Business Finance

Importance of Contract Lifecycle Management

Regardless of what you do as a business, chances are you may regularly enter into contracts with other parties. We don’t need to tell you that the more contracts you have, the higher the revenue you will gain. But are you managing your existing agreements in a way that allows you to maximise this?

As a result of lousy contract management, companies can lose nearly 10% of their total revenue. The most common reasons for this include:

  • The time needed to file, store and copy contracts
  • Lack of payment or price tracking leading to problems with revenue
  • Delays in approval which can reduce your productivity and annoy your clients
  • Poor management of contracts resulting in compliance issues or the use of incorrect information

Fortunately, the rectification of these issues is simple using contract lifecycle software.

What are the Benefits of Contract Lifecycle Software?

1. Tasks are Standardised From Beginning to End. Typically, the contract management of a sales operation involves five steps. Firstly, the CRM is used to generate a quote. Then the customer is required to e-sign the contract to make it official. Once the sale is complete, and the customer has their goods, their details remain stored on a database, and enterprise resource planning software manages the contract going forward. The issue with this process is that it uses multiple software platforms. Contract management software is different because it handles all these steps in one place. Helping make communication with your clients quicker and enabling you to keep on top of tasks. Missing deadlines becomes a thing of the past, and information is instantly accessible in just a couple of clicks. 

2. Manual Tasks are Reduced. Contract lifecycle software removes the time and hassles out of contract management. Contracts can be sent to customers for them to sign. Approval and renewal notifications can be sent to the appropriate parties and contracts can be stored safely once approved by the customer. Contract management software helps ensure no critical stages have been missed and helps reduce the time and effort needed to manage contracts manually.

3. Everything Becomes Automated. Contract management often requires the management of many intricate details at each stage of the process. Contract lifecycle software automatically manages this. It doesn’t matter where details are stored. The software will be able to access them. 

4. Personalisation of Contracts Simple to Achieve. Finding information within a contract should be easy to achieve. After all, contracts often demand frequent updates. So the last thing you want is having to trawl through documents and make edits manually. Contract management software allows the effective management of multiple contract drafts, making the entire process more efficient and accurate.

5. Success can be Measured Easily. Contract lifecycle software contains analytics tools, allowing you to discover how well contracts are moving along. It could be that through using analytics, you find out that one stage in the lifecycle has become delayed. This can help drive future efficiencies and change. This is particularly useful for managing many different contracts.