A healthy contract management process should constantly be adapting to technological advancements. As contract volume and contract complexity begin to grow, organisations must embrace digital transformation to be furnished with the right tools to streamline the contract management process. Such innovative CLM tools can be found within a trusted contract management software system. Read on to learn more.
What is the contract process?
The contract process involves overseeing contract lifecycle management (CLM) contract deliverables, contract terms, deadlines and contract conditions while ensuring contract security and contractual and regulatory compliance. The contract process does not end at contract execution. Effective pre- and post-award contract processes are crucial for increased revenue, decreased risk and a positive organisational reputation.
Contract process steps
There are eight critical stages of the contract process that should be handled as efficiently and effectively as possible: contract:
- Requests
- Authoring
- Negotiation
- Approval
- Signatures
- Obligations
- Compliance
- Renewal
During any of the abovementioned stages, contract lifecycle bottlenecks can be disastrous – likely compromising the entire contract lifecycle.
Five tools to improve your contract process
Luckily, organisations need not worry about a decentralised and disorganised contract process thanks to leading contract management software. More specifically, below are five contract management software tools to leverage to improve the contract management software process.
CLM: Contract Lifecycle Management
Organisations of all sizes face the need to juggle multiple digital contracts simultaneously, with each contract being at a different stage of the contract process. Leading contract management platforms saves time, reduces risks, improves productivity, and maximises a contract’s value during the contract lifecycle.
The contract lifecycle is the contract process under which a contract is drafted, reviewed, signed, and executed. The ‘lifecycle’ model is used to visualise a contract’s journey. It begins with requests and ends when requests are entirely fulfilled – with the potential for renewal. The eight common steps are Requests, Authoring, Negotiations, Approvals, Signatures, Obligations, Compliance and Renewals.
Full contract lifecycle management software allows organisations to oversee the full contract process, including requests through renewals and everything in between. CLM software improves the contract process with:
- automated contract requests
- contract creation with the seamless merging of contracts with templates from an organisation’s pre-approved library
- centralised contract negotiation processes, collaboration, and contract review processes
- detailed contract analytics and data tracking
- automated key date notifications for greater accountability
- robust risk management tools
- automated task management for improved obligations oversight
- AI-based compliance management and risk mapping
- comprehensive process configuration and tracking for specific contract types for various industries
- integrated RFx management (including RFPs)
- Extensive yet straightforward searching and reporting – which can include an ad hoc and custom report designer.
Contract repository
A contract repository is a centralised digital storage system used to manage and store contracts and related documents throughout their lifecycle. It’s an essential tool in the contract process for several reasons.
Firstly, it provides a single, organised location for storing all contracts, making it easier to locate and retrieve specific documents when needed. Additionally, it allows authorised personnel to access contracts from virtually any location, ensuring that stakeholders can review and manage contracts as required. Security is a significant feature as it ensures that sensitive information is protected through access controls. The repository can track different numbered versions of contracts with audit trails, basically ensuring that the latest version is always available and previous versions can be accessed for reference.
A secure contract repository can also help ensure contracts comply with relevant laws and regulations by maintaining detailed records and audit trails for any audits or compliance checks from external bodies. By automating contract archival and retrieval processes, a contract repository significantly reduces the time and effort required during the contract process.
Contract AI
Contract AI is used to analyse contracts and transform static documents into proactive building blocks for improved contract oversight, proactive opportunity identification, and risk mitigation. Automate data extraction and sensitive data identification, intelligently map risk, statistically analyse data, configure data thresholds to trigger intelligent automated workflows, and leverage instant recommendations based on real-time data.
Auto-redlining with contract artificial intelligence can automate the inclusion of clauses from users’ approved clause library, virtually ensuring that favourable clause language is included. Users can auto-redline documents ad hoc or configure them to auto-redline upon upload. They can quickly see and manage automated redlines and comments with comprehensive audit trails. Advanced contract process solutions are compatible with MS Word and CobbleStone’s native online document editor for diversified auto-redlining.
Advanced contract process AI can provide proactive CLM field recommendations for metadata fields for contract clauses to streamline contract management software implementations. This functionality can allow teams to enjoy proactive, AI-based contract metadata field recommendations for extracted, common contract clause types. They can also enjoy visibility and governance of these recommendations at a glance and decide which contract clause metadata fields to capture.
Finally, contract process intelligence can be leveraged for generative AI processes. Contract teams can search from a database of thousands of real-life clauses, generate new clauses from real machine-learning data, or leverage a user-friendly chatbot.
Compliance management
Contract process software helps compliance in several ways. As was previously mentioned, it provides a centralised platform where all contracts and related documents are stored, virtually ensuring that they are easily accessible and consistently managed. This centralisation allows for better oversight and control over contractual obligations and terms. The software includes automated alerts and reminders for key dates, such as renewal or termination deadlines, which help ensure that actions are taken promptly and according to the contract terms. It also enforces standardisation by allowing organisations to use predefined templates and clauses that comply with legal and regulatory requirements. This reduces the risk of non-compliant language or specific terms being used.
Contract process software maintains detailed records and audit trails of actions taken on a contract, providing a transparent history that can be reviewed for compliance purposes or during audits. By offering reporting and analytics tools, contract process software enables organisations to monitor compliance metrics and identify potential issues before they become significant problems.
Electronic signature capability
Best-in-class contract process software integrates with leading e-signature solutions, including Adobe Sign, DocuSign, signNow, and more. Additionally, advanced contract process software providers have native electronic signature platforms that provide a fast and easy way to sign and execute contracts.
Those involved in the document signing process can automate and supercharge document management, electronic signatures, and digital signatures with a digital certificate of authenticity and Uniform Electronic Transactions Act (UETA) compliance using public key infrastructure (PKI). They can enjoy additional security and compliance and a legally binding process.
Contract process software integrated with eSignatures keeps the signature process moving with bulk e-signatures and helps keep customers, employees, and partners happy. Users can easily manage signatures for non-disclosure agreements (NDAs), master service agreements (MSAs), consulting agreements, confidentiality agreements, sales contracts, and others. Electronic signatures are legally binding according to the Electronic Signatures in Global and National Commerce Act (E-Sign Act).
Electronic signature capability is best implemented with an electronic signature tool within contract management software to streamline signing processes. Leading electronic signature functionality offers:
- saved, typed, or drawn eSignatures
- date placeholders
- eSignatures with initials
- additional text for eSignatures
- use of previously saved titles
- easy one-off eSignatures
- bulk eSignatures
- rules-based eSigning
- a secure portal for online signing collaboration
- digital signature options.
Improve your contract process today.
Contract Insight is an award-winning, widely-trusted contract lifecycle management software solution, which has helped thousands of organisations from a vast array of industries within both the public and private sectors to optimise the contract process, boost revenue, promote productivity, centralise CLM processes, and reap the most value from contracts.
To learn how to more easily draft contracts, get contracts reviewed, collaborate on negotiations, and much more to improve contract management processes, book a free demo of Contract Insight® contract management and eProcurement software today!
Contact John O’Brien, CEO at Four Business Solutions – global business consultants and software integrators specialising in business process improvement.
