Should You Be Using a Contract Management Software?

Contracts are not simple anymore. They are highly complex, with several clauses and nuances, like in the case of digital licensing and fintech.

As a result, the cost, time, and effort to manage contracts have increased significantly.

Businesses invest in contract management or contract lifecycle management software to deal with the challenges of contracting. It automates crucial workflows and provides a central interface for all stakeholders to contribute.

You can enjoy several benefits by digitizing your contract management. Let’s discuss the most promising ones in today’s blog.

Speedy Contracts

A contract can take hours to draft. It becomes a problem when your business reaches a certain size, and you deal with innumerable contracts regularly.

Contract management software expedites contract authoring. It comes with customizable templates with a library of clauses for every industry.

You can pick a template and personalize it to meet your contracting needs in minutes. Best of all, you don’t need to be a legal expert to draft a contract. Your software will provide all approved clauses and terminologies to make a professional contract.

The process lowers legal dependencies and improves consistency. You can also automate workflows like generating an amendment letter to save effort.

The Icy Whiz team talked to Vlad Khorkhorov, CEO and Founder of WebsitePolicies, about the flexibility in contract management software. Here is what he said:

“Customization and configurability are essential aspects of ensuring that contract management software remains flexible and adaptable to changing requirements. 

When selecting contract management software, organizations should prioritize solutions that offer a high degree of customization options. This allows organizations to tailor the software to their specific needs, workflows, and regulatory requirements.

For example, organizations may need to create custom fields to capture unique contract data or develop custom templates to standardize contract terms and clauses.

Furthermore, configurability enables organizations to adapt the software to their evolving business processes and requirements.

Organizations should look for contract management software that allows them to configure access permissions, approval workflows, and notification settings according to their internal policies and compliance requirements.

This flexibility pushes organizations to streamline contract management processes and ensure compliance with regulatory standards without being constrained by rigid software limitations.”

Quicker Approvals

Contracts need approval from designated parties before you execute them. It can take several days as approvers scrutinize the contract document for risks and viability.

A contract lifecycle management solution can help you save precious hours by automating approvals. Moreover, it provides a common tool for everyone to suggest changes or leave comments in real-time.

Every activity is easy to track and leads to better visibility. You can also expect more efficient approvals using automated workflows.

Reduce Risks

Contracts may come with hidden risks at many levels. For example, your document may contain unapproved terms that result in legal consequences.

Contract management software goes a long way to mitigate risks. The pre-built templates with approved clauses help you avoid any unpleasant consequences.

Moreover, you have complete visibility and control over your entire contract management. Therefore, you are not likely to miss out on anything that can lead to penalties or non-compliance.

Additionally, governance of contracts improves to ensure the interests of all parties are protected.

A digital solution even creates an audit trail to allow admins to stay updated of all activities. They contain timestamps and names of persons who performed the change.

Moreover, alerts and notifications help you meet your deadlines.

We interviewed Andrew Pickett, Lead Trial Attorney and Founder at Andrew Pickett Law, on the agility of contract management software. Here is what he had to say:

“Ensuring our contract management software remains agile in the face of evolving regulations and industry trends is paramount.

This agility is achieved through a continuous feedback loop with our users and stakeholders, as well as keeping a keen eye on regulatory changes and industry developments.

We balance the need for standardization, which underpins efficiency, with the flexibility required to accommodate unique contractual requirements by employing modular software design.

This approach allows the core system to provide a stable foundation while customizable modules or plug-ins address specific needs.

Collaboration with legal compliance officers and engaging in proactive legal tech forums helps us anticipate changes and adapt our software accordingly, ensuring that we meet current requirements and are prepared for future demands.”

Secure Document Management

Paper documents and file cabinets are highly risky. Moreover, they introduce countless responsibilities for protecting your contracts.

A contract lifecycle management tool digitizes your paper documents. You can store your files in secure cloud or on-premise storage solutions.

Most importantly, your tool lets you control access with role-based permissions, two factor authentication, and more.

Therefore, no one can modify documents without permission. Additionally, you can share documents with stakeholders using passwords for complete security.

Access control is available at every step of contract management. Moreover, some tools comply with laws like GDPR for absolute compliance.

Lower Contract Costs

Managing contracts manually leads to significant costs. You have to pay several employees to review and author contracts.

Moreover, they have to track changes and deadlines, resulting in hours of work.

Contract management software reduces contracting costs considerably. You can automate your processes and eliminate manual work.

Therefore, you don’t have to pay for the hours you save. Moreover, you can downsize your contract management team to save on labor costs.

Moreover, you can draft contracts and policies in minutes. It also saves labor costs and goes a long way to boost productivity.

Improved Collaboration

Contract lifecycle management solutions act as a central repository of information. You can store your contracts and make them available to different stakeholders.

Everyone can enjoy improved accessibility and an organized way to work on the same document simultaneously. Stakeholders can access documents even if they are in another country, using secure methods.

Moreover, you can enjoy several perks, such as:

• Information becomes easy to search
• Document retrieval is faster
• Quick approvals
• No loss of documents

Businesses can expect a smooth and efficient contract process when they rely on technology.

Transparency

A central hub for all your contracts results in improved transparency. Every document is accessible from a single interface with a record of every amendment.

Moreover, all stakeholders can view changes made to a contract in real-time. The authority responsible for the edit and time are also available for everyone to see.

As a result, businesses can create trust among all parties. Even external stakeholders are able to place their faith in your processes to make the deal happen.

Paper documents can easily be altered, and you can’t view changes in real-time. They are vulnerable to manipulations, and details are easy to miss out on.

Easy Scaling

Contract management software optimizes your contracting processes. You can view every aspect on your contracts from your interface for total control.

Moreover, you have automated crucial workflows like approvals. Now, the whole thing acts as a top-performing machine to help you scale your operations.

You can handle hundreds and thousands of contracts without losing your sleep. It is imperative for big businesses and enterprises that deal with several stakeholders.

A sound contract management process allows you to scale new heights based on solid foundations.

Julia Lozanov, Chief Editor at Verpex, shared her views on adapting contract management software to changing regulations and trends. Here is what she said:

“One key strategy we employ is regular updates and customization of the software to meet evolving needs.

For example, when GDPR was enacted, we swiftly updated our software to comply with the new regulations, ensuring our customers’ data remained secure and our processes aligned with the law.

Additionally, we regularly review industry trends and gather feedback from stakeholders to identify areas for improvement and enhancement in our software, keeping it flexible and responsive to changes in the business environment.

This proactive approach has allowed us to maintain compliance, meet stakeholder expectations, and stay ahead in a dynamic industry.”

Final Thoughts

Contract management or contract lifecycle management software is a boon for modern businesses. It is essential to centralize your contracts and optimize crucial workflows. The solution helps you save time and reduce contracting costs. Moreover, it can improve sharing, collaboration and transparency.

Guest Author: Saket Kumar

Last Updated on May 11, 2024 by soubhik