According to the International Association of Contract and Commercial Management, research shows that “improving contract management can increase corporate profitability by nearly 10 percent annually” (Silverman, 2020).
Using contract management software for managing contract lifecycles will help your company’s legal operations the following ways:
Now that you know how contract management software can benefit your legal operations and improve overall results, what exactly does contract management software do and what functions does it serve?
By default, contract lifecycle management software will make sure that every contract is sent through a single system so that your company can effectively manage each step with complete visibility. In this way, your legal team can easily find where a contract is located within its lifecycle. Legal operations departments and General Counsels are now able to refine and enhance their systems because of the increased visibility from the technology provided by contract management software (Silverman, 2020).
Contract lifecycle management software performs several tasks that profoundly increase productivity and efficiency for your legal team. For example, sorting through a high volume of contracts, auto-tagging agreements for process and review, and flagging high-risk terms and clauses are just a few of the functions that this software will serve that will alleviate the demands imposed on your legal department. By using proper technology legal departments and General Counsels can increase work efficiency by allowing software to bear many of the tedious tasks that previously were only completed by humans. In this manner, contract management software reduces labor, saves money, increases time-efficiency, and improves all the contract processes that span across your company overall (Silverman, 2020).
Human error is unavoidable, but you can greatly reduce these errors with contract management software. However, one key point is true about human error: it costs time and money. Maximize your company’s invested time and money by utilizing automation capabilities provided by contract management software.
Specific contract lifecycle management software works to safeguard against penalties and non-compliance when working with contracts. Artificial intelligence is also a great tool for reviewing contracts because it allows legal operations teams and General Counsels the ability to tag specific clauses and contract terms that require more attention during the review process (Silverman, 2020). In this way, contracts continue on their lifecycles faster. The automation helps to prepare teams by anticipating contract problems prior to their occurrence. It truly is a win-win, where efficiency in the legal department is optimized.
Legal operations personnel can now use contract management software for entering legal requests and for submitting the requests for approval in a streamlined fashion. With a contract management system, entering data for request records becomes simple. In addition, request communication follow-ups are decreased in time due to the system because it gives software users the ability to review, gather, store, and easily approve any automated contract request (Heck, 2021).
Risk is greatly reduced by using contract management software because contracts are unable to be stolen or physically destroyed. This is a great step because digital storage saves time and is considerably more secure. However, on the contrary, cyber theft serves as a potential threat that requires your legal team to enforce several layers of security for contracts. Nevertheless, with appropriate contract management software, document security is guaranteed (Silverman, 2020).
Having a library of current contract templates and clauses is one of the best aspects of contract management software in terms of the role is plays for legal operations. This provides your company the ability to update the library as needed, ensuring your team only utilizes the most up-to-date files. Additionally, having such templates and clauses helps to improve and enforce “pre-approved legal language,” creating a clearer understanding in your employees on which contracts, clauses, and terms are usable (Contract Logix, 2018).
Prior to taking the leap and adopting contract lifecycle management technology into your current contract management process, it is necessary to consider the following:
Delegate Contract Lifecycle Management to a Staff Member
After the contract lifecycle management software is successfully installed, choose an employee to be responsible for the implementation phase of the technology.
Select the Correct Software for the Job
Determine what blind spots and areas of improvement exist in your current contract management process. Are there areas that should be automated instead to increase efficiency and productivity? We highly suggest taking automation into great consideration when choosing contract lifecycle management software.
Consider Your Organization
Does your organization or business consistently process various types of contracts? If so, contract lifecycle management software will greatly protect and streamline any of the following types of contracts and agreements:
While contract management software serves to propel work-efficiency forward in all parts of the contract management process, a company’s legal operations is the one of the most opportunistic areas to apply such software.
If your company has contracts that are high in volume and/or risk, contract lifecycle management software can help in streamlining all the details tremendously. Enhance your entire process by creating vast improvements in the legal operations within your contract management system. By centralizing your library of template and clauses, you greatly reduce negotiation times and increase accuracy and customizability while keeping legal implications in check. Start with contract management software today so that you can tangibly see major gains in the efficiency and productivity of your legal department and to surge your ROI.
Contract Logix. (2018, November 27). Improving Project Success with Contract Management Software. Contract Logix. https://www.contractlogix.com/contract-management/improving-project-success-with-contract-management-software/.
Heck, S. (2021, May 11). How To Improve Legal Operations With Contract Management Software. https://s3.amazonaws.com/documents.lexology.com/fce8cdc7-6bba-47a1-b3e9-b3dbb5218876.pdf?AWSAccessKeyId=AKIAVYILUYJ754JTDY6T&Expires=1622568763&Signature=hkP7mj1eEOkZIMuTcvfS6%2BNTS%2Fg%3D.
Silverman, A. (2020, January 9). How Contract Management Software Improves Legal Operations. Contract Management Software. https://www.contractworks.com/blog/how-contract-management-software-improves-legal-operations.
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