Managing contracts has a large impact on an organization’s overall success, especially when it comes to costs.
As nearly every business process becomes digitized, more and more organizations are turning to their last manual process, contract management, as a solution to mitigate risk and increase revenue. While there are numerous benefits from going digital in regards to contracts, two of the greatest advantages are saving money and decreasing risk.
We’ll be looking at both cost and risk in a two-part series. Later this week, we’ll look at the risks associated with manual processes; but first, below are some points on how manual processes drain company resources and how a cloud-based contract lifecycle management platform can solve the issues.
Without a platform in place that provides insight into deadlines, renewals, and all the information necessary to properly manage contracts, it’s difficult to track every date and stay on top of timelines. Being unable to manage these things means a company is able to take on less contracts, ultimately leading to less revenue and limiting the potential for future growth. If the contracts that an organization already has aren’t able to be managed well, adding more contracts only complicates things.
Inability to expand is not a promising trajectory for a business. Instead, finding a solution that allows contract managers to have a full picture of every document, including deadline alerts and powerful search, eliminates the chaos and helps contracts be well organized.
Failure to Enforce
When there’s no clear insights into contracts, enforcing terms is not as simple. Terms that go unfulfilled reduce the benefits of an agreement and make it more expensive in the end if the goods are not delivered as promised. The ability to monitor compliance well decreases the chances that another party won’t comply, ensuring the agreement is carried out by both sides.
A contract lifecycle management platform should have a comprehensive audit trail that clearly outlines how and when the agreement was made. Pre-approved templates can also assist in this circumstance as the legal team is able to define terms.
From an individual standpoint, it’s not only frustrating to have to search through filing cabinets or emails for documents, but it wastes company time and talent. With this tedious work eliminated, employees are freed up to focus on more strategic work that directly impacts a company’s growth, revenue, and scalability.
A contract management platform consolidates all people, processes, and documents into one place, taking away the need to spend valuable time tracking down these things. With templates, approval workflows, and access control for everyone that needs it, a platform should drastically cut down the time spent managing contracts and be able to focus that time on more productive tasks, such as procurement, enforcement, fulfilling, and many other things.
At this point in the business world, with almost every process automated and streamlined, contracts are a huge money drain for a company if they are still being managed manually. Switching to a contract management platform should produce near-immediate results as workflows become more efficient and money is no longer lost to manual processes.