Losing track of contracts in the middle of your process can cause serious problems for your business. You run the risk of missing out on potential new customers (or having old ones slip away). It’s bad for future business, too. If your business develops a reputation for losing contracts, you may quickly discover that new customers don’t want to work with you. Most clients have their own contract approval processes and understand that it may take time to sign and implement a new contract. But that doesn’t mean you want to drag it out and risk losing those contracts. First, make sure your contract management process includes these nine phases for comprehensive, organized contract management. Then incorporate these three strategies into your process. With these steps, you can ensure that in-progress contracts don’t get lost. Even better, you can move them through the approval process more efficiently.
1. Keep all of your contracts in a single repository.
Do your contracts often go on a tour through the office? Physical documents may have to travel to multiple different desks. Emails may get lost in multiple different files and folders within your company’s organization system.
Like never knowing who’s in charge of the contract, this method can quickly lead to lost contracts. It’s easy for a contract to fall through your organization system and disappear from public attention. Once no one’s watching, it can languish without being moved on through the process.
To keep your contract approval process moving smoothly, keep all of your contracts in a single repository. Use a filing system that makes sense for your office, but ensure that contracts can all be accessed from a single location and viewed at a glance. If you need to send copies of the contract elsewhere, ensure that the primary file is updated. That ensures everyone can keep up with the contract’s progress and any changes made to it. Read more about how centralizing your contracts on the cloud can solve traditional problems of both centralization and decentralization.
2. Assign someone to each contract every step of the way.
Your contract may need to go through multiple different hands — whether physically or virtually — on its way to approval. In some companies (especially bigger companies), this may include simply sending the contract to a pool of professionals to get it approved.
This method, however, is a surefire way to see your contract lost.
This individual thinks the person across the room is responsible for the contract. That employee assumes that “someone else” will take care of it. Another employee assumes that the contract has been sitting there too long for it to be important. When it drops out of the queue, everyone assumes that someone else took care of it — if they even notice it at all.
If you’re struggling with lost contracts, take the time to assign a specific individual to each contract as it moves through your approval process. Assignment options are a must-have feature for any contract management system. Those individuals can shift or share responsibility as needed, but assigning a specific individual to the contract ensures that it gets the attention it deserves. If for some reason, a contract does fall through the cracks, you have a better shot at identifying where the problem occurred. Ideally, you want these individuals to overlap in their oversight so that the contract is never left languishing and someone always knows where it is in the approval process. Also, appoint appropriate signatories (and backup signatories) for different types of contracts. This will prevent bottlenecks and gaps due to turnover.
3. Make regular searches part of your contract management process.
You can do your best to keep all of your contracts in a single place and follow them through the process. But every so often, something will still slip through your fingers. Not keeping an eye on contracts that aren’t strictly on your to-do list can be a costly mistake, especially for small businesses. To spot it as quickly as possible, choose contract management software that will make searching through your contracts a snap. Then, add “search for incomplete contracts” to your weekly or monthly To-Do list, depending on your usual contract approval cycle.
Chances are that when you conduct this search, you will flag all of the in-progress contracts throughout the business. But you’ll also get a chance to look through any contracts that have been forgotten, especially if you sort by creation date. This is the ideal time to:
- Remove any contracts you (or your client) decided not to move forward with.
- Clean out copies of contracts.
- Ensure that contracts that have languished too long are quickly dealt with.
You may choose to expedite contracts that have sat for too long, so they’re dealt with more quickly. You may also want to speak with the person last responsible for the contract: What’s the holdup? What prevented this contract from being moved on through the approval process? Then, you can more effectively determine what to do next.
Managing your contract approval process is an ongoing effort for your business. You may discover that you need to make regular changes to help keep it moving effectively. One of the most important things you can do for your business, however, ensures that contracts do not get lost or forgotten. These three steps can help prevent your important contracts from falling through the cracks.