12 CLM Implementation Roadblocks and How to Fix Them

Contract lifecycle management software offers quicker approval cycles, enhanced compliance, and increased contract visibility. Still, there are numerous instances where these systems fail post-deployment. Legal departments expect results, but experience delays in workflow processes instead.

Why Does CLM Customization Become So Complicated?

This issue does not arise due to technology itself. Almost every business operates on Microsoft 365. But contracts continue to be managed via email, spreadsheets, and fragmented folders. This causes chaos in legal, procurement, finance, and sales departments.

Why is it difficult for businesses to implement contract lifecycle management software?

Because most companies try to integrate non-standardized processes into automation.

The positive aspect is that these obstacles can often be avoided easily. Companies that utilize Microsoft 365 have access to proven tools and system benefits. It's essential to develop workflows that align with existing procedures.

Here are the top twelve challenges of contract lifecycle management software and their solutions.

Inconsistently Defined Processes Prior to Implementation

Most of the time, CLM fails before anything gets implemented because organizations start with automating inconsistent processes.

For instance, legal departments follow one process for approval, whereas procurement departments follow another process. The finance department can also be following a totally different contract management process.

Moreover, if everyone is confused about what needs to be done at the end of the day, then employees do not know what to do.

One solution would be to map the process beforehand, before anything else is done. This way, the company can document the various stages of the approval process, types of contracts being signed, and other important things.

In a Microsoft environment, collaboration between departments comes easily.

Overly Complex Customization of Contract Management Software

Though customization is appealing at first glance, it quickly becomes one of the main obstacles.

First of all, each department wants a highly customized process flow. It means separate configurations will be required by legal, procurement, HR, or finance departments.

Another issue is the confusion between flexibility and customization. The latter typically means increased expenses for support and maintenance.

Why is it complicated to customize contract management software for teams?

Contract management approaches differ across departments. While some prefer fast processes, others emphasize compliance considerations. Attempts to address all possible requirements lead to cumbersome solutions.

It makes sense to implement phases of customization. First, it is necessary to focus on key requirements, followed by expansion.

Microsoft 365 solutions provide easy customization opportunities thanks to SharePoint, Teams, and Power Automate.

Resistance to Workflow Adoption for Teams

Implementation of technology is often underestimated, and many organizations struggle with employees sticking to their old ways even when they have implemented a CLM tool.

There are employees who would rather rely on email and spreadsheets, and there are people who find it difficult to log into yet another platform.

It should be noted that workflow adoption resistance does not come from a lack of desire but rather stems from usability issues. Teams tend to dismiss any solutions that disrupt their daily routine.

It is important to integrate workflows according to current employee behavior. The integration with Microsoft 365 becomes highly relevant in this case because the majority of employees use these tools every day.

Contracts should not appear on another isolated platform but must be visible in an environment that employees are accustomed to.

Challenges of Integrating Contracts into Existing Systems

Contracts can be linked to a number of business systems at once. Procurement software, CRM, ERP, and accounting solutions all need contracts.

Disjointed systems will cause redundant data and inaccurate information. Employees have to spend time searching for data across different applications manually.

Connecting the system is difficult because old infrastructures cannot support modern technology. Outdated software usually doesn't provide the means of connectivity anymore.

Companies also over-integrate their systems from the very beginning, leading to complicated projects with longer deadlines. The approach should be strategic. High-impact systems that interact with contracts should be integrated first.

Microsoft 365 solutions are designed to work smoothly with other Microsoft software due to the Power Platform solutions.

Inadequate User Training and Change Management

Organizations underestimate the significance of user training and change management. Employees are trained on basic software operations without any guidance regarding operational procedures.

Employees might be familiar with software operations but lack an understanding of workflow requirements, resulting in inconsistent contract processing within departments.

User training should involve practical scenarios rather than technicalities. Training should emphasize workflow advantages and responsibilities for employees.

Leadership support is equally important during CLM system implementation. Adoption rates increase rapidly where organizational leadership embraces operational change. Employees act as internal promoters during the transition phase. They assist fellow employees in answering questions about workflows.

Brief training modules are more effective than lengthy classes. Employees assimilate practical knowledge through small modules during training.

Ineffective Cross-Departmental Coordination

CLM implementations tend to become solo legal department projects. But contracts impact virtually all operational processes throughout the organization.

Procurement departments value supplier agility, whereas the legal department values risk mitigation. Finance departments emphasize compliance issues, among other factors. Different objectives slow down decision-making processes.

There will be no alignment between departments, resulting in the formation of distinct processes outside the CLM system. Organizations need to define a shared implementation goal early on. Defining KPIs will allow departments to recognize common objectives across workflows.

In addition, governance meetings will help ensure alignment throughout the implementation phases. Departments can identify workflow issues before they evolve into major organizational concerns.

