Companies and organisations are managing more and more complex contracts. Whether it is the production of capital goods, the provision of services or the planning of major projects, a contract is the basis for each of these business transactions. Contracts define time periods, deadlines, rights, obligations and costs in a binding manner. These can be employment and rental contracts, contracts with customers or suppliers, licensing, partner agreements and much more. This means that many people and departments in a company come into contact with contracts – from service to support to marketing. Intelligent contract lifecycle management (CLM) helps to proactively manage contracts with the aim of generating the greatest possible benefit from the content for all parties involved and ensuring comprehensive security. In other words, it is not so much a question of managing the documents, but rather of integrating contract components, content and clauses securely and in a coordinated manner into the company’s processes.
7 phases of Contract Lifecycle Management
The process of intelligent contract lifecycle management is divided into seven key phases: Planning, Implementation, Pre-contract, Handover, Contract, Pre-renewal and Post-contract.
- Planning phase – In this phase, you develop your CLM strategy based on your organisation’s needs and resources.
- Implementation phase – This is where you build your contract management process to implement your strategy, ensuring that everyone involved in the process understands the goals and is familiar with the tools they will use throughout the process
- Pre-contract phase – In this phase, contracts are drafted, negotiated and signed
- Handover Phase – Once the contract is signed, you need to ensure that all stakeholders have the necessary information to manage the signed agreement and that all important details such as roles and responsibilities, obligations, and contract milestones are addressed
- Contract phase – This is one of the most important phases in the contract management process, where those responsible for managing the contract track key milestones and commitments, monitor performance, and ensure the contract is delivering the intended results
- Pre-contract renewal phase – This phase evaluates the overall performance of the contract and decides whether to terminate, renegotiate or renew the contract
- Post-Contract Phase – Now that the contract has expired, the post-contract phase is the time to ensure that all terms and conditions have been met and to resolve any final ambiguities before conducting a contract follow-up to help you improve in the future.
CLM is thus not only a system that helps the legal department and lawyers in the company to draw up contracts more quickly and securely. Setting up cross-departmental and Group-wide contract management is a great opportunity to support all divisions, departments, subsidiaries and other organisational units in their contractual work, but it also enables active risk management, the implementation of corporate governance and compliance rules, reveals potential for marketing and sales, and ensures the greatest possible transparency.
Benefits of CLM software
There are a number of contract lifecycle management softwares on the market. They help you automate and simplify the contract lifecycle, while ensuring that you comply with corporate policies. In any case, you should make sure that the software you choose meets the following points:
Save time and standardise contract creation
Contract lifecycle management software automates and standardises tasks such as contract creation, approvals, signature collection, contract renewals, and reporting. This frees up time for you and your team to focus on the things that make a difference.
Easily track and manage contract terms, redact edits, and maintain a single source of information between multiple parties. This gives you a clear view of your company’s obligations and simplifies the negotiation process.
Streamline contract approvals
By automating tasks such as routing and notification, you can be confident that contracts are approved in a timely and efficient manner.
Improve security and compliance
By providing a central document repository for all contracts in your organisation, contract lifecycle management software helps you improve security and compliance. This helps you keep track of important deadlines, renewals, and amendments.
Reduce administrative costs
By automating repetitive tasks and improving efficiency, software can help reduce the overall costs associated with contract administration.
Mitigate risk and reduce contract non-compliance.
Good software helps you ensure that all items are on the credit side. It can also help you ensure that only the people who need to access the contract have access to it.
Keep an overview and search for and find important contracts
Finding the right contract among thousands can take a lot of time. Good software is like a magnet for your contracts – you don’t have to spend time searching through endless pages of documents, but let the documents come to you.
Better and automated reporting
Standardised report templates are difficult to configure for your specific needs. Smart contract management software can analyse reporting metrics to give you the most relevant information when you need it.
Contract management solutions such as proCONTRACTS take over the process of contract creation, template management, reconciliation and archiving as well as the automatic evaluations of conditions, prices and risks. All this is available to employees and departments at the push of a button. They thus provide a complete overview of all contracts and conditions, ensure faster processes through automated workflows and standardised modules, and enable deadlines and obligations to be met reliably. This applies to individual contractual obligations as well as obligations arising from data protection laws such as retention and deletion periods. So today, an intelligent and secure software solution for managing contracts is not only a real booster in terms of corporate processes, it is in fact a fundamental success factor for exploiting all the potential that contracts offer.
Success factor: Seamless integration into existing systems
When introducing a software solution for digital contract management, the seamless integration of or into other systems is crucial. The proCONTRACTS solution scores here with its integration into Microsoft Dynamics 365. This means that all data and analyses, for example from marketing, sales or service, are available, and customer data, analyses or forecasts can flow into and be linked with contract evaluation and design. And vice versa, of course. Customers, partners and suppliers can be viewed comprehensively with a 360-degree view.
The resulting opportunities for cross-departmental collaboration lead to significant increases in sales, greater customer loyalty and higher success rates. Based on the data, better forecasts and more reliable predictions can be made, and offers, whether service, product or contract, can be tailored more individually to customers, partners and suppliers. This increases customer satisfaction and customer loyalty. The bottom line: A contract management solution like proCONTRACTS is not only a real added value for the contract departments in the companies due to the easy integration into the Microsoft Dynamics world, it is an important building block for everyone in the company to tap new potentials, minimise risks and accelerate business processes.