4 Must-Haves in Your Contract Management Process
For some business people, dealing with contracts is an unappealing part of the production, sales or fulfillment process. The real job begins, they feel, when the contracts are signed. In reality, contract management before signing must be a priority because nothing works well if this aspect of the deal is not in order.
Users of contract management software leverage such systems to properly generate, review, approve and monitor contracts throughout their lifecycle. Automating these business processes allows contract management professionals to concentrate on higher value work that is vital to growing their companies. At a minimum, your chosen contract management solution should support the following low-effort, high-value scenarios.
All companies would run more smoothly if everyone completed their tasks on time or at least responded to inquiries in a prompt manner. Of course, the reality is that at least one person will likely be tardy with their responses, resulting in an unnecessary and costly delay that rightfully frustrates both parties. Contract management software programs allow users to alert management to a late or incomplete task. This method virtually ensures that the issue will be handled as quickly as possible. Plus, being nudged by software is less threatening to some people than being reminded by other professionals to "hurry up" during a business deal. Escalation paths are an excellent motivation to complete work on time and keep participants equally invested in the process.
When contracts are delayed, it doesn't necessarily mean that the parties are not motivated enough. Instead, it may simply reflect busy schedules. Successful business executives often have an inspiring work ethic that makes them particularly difficult to pin down in person. They travel frequently and participate in hundreds of meetings, so expecting them to respond to workflow processes from their office PC is not reasonable. Quality contract management software allows them to respond to workflow tasks from their mobile devices, including smartphones, laptops and tablets. Everyone involved, including legal counsel, can complete their responsibilities from wherever they are and keep the contract process progressing on schedule while continuing with their other duties.
Actionable Email Messages
Using contract management software is not difficult or time-consuming. You can log into the programs in a few seconds and quickly get to the task you need to complete. But, if you are in the middle of other jobs, even that short time period can be too long. Fortunately, mature contract management software generates actionable email messages. These types of messages allow users to render a response within the email itself, eliminating the need to log in to the application itself. In that way, users can work more efficiently, approving and rejecting contract changes at a faster pace. For busy professionals, every minute truly does count, so actionable email messages are a real help.
Contract management software workflow components essentially break your contract management process down step by step so that it can be automated by the application. Capturing and analyzing performance metrics for how long each step in the process takes can reveal areas for process improvement. For example, when looking at a five-step workflow you see that four of the steps take three days on average but the fifth step takes two weeks on average, you can more easily see a potential area of improvement. Contract managers looking to reduce contract cycle time will find analysis of these types of performance metrics quite valuable.
Contract Workflow Importance
Contracts are a vital part of any business, but creating them can be complicated since they must protect the interests of both parties. Contracts need to be carefully generated, legally vetted, amended, and approved, which is rarely a speedy and problem-free process, particularly when people try to complete it without contract management software. Obviously, speed does matter since the business cannot move forward until the contract is in place and fully executed. Also, as the contract process drags on, additional problems can arise, sometimes leading to the deal being postponed or called off. Many of these problems are related to communication, something that an expedited contract management workflow can improve. Speed, efficiency, accuracy and legality are all enhanced when a business uses software to improve the contract workflow.
For legal professionals, this software removes uncertainty since it leads to a solid contract that protects everyone involved. Others using the software – contract managers, paralegals, purchasing and procurement professionals, sales personnel – are more likely to see the process as a fair and objective one since the program assigns them tasks and deadlines, and they do not feel "herded" by an individual or department.
This software makes the process transparent so everyone is kept up-to-date on the contract’s progress. That means less room for internal misunderstandings and fewer overall delays. When the contract process goes smoothly, it strengthens the business partnership and bodes well for a successful and satisfying result.
If bottlenecks, delays and misunderstandings are still the hallmarks of your contract management process, it’s time to deploy contract management software at your organization.