Finally, Microsoft 365 collaboration tools facilitate better inter-departmental communication automatically. Enhanced visibility promotes accountability in the implementation phase.

Migrating Legacy Contracts and Historical Data

Migration of legacy contracts causes substantial implementation delays. Organizations usually underestimate the effort required for historical contract migrations.

Important agreements may be stored in shared drives, emails, filing cabinets, or even isolated folders. Inconsistent metadata further complicates the migration process.

Some agreements may also have no defined expiration date or owner. This compromises data accuracy post-migration. The ideal course of action includes phased migration planning. Organizations can prioritize active agreements and risky contracts accordingly.

Moreover, data cleansing should take place prior to migration. Departments need to standardize naming conventions, metadata schemas, and classifications carefully.

Additionally, AI-based metadata extraction can streamline manual tagging. Automated metadata captures improve repository searchability.

Excessive Complexity in Approval Workflows

Some companies establish overly complicated approval processes. Too much scrutiny is an unnecessary slowdown in contract signing.

Employees will ultimately skip these workflows to avoid any delays. Such actions will lead to non-compliance and chaotic documentation. Rigid approval processes also fail to address different types of contracts appropriately. Vendor agreements need different levels of approval than employment agreements.

Instead, dynamic workflows should be designed. The approval process should change depending on contract type or size automatically.

Notifications also contribute to eliminating approval bottlenecks. Users react more quickly to reminders that are shown within the Microsoft environment.

Dynamic workflows do not slow business operations while preserving compliance.

Limited Ability to Monitor Obligations and Deadlines

Despite the implementation of CLM systems, some companies fail to respect contract deadlines. Poor visibility is an operational challenge here.

Companies usually use calendar notifications or manually prepared spreadsheets. The result is inevitable - missed renewals and compliance issues.

Managers also experience difficulties getting quick access to reports. Contract-related data stays scattered among various departments and systems.

Organizations require automated alerts and dashboard visibility for better accountability throughout the lifecycle of the contract.

Microsoft 365 provides better reporting visibility in terms of integrated dashboards and workflow notifications. Teams get easier access to contract status updates daily.

Scalability Problem Between Departments

Some CLM implementations become successful at first, but there are difficulties when implementing scaling phases for the organization.

HR, procurement, legal, and sales have different ways of handling their contracts. No single workflow model fits all departments well.

Reusability in building components for workflow models helps organizations implement better in the future.

Department-based flexibility is still necessary as well, since workflow changes must be done without compromising the overall governance policies.

By adopting phased approaches in scaling implementations, organizations get reduced pressures in implementing workflow models for their CLM platforms.

Insufficient Utilization of Reporting/Analytics Capabilities

Some organizations spend millions of dollars on their CLM platforms, yet they are not making good use of their reporting capabilities.

They may only focus on document management and signing functions provided by CLM systems. That makes it hard for organizations to measure their success.

Reports must be easy and practical to use by business users. Complex reporting discourages non-tech teams from using it regularly.

Businesses need practical metrics initially. Contract cycle times, renewal times, and approval bottlenecks are relevant to business operations.

Power BI integration into the Microsoft ecosystem makes analytics more accessible as well. Visual dashboards make it easier for management to pinpoint workflow inefficiencies.

Analytics become useful when they can be used to make real business decisions.

Inappropriately Picking a CLM Platform

Sometimes, organizations consider only features when picking CLM systems. However, CLM architecture flexibility is much more critical during implementation.

Inflexible platforms become challenging to implement as needs change. Organizations inevitably outgrow the CLM system that lacks flexibility.

Why do companies have difficulties with contract management software?

Some platforms add extra complexity to processes rather than solving problems. Therefore, employees avoid using systems that seem irrelevant to the environment in which they work.

Platforms that integrate with Microsoft 365 give organizations an advantage in this regard. People already know about the environment, its architecture, security, and collaboration capabilities.

The ideal CLM solution should accommodate growth while minimizing technical complexities for end-users.

How is a CLM Solution Implemented Successfully?

Problems with contract lifecycle management solutions seldom stem from the technology itself. Instead, the majority arise due to workflow complications, low adoption rates, and siloed processes.

Companies that utilize Microsoft 365 already have an efficient foundation established. Commonly used applications such as Teams, Outlook, SharePoint, and Power Automate make the process much easier.

Successful CLM solutions emphasize ease of use over extensive customizability. It is more focused on workflow optimization than feature expansion.

Phased approaches also prove effective for legal and procurement departments. Small changes yield higher adoption rates than radical implementations.

The ideal contract management solutions align with how the workforce functions on a regular basis. This fosters faster adoption, greater visibility, and consistent operations.

Microsoft 365 users can benefit from contract lifecycle management through Dock 365. Its native design makes it easy to implement, customize, and scale.

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