How Does Contract Redlining Software Help To Modernize Contract Negotiations

How Does Contract Redlining Software Modernize Contract Negotiations?

In this blog post, we'll discuss how organizations can achieve a competitive advantage during contract negotiations by adopting contract redlining software. 

When it comes to business deals, two heads are better than one. But when multiple parties collaborate on the negotiation table, it further complicates creating a mutually beneficial agreement. Every stakeholder has input, and the contract managers move from one recommendation to the next to keep track of everything. It is a tiresome process, especially when done manually.  

That is why enterprises with growing portfolios turn towards contract redlining software to negotiate contracts. It enables the parties to effectively work together to reach their intended outcomes at the negotiating table. Additionally, businesses would avoid suffering losses due to inadequate contract management processes. This blog post is your guide to contract redlining software and its applications in contract negotiations. 

What is contract redlining software? 

Contract redlining software enables users to track the changes and revisions in legal documents. During contract negotiation, different stakeholders discuss the content of the contractual agreement. They must agree upon the terms, wording, and language to finalize the contract. Each party makes redlines to denote the alteration they made to the legal agreement.  

Once all the approvers accept or reject the redlines, the contract is signed and executed. One truly digital solution to facilitate redlining a legal agreement is contract redlining software. They offer a single platform for numerous users to add, edit, and remove content from the contract. Moreover, it allows the legal department to keep track of the changes in real time without unnecessary delays.

Automated Contract Management System

What are the challenges involved in contract redlining? 

Before the advent of digital contracting solutions, organizations depended on physical documents and email chains for contract negotiations. Manual or offline contract redlining certainly poses many challenges for the legal department.  

  • Back-and-forth emails to communicate changes can lead to a long and convoluted negotiation process.  
  • Diverse modes of communication and systems make it hard to ensure all the stakeholders have access to the current document.  
  • Offline contract negotiations can lead to an increase in time and contract risks.
  • When organizations negotiate agreements through various platforms, it is hard to establish compliance and consistency.  
  • Lack of version control during contract redlining paves the way for unnecessary errors and miscommunication.  

However, organizations can readily resolve the above issues using contract redlining software to expedite contract negotiations.  

How does contract redlining software help with contract negotiations? 

Typical contract redlining software or digital redlining enables users to collaborate on a legal agreement in real-time. They can alter, make comments, and reject changes within a single contractual agreement. There is no need to send emails or physical copies to negotiate deals. The entire negotiation process progresses through a digital platform with unlimited access to relevant stakeholders.  

  • Auditable visibility 

While employing offline or manual means of redlining, organizations cannot efficiently track the progress of modifications introduced to the contract. Although they receive the finished text, the entire history of how they got to the end is lost within the process. Whereas contract redlining software keeps track of all the changes made to the contractual agreement. Users audit the trail of contract negotiation within the platform. It means there is lesser scope for error and duplication in the business agreement. When all the real-time changes are readily available to the stakeholders, it accelerates the entire contract lifecycle.  

  • Compare contract versions 

Contract negotiation is never a straightforward process for an organization. Sometimes third parties introduce business agreements to a company, or businesses must refer to previous documents to negotiate a deal. In any case, document comparison comes quite handy to the managers during the contract negotiation process. Manually going through endless documents to record the changes is not an administrative task worth legal’s time. That is why organizations prefer to use digital redlining to compare contract versions. With the click of a button, users can document all the differences between two contractual agreements. It is especially useful to ensure that enterprises do not lose relevant clauses during the negotiation process. They can easily identify missing terms or deviations.  

  • Version control 

For the contract negotiation process, version control is tracking and managing the changes made to a legal document. When organizations employ contract redlining software, they do not have to worry about multiple versions of a business agreement roaming around. All the negotiations and suggestions happen within a single digital document. The users can easily refer to the version history to manage the alteration. Moreover, it ensures that all the stakeholders have access to current and accurate contractual agreements. There is no risk of an inaccurate or wrong version of the document getting to the approval stage. The organization has complete control over the contract, no matter how many parties are involved in the negotiation process.  

