In the old days, contract management involved storing hard copies of contracts in a filing cabinet, or series of filing cabinets, somewhere on your company’s premises. The contract manager manually kept track of important agreements, the key dates involved and the basic terms of those agreements, usually using a spreadsheet, a list or some other manually compiled document.
If you’re still doing it this way, it’s time to change. Old-fashioned contract management techniques come with a lot of problems, not least of which is the difficulty of staying on top of contract renewals, intellectual property (IP) rights, fees and more. With most businesses handling numerous contracts, contract management is often too complex for a single human being to tackle unaided.
But contract management software can help. Contract management systems can save you time and money, reduce contract-related headaches, smooth the audit process, reduce the risks related to improper management of contracts and make your business more stable overall. Here’s how contract management software can help you run a better business.
Cut Costs
When two businesses enter into a contract, it is to be hoped that each will enjoy maximum benefit from it. However, when contracts are poorly phrased or poorly managed, costs can skyrocket quickly. You could find yourself losing thousands, or more, due to issues in a contract that you were unable to identify.
Of course, that’s not the only issue with poorly managed contracts. Contracts typically expire every so often and must be renewed; when it’s time for renewal, you may want to renegotiate for better terms or end the relationship altogether. However, without sound contract management, you could find that contracts renew themselves automatically, regardless of whether you were hoping to renegotiate the deal or end the contract. Key provisions like these have to be monitored so you know when a contract renewal period is coming up, you can protect your IP rights, or you can take a contract that isn’t working as well as you’d hoped back to the drawing board.
Contract management software is the best tool for this. A survey by SpringCM found that 92 percent of contract management problems at companies ranging in size from fewer than 100 employees to more than 8,000 could be chalked up to human mistakes. The more you can automate your contract management process, the better.
Keep Track of Contracts
Contracts must be stored somewhere, and with business being done increasingly in the cloud, it doesn’t make sense to keep storing them in moldering file cabinets. When you store copies of your contracts in the online repository offered by most high-quality contract management suites, you’ll never have to worry about losing them, misplacing them or spending hours digging through a filing cabinet looking for them. You won’t have to worry about someone taking the contract out of the filing cabinet and not replacing it, nor will you have to worry about a contract manager implementing a convoluted, highly-personal system of contract management that only makes sense to him or her – and then leaving the company without sharing the intricacies of his or her complex filing system with anyone else.
Search Contracts Easily
Isn’t it so much easier to look something up on the internet than it is to pull a dusty encyclopedia off the shelf and start flipping through the pages? Why wouldn’t you want that kind of convenience from your contract management system? Contract management software makes it easy to search through your company’s agreements to find important information like key terms, dates and other data. You can even ask the system to alert your contract managers of upcoming events and important dates, such as contract renewals or deadlines for promised deliverables.
Your contract managers will also be able to search every contract in your database to find groups of documents that meet specific criteria, such as similar terms and conditions or similar types of relationships. You can use data from your contracts in any way to get an efficient overview of the state of your company’s agreements.
Contract management doesn’t have to be a time-consuming hassle. With contract management software, it’s easy to keep track of your company’s agreements, save money and foster beneficial business relationships that will see your organization continue to grow and thrive long into the future.
