CONTRACT LIEFCYCLE MANAGEMENT SOFTWARE: 6 QUESTIONS YOU NEED TO ASK
Contracts are the veins of a company. Statistically speaking, contractual agreements account for 60% to 80% of modern business transactions. Only 16% of organizations have developed a CLM system while the rest are still following the equivalent of old-school contracting, where there is no concrete contracting strategy and limited visibility of key contract issues. Without proper functioning and maintenance of contracts one can suffer business and revenue losses on a substantial level. For every business, managing contracts and obligations have now become a critical task. Paper based contracts make one’s job frustrating and difficult. With the age of digitization what once was done in an hour can be resolved in minutes, and so contract management softwares came into being.
Contract Lifecycle Management Solutions like smartContract are now getting popular by the day. They have become a savior in this world of chaos, with streamlined workflows, dynamic dashboards, and obligation management modules. A Contract Lifecycle Management (CLM) software can give you an insight into contract data, ability to collaborate, time and cost savings and better decision-making ability through low risks. The utility of a CLM solution depends on how business information from those contracts are extracted, analyzed, distributed and queried by the people who actually have to administer and monitor the signed contracts. Maximizing their utility means transforming contract language into concise, easy-to-understand information that helps decision makers not only increase productivity but also provide better results.
But as it is said, as the demand increases, so does the number of service providers. Thus, it has become very essential to enterprise and organizations to ask the right questions before deploying any CLM software. The six questions below will facilitate a self-evaluation that will help you identify strengths and weaknesses to look out for in a contract management process.
The first and foremost question one should be looking to get answers to is, “Where are the documents stored? What type of visibility and access do they have if so?” Usually CLM softwares like smartContract provide a repository to store all your drafts, revised or archived contracts and agreements and you also get permissionable access; only authoritative person with viewing rights can access the particular contract. What makes smartContract even more standing out from the crowd is the Free Word Search feature using a fast and accurate wizard that can search even within the contract documents in readable word and pdf formats; enabling you to retrieve and view the documents easily.
Does the contract lifecycle management software have a standardized, permission-based process for clients, customers, vendors, suppliers, etc. To request new contracts? Businesses if satisfied with your services may want to extend the association; advanced CLM softwares like smartContract provide you a means of doing just that. SmartContract also helps you out with prioritizing contract requests based on user defined criteria and Turn Around Time. The TAT helps set a deadline due for the request, if a manager happens to skip or forget about it, the request is labeled an overdue task. Leading to multiple alerts being sent to the manager to start with the process; thus allowing your managers to quickly make decisions about which contracts to proceed with first.
Do you have a flexible authoring environment with easy to make changes through editing, drag and drop, and other time-saving capabilities? Also, does this platform support collaborative authoring or not? So that when required you can get your legal team involved in reviews as well. SmartContract’s built in feature of Clause Library can save you loads of time. In clause library, you can save your favorite or important clauses from any document and then later use it for another contract, if applicable.
What is the approval procedure? Are you able to manage the approval process with proper reviews while meeting requirements and deadlines? This process should be clearly outlined, and best practice is to create a workflow which ensures that every contract is properly reviewed and approved accordingly.
Do you, with your employees, clients, and vendors have real-time access to contracts? Are you able to easily negotiate alterations and review changes during and after negotiations? With advanced CLM softwares this question is one of the most important ones as only few softwares like smartContract with their Party Portal platform are able to provide the correct means for this. While negotiations many changes are asked to be made and often most are executed. What generates confusion is not keeping up with the changes made separately from the original contract. The Audit trail feature in smartContract helps you keep a track record of all the changes, even after the execution.
Though last but never the least, question that one should definitely ask is does the CLM platform support obligation management? And if so how? With advancing technologies, CLM platforms like smartContract automate your alerts and deadline notification as and when required thus unloading your burden of constant reminders.