  • Accountability 

Often numerous parties are involved in discussing and approving a business agreement. Tracking suggestions and modifications made by each stakeholder is a hefty process. Since the content of a legal document is extremely pertinent to the very existence of a business relationship, organizations cannot play fast and loose with the negotiation process. Hence, enterprises require contract redlining software to instill accountability and efficiency in contract negotiation. With digital redlining, users can easily identify who made what change to the legal document anytime they want. So those present at the bargaining table are answerable for even minute alterations.  

Now we know why businesses prefer contract redlining software to optimize contract negotiations. But contract management software makes it one step further to expedite the contract redlining process. Keep reading to find out how! 

Contract Lifecycle Management on Office 365

What are the benefits of contract redlining in contract management software? 

Contract management software is particularly suitable for digital redlining because it has added functionalities for contract lifecycle management. Organizations can automate contract lifecycle, including negotiations, in a single system. Whereas, firms using contract redlining software will have to find alternative solutions to manage other contract stages. Here are some of the benefits of employing contract redlining through a contract management system. 

  • Centralization 

Contract management software holds all the relevant templates, executed contracts, and relevant documents in a centralized database. Fast-tracking contract redlining through a contract management platform allows the users to make use of this data to expedite the negotiation process. They don’t have to switch between platforms to find necessary information during the review and bargaining stage.  

  • Enhanced collaboration

While contract redlining software offers room for collaboration during the negotiation stage, contract management solution makes it even better. All the relevant stakeholders can access, review, alter, and share the contractual agreement from within a single platform. The centralized platform makes it easier for the sales, legal, and procurement teams to collaborate on an agreement.  
  • Reduce contract lifecycle time 

In contract management solutions, there’s no waiting around for contracts to pass through stages. Organizations can easily track the document throughout the contract lifecycle and receive automated alerts for its progress. Moreover, once the contract goes through contract redlining and approval workflow, users can get it straight to counterparties to get signed and executed. There’s no delay or jumping platform to get from one contract phase to another.  

  • Insert clauses 

Contract redlining through a contract management system provides organizations with unlimited access to the extensive clause library. The digital storage contains the pre-approved selection of sought-after terms and stipulations. During the contract redlining process, users can easily insert clauses from the library to accelerate the negotiation phase. They can leverage this intelligence for speedy review and approval. 

  • Document status

Making sure that all parties are on the same page regarding the specifics of the contract is one of the main aims of the negotiating stage. It is hard to achieve that with offline redlining or email chains. Employing a contract management solution to redline contracts enables users to closely monitor the progress of a legal agreement through the contract lifecycle. Contract managers can set up automated reminders so that all the relevant stakeholders are updated anytime an alteration is made to the contractual agreement. Therefore, no party is left ignorant of the document status of a contract.  

  • Improve user experience 

Contract management software empowers organizations to create, edit, and send contract drafts from within a single platform. Apart from improved efficiency and productivity, contract redlining through contract management software also enhances the user experience for counterparties. The system makes it much easier for the stakeholders to collaborate and negotiate with the organization to finalize a business agreement. 


Contract redlining software is slowly but surely replacing all the manual methods of contract negotiations. It makes it possible for the users to edit, remove, and add to contractual agreements from within a single document. There are no physical documents or multiple versions to slow down the negotiation process.  

Therefore, adopting a contract management solution with redlining capabilities is an apt choice for any organization. Organizations prefer a single platform to take care of all their contracting needs. It instills productivity and efficiency among the users. Contract management software offers users complete control over the contractual agreement as it progresses through the negotiation stage. From a single system, they can oversee the changes and version history of contract drafts. Moreover, they can reduce the end-to-end time by getting it directly to the counterparties for e-signature within the contract management platform.  

Explore the possibilities of contract management software by booking a live demo today! 

Disclaimer: The information provided on this website is not intended to be legal advice; rather, all information, content, and resources accessible through this site are for purely educational purposes. This page's content might not be up to date with legal or other information.
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Written by Deepti Gopimohan

As a creative content writer, Deepti has spent years assisting brands to share their unique voice with audiences, complying with the latest marketing trends and strategies. Her educational background in Literature & Journalism has helped her research and publish content for diverse industries & mediums.
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Reviewed by Naveen K P

Naveen, a seasoned content reviewer with 9+ years in software technical writing, excels in evaluating content for accuracy and clarity. With expertise in SaaS, cybersecurity, AI, and cloud computing, he ensures adherence to brand standards while simplifying complex concepts.

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