Contract Management Software Can Deliver Game-Changing Insights About Your Business.
No matter the size of your business or organization, you likely have a significant number of contracts that you must constantly monitor. Whether the contracts are with customers, suppliers, or someone else, you and your team must ensure that you (and your counter-party) are complying with all contractual terms and deadlines.
It can be overwhelming. One slip up can result in significant financial or legal consequences.
On our blog, we have previously discussed the top ten benefits of using a contract management software system compared to a paper-based system. Some of those benefits include increased security, the availability of contract templates to more quickly generate new business, and the ability to better manage relationships both inside and outside your organization.
That said, there is one unique benefit that can deliver value—regardless of the type or size of an organization. That benefit can be summarized as follows:
A contract management software system can deliver advanced analytics and insights which can ultimately reduce expenses at your organization.
Compared to a paper-based system, contract management software can help you learn much about your past and current contracts. It can help you learn more about your suppliers and how often they comply with your contractual terms. And it can ultimately help you reduce expenses and increase your bottom line.
So how can contract management software actually help you do this?
First, contract management software allows your employees to access a robust amount of data—wherever they are.
A simple way to understand the contract management software is that it is simply a database that contains fields and records. These fields and records that all of the key elements of a particular contract. In effect, contractual terms are transformed into data which is gathered, parsed, and analyzed.
Simply put, this is huge news for any organization. Employees in all divisions of your organization—such as procurement, sales, and legal—can more easily track and monitor every discrete detail of a contract. They can do this by creating and leveraging customizable analytics in a contract management software system.
For instance, let’s say that one of the key performance indicators (KPIs) of your organization is to minimize the time from initiation to signature. Essentially, you wish to measure how long it is taking for contracts to be drafted and executed. With a paper-based system, you would need to pull up the contracts for each and every contract, along with any accompanying emails or correspondence, to determine when a particular contract was initiated and when it was signed.
By contrast, with a contract management software system, the process is seamless. You can not only quickly look up the time from initiation to signature for each and every contract, but you can compare the time from initiation to signature for one contract to any other contract in the system. Doing this allows you to better understand which (if any) counterparties are slower to sign certain contracts and how you can think about changing those contracts to speed up the process.
A contract management system like ContraxAware has other critical features. It can deliver automated reports on these KPIs so that you and your team can ensure that you are on track. It allows users to complete global text searches to search within the text of all contracts in the system. The software can also create detailed reports and graphs to display the data in a different way. And as with everything, users can create graphs by generating custom reports, which focus on the data that they want to capture.
Ultimately, Big Data and automation is a key feature of contract management software. It is essentially you and your team’s backup, reminding you of key deadlines and goals that you are striving to achieve.
So along with the benefit of ensuring that you and your team are following your self-selected KPIs, contract management software can ultimately reduce expenses for your organization. It does this by using the power of Big Data to unearth insights in your contracts that, in all likelihood, that you wouldn’t discover without the software.
As explained in the example above, contract management software can help you understand (and minimize) the time from initiation to execution for your contracts. Along with this, the software can help you understand where contract bottlenecks are occurring, whether there are contract amendments that are continually appearing, and whether your organization or counterparties are complying with contract management policies.
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The possibilities are endless.
Once you gather and analyze these insights, you and your organization can evaluate your ongoing and future contracts. For instance, your organization can eliminate common contractual terms or even rethink relationships with recurring clients who haven’t adhered to all of their responsibilities. Your decisions will be supported by cold, hard data that isn’t subject to emotions or bias.
Critically, data will give you the upper hand in future negotiations with a current contractual partner or a new contractual partner. If a reliable supplier has recently been failing to adhere to certain contractual terms, for instance, you can gather the data showing the supplier’s tardiness and use it to negotiate either more favorable terms or a reduced price in subsequent contracts.
Data within your contract management software can ultimately allow you to better understand your past and current contracts while allowing you to iterate as appropriate in your future contracts. Doing this will not only save you future headaches, but will reduce expenses and improve your organization’s bottom line.
Discover Advanced Insights Today
Advanced data and analytics can help you and your organization better understand your current contracts and reduce risk—both now and in the future. These benefits will flow to your organization’s bottom line, allowing your business to grow more quickly.
Luckily, the switch to a contract management software system is easier than you might think. At ContraxAware, we have a team of experts that can migrate any existing contract data or documents to our platform. We also have a team of rockstar customer support specialists that can solve any technical questions that you may have.
As always, if you are interested in learning how contract management software can help you and your organization, don’t hesitate to contact us! You can visit our website here or call us at 603-897-9999. We look forward to hearing from you.