Contract management is a critical aspect of any organization’s operations, and it’s especially important for executives who are responsible for managing the financial health of their organizations. Effective contract management can help you mitigate risk, increase revenue, and reduce costs, but it can also be a complex and time-consuming process. In this post, we’ll explore the top five pain points that businesses like yours face with regard to contract management, and we’ll provide some best-in-class solutions to help address these challenges.
Lack of visibility into contract terms and obligations
One of the biggest challenges with regard to contract management is the lack of visibility into contract terms and obligations. This can result in missed opportunities to save money, increase revenue, or mitigate risk.
Best-in-class solutions for this challenge include contract lifecycle management (CLM) software that centralizes all contracts in a single repository and provides advanced search and reporting capabilities. With CLM software, you and your team can easily access all contract data, including key terms, obligations, and milestones, and they can quickly generate reports to help them make informed decisions.
According to a report by the International Association for Contract and Commercial Management (IACCM), companies implementing CLM software can reduce contract cycle times by 50% and increase compliance by 80%.
Inefficient contract creation and negotiation processes
Creating and negotiating contracts can be a time-consuming and inefficient process, especially when done manually.
Best-in-class solutions for this challenge include contract authoring software that streamlines the contract creation process and automates workflows – which can easily help you create contracts using pre-approved templates and standardized language, and automate workflows to ensure that contracts are reviewed and approved in a timely manner.
A study by Aberdeen Group found that companies that use contract authoring software can reduce contract cycle times by 50% and increase contract accuracy by 90%.
Poor contract management workflow and process
Inefficient workflows and processes for managing contracts can lead to delays, missed deadlines, and increased risk. CLM software can easily manage contract workflows and approvals, as well as receive automated alerts for key contract milestones and renewal dates.
According to a report by the IACCM, companies that implement CLM software can reduce cycle times by up to 50%, increase compliance by up to 80%, and reduce legal costs by up to 30%.
Poor contract compliance and governance
According to a study by Forrester, companies that use CLM software can reduce legal costs by up to 30% and increase compliance by up to 70%.
While contract compliance and governance can be a complex and time-consuming process. Best-in-class solutions for this challenge include CLM software that provides automated compliance and governance workflows, as well as real-time alerts for non-compliant activities.
Limited scalability and flexibility
Scalability is a concern for any growing business. Solutions like SAP Ariba CLM or ICertis CLM software provide scalability and flexibility, as well as customizable workflows and integrations with other business systems. These will ensure your contract management processes can adapt to changing needs, reducing risk and increasing efficiency.
To learn more about:
Contract management and its impact on procurement click here.
Complex contract management solutions click here.