It is already a given that a business cannot survive without a Contract Lifecycle Management integrated into their business operations. It is one of the vital and key differences between a successful business and one that is in a higher risk of failing. Contract Management is the business process of taking full control of your contracts. As contracts are legal agreements between various parties which is important as it acts as protection, especially during altercations.
This also ensures that all agreed-upon terms are met and followed which, in a lot of events, is very helpful especially in the case of a multi-operational business whose performance is reliant on all of the departments working positively perfectly.
One common mistake that businessmen make is that they undermine the power of contract management and thus allot very little resources to it. Studies state that companies lose up to 9% of their annual revenue thanks to the mismanagement of contracts. Here are some benefits of having a Contract Lifecycle Management system in your company.
Faster Contract Signing Process
The manual process of contract signing is tedious, uses up too many resources, and takes months. Having hardcopy contracts physically signed necessitates many processes such as countless physical meetings, negotiations, drafting, printing, etc. For every term that is changed, it would require another set of physical meetings, drafting, and printing. Aside from being outdated, it also wastes a lot of valuable resources such as time, money, and paper. A Contract Lifecycle Management software automates everything which means everything can be done remotely. This is also a more convenient way for companies with international vendors and clients.
Once the contract has reached its final draft, there is only one more step before it becomes a legally binding document. That is to affix the signatures of all the concerned parties. This takes up so much time from all parties when it could be done in less than a minute with an electronic signature.
Reduce Financial Risk
While it is a given that companies have to take a lot of risks to be successful, managers and business owners still have to learn how to mitigate the risks that they take. It would be foolish to always blindly jump on something. Risk reduction is an important process of decision making. A Contract Lifecycle Management Software will allow you to see which risks are worth taking and which are not.
Full Visual Of Contracts
Many do not realize just how important having a full visual of all your contract data can be. A company will have hundreds of contracts to handle. This becomes extremely hard to manage especially when you only have a limited amount of manpower on board.
A Contract Lifecycle Management Software will allow you to track the performance of all your vendors and clients. For many business owners and managers, this data is used for further decision-making processes. It is also used to track whether a party is delivering or not. Depending on the situation, this can act as proof during an altercation that someone was not able to follow through with their KPIs.
Keep Track of Important Deadlines
Unless you have a staff that has an eidetic memory, it would be nearly impossible to keep track of all contract data. We are all guilty of forgetting important dates. Just think how hard it would be for your staff to remember dozens of crucial dates like contract renewals and deadlines.
There are a lot of missed opportunities that come with an error that could’ve been easily prevented by integrating a Contract Lifecycle Management Software. As this is a computer we are talking about, it is guaranteed that a human quality such as forgetfulness will not apply here.