronic signatures keep contract negotiation and signing moving efficiently.
Make Searching Easy
Even a sophisticated email inbox is no match for a program designed to organize contracts. Many companies that don’t use contract management software opt for one of the following common DIY solutions:
Emailing contracts and storing them in inbox subfolders. While email allows some basic keyword searching, you’d then have to weed out unrelated emails, and risk missing an important exchange due to a typo. There’s also no room to refine a search or reorganize results.
Saving contracts to a local drive and managing them via spreadsheet. Even if the spreadsheet is shared in the cloud, most information must be entered manually, increasing the risk for errors. It can be difficult to predict what search parameters are necessary when designing the spreadsheet, so search capabilities may be limited.
Storing hard-copy contracts in filing cabinets. This is one of the most challenging systems to search. One assistant’s mistake can cost hours of wasted time tracking down a misfiled contract. Faxing or mailing copies for signing can be a lengthy and cumbersome process.
With a contract management software program, it’s easy to tag contracts when you upload the file. Admins can even make certain search parameters required fields to enter in order to save the contract, ensuring that all files are tagged appropriately. Users can run basic or advanced searches to access the files they need, save search results for future reference, and sort search results in multiple ways that DIY systems or inboxes don’t allow. It’s easier to locate the information you need and arrange it in the way that makes the most sense.
Stop Missing Negotiation Opportunities
One of the most important reasons businesses invest in a contract management software solution is to identify more revenue opportunities and manage spend more effectively.
Contract renewal is an important time to negotiate a financially advantageous deal. Missing a negotiation period can trigger auto-renewal, and a missed opportunity to save money. Effective contract reviews also help identify redundant and under-performing contracts. Finally, by improving contract access and communication within the organization, contract management software can be a tool to prepare a stronger negotiation platform for other business opportunities.
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