For the lasting success of a non-profit organization, it is important to have an effective, excellent team. When that is in place, non-profit CEOs can go into their core objectives in full power.
In this blog, we discuss 12 very important contract management tips for every non-profit CEO. There is no shortcut to success, but you can fine-tune your NPO’s efficiency by handling contract management processes with utmost caution.
Contract management efficiency is critical to the success of a non-profit organization. A contract management software designed and developed specifically for NPOs can make a big difference at this stage.
Let’s dive straight into the contract management tips.
One of the first things you should check is the contract duration or term. It is critical to know how long the contract will be valid. Only if you know it, you can analyze whether it is in your best interest or not. If not, you must take the necessary actions to correct it.
The validity of the contract is also an important factor you need to consider being a non-profit’s CEO. As the validity of the contract depends on various clauses, provisions, and various other factors, making clarity on the possible duration of the contract is critical.
As part of taking full control over the contracts in your NPO, you need to know what happens once the duration of the contract comes to an end. Make a detailed understanding of the renewal process. If there is an auto-renewal option, see how that works and under what conditions. If the contracts are getting expired, see what is the workflow that determines their status after that.
With proper contract management software in place, you can set up the renewal process in the way you desire. Moreover, you will get notified about the renewal dates in time.
Contract termination is also an important process that determines the effectiveness of your contract management process. Know the contract termination terms. Think about the possible challenges and risks right from the start and include such terms carefully. This will be helpful in case any unfortunate situations occur.
You should know about the notice requirements, payments after termination, and possibilities for sure in case of a termination situation.
Indemnification is also another critical area to be very cautious about when engaging with another party through a contract. Indemnification is a legal provision by one party to hold another party not liable for any losses or damages that might occur as part of the collaboration.
This allows allocating risks and losses in the right balance between the two parties. Indemnity provisions vary widely according to subjects, terms, and conditions. However, knowing these provisions allows you to maintain a healthy contract status.
Knowing the Indemnity provisions helps you to negotiate the provisions if there is something that is not favorable for your organization. If you see that the indemnity provision is not applied for a balanced mutual risk, negotiate to equalize the risk points. There are also a few nexus phrases you need to look out for. For example, phrases like ‘related to’ apply a wider impact than words like ‘solely resulting from’, and ‘caused by’. Wider impact phrases cause more indemnity than other phrases.
To get all data related to the intellectual properties mentioned in your contract, you need to find answers to all questions. Intellectual properties refer to the ownership and allowable use of different assets. The most important questions regarding intellectual property are related to who owns the property, and who is authorized to use it. You should know about additional costs and extended use policies as well.
In normal cases, people usually do not read all terms and conditions mentioned in a contract. It might be too long but as a CEO of a non-profit organization, you need to read the contract completely. Make sure you understand every detail of the agreement. Discuss it with your team and ask questions if you need more clarity. Make sure you do not skip any part of it.
If you are not satisfied with any of the terms or charges mentioned in the contract, negotiate until you reach a reasonable point. Always remember, if the party wants to collaborate with you, they will be reasonable in all terms. Do not hesitate to disagree and ask for reasonable terms and costs whenever needed.
As the number of contracts in your organization increases, it will become difficult to handle them on your own. At that point, it is highly recommended to hire a dedicated contract manager. These dedicated people will be able to handle all challenges regarding contract management with ease so that you can spend your quality time and energy in other critical areas.
The smartest decision you will ever take regarding managing non-profit contracts is to get a contract management software. Even after you hire a dedicated contract manager, there will still be possibilities for human errors and limitations. Whereas a specially designed contract management system for non-profit organizations can avoid even such limitations. This will help you run your contracts with utmost efficiency.
CMS solutions come with all kinds of advanced features dedicated for every contract management process. However, there are a few key objectives you need to be aware of. First, your priority will be to keep all your contacts organized and access them all from one page. Microsoft 365 and SharePoint-powered CLM software will be the right choice for that. E-signature integration, report generation, contract workflows, and customization features are also important features for a modern contract management solution.
Furthermore, if you want to be successful with a CLM system, you need to study its possibilities and capabilities well. Do thorough research about how CLM solutions can enhance contract management for NPOs.
You can also book a live demo of Dock 365’s contract management solutions here so that we can show you how our CLM software helps NPOs achieve the utmost contract efficiency.