Last updated on February 3rd, 2020 at 05:15 am
Many companies, even those who have digitized certain aspects of business, still use paper. They manage their contracts by using filing cabinets full of hard copies of drafts, final copies, and signed contracts (which are sometimes left unlocked). In other cases, companies have folders and files on their computers or individual hard drives to store contracts, often unorganized. This can make it just as difficult to call upon information throughout the contract life cycle. Even worse, users find themselves wasting valuable time as they send and receive emails with attachments to review contracts, seek approval, and maintaining complicated spreadsheets for tracking contracts throughout their life cycle. That’s where contract management software comes in.
So, what is contract management software exactly?
Contract management software from ContraxAware is a specialized technology that allows companies to electronically manage employee, partner, vendor, and client contracts. Ultimately, contract management software provides the tools for businesses to manage any process which creates, uses, or references contract data. So you can recycle those obsolete filing cabinets and let your IT department organize your digital files in a more efficient and centralized way! Reduce your security liabilities and improve your work processes with an automated tool that works just as hard as your team.
If you aren’t convinced that investing in contract management software is the right choice, this guide offers an in-depth look at some of the specific processes and features provided by contract management software. You can also see the benefits every department in your organization can enjoy when you bring your contract management processes into the future.
Features of Contract Management Software
ContraxAware’s contract management system specializes in creating custom workflows and organizational tools that help your company through every stage of the contract management cycle. Every department benefits from having tiered access to these features:
Customizable Contract Database
Contract management software is centered around a repository of all contract data, including a database of all current and former contracts. This data is available day and night and allows users to search, filter, share, and sort the data they need in the way which works best for their particular task. This is especially important for facility managers who might need to access a vendor contract on the fly to deal with service delivery issues.
Contract management teams who need to make a request can pull exactly what information they need from the database. The dynamic information fields allow contract authoring teams to generate contracts that auto-populate with customer names, products from the opportunity, and the specific terms and conditions that will govern the deal. Also, they can quickly review contract types and determine the best option. Other features for managing contracts include the ability to search text, track different contract versions, and compare documents.
Companies can build a contract database with customer contracts, partnership deals, vendor contracts, and corporate organizational documents.
Task & Alert Tracking
This feature set allows contract management software users to see their workload and assigned tasks for each contract and generally keep track of the entire contract life cycle. Those in supervisory positions have more access to contract tracking software administrator controls and functions. This allows them to assign and monitor tasks they assign to their team.
Users can create alerts to remind themselves or others of important deadlines like contract expirations and contract renewals. Also, users can create automated reminders and notifications which go out to appropriate parties. This is especially useful for supervisors and managers who need to be out of the office for business or personal reasons. Every automation you can make to contract tracking and task assignment strengthens your business.
It’s likely your legal department drafts your contracts or at least plays a large role in reviewing drafts. Contract management software has a number of features that can aid in the quick and accurate creation of documents. For example, the legal department can create templates for each type of standard contract you need, so users can fill in a few necessary data fields and have the draft ready to go. This means your legal team doesn’t have to touch every single contract anymore.
You can also set up your contract templates so, when you select a contact, the customer’s information merges with a contract to create a draft. Now, users don’t need to enter data manually. Contract authoring features in contract management software can also promote self-service in your organization. When users need a contract, they can make a request which goes to the right department for processing and approval.
Contract Workflow Management
Many other features of contract management software allow users to manage contract workflow. For example, you can create workflow templates for each stage of the contract management process, including negotiations, approvals, and signatures. Once the automated workflows are set up, administrators can assign them to the appropriate department, groups, or individuals. Once a user creates a template, starting a workflow can occur in under a minute. The system will automatically notify each user as they need to take action. This helps standardize your company-wide processes.
Contract workflow management features also allow users to track the progress of a contract through each stage and handle any issues as they occur. For example, if a contract has been sitting in your finance department waiting for approval, the person who created the workflow would get a notice if the financing was denied. Contract workflow management features also help ensure all workflow tasks are completed on time.
Once users have been assigned tasks in a workflow, they can receive reminders about overdue tasks on the program’s dashboard and/or via email. This cuts down on costly delays and frustrated emails.
The ability to create user roles within contract management software is one of its most powerful features. Those in management and supervisory roles can add individual users or upload a group of users, so they can access the system. User roles work well to limit access to contracts, contract templates, and other contract data. Not every department — or employee within a department — needs access to the same degree of information and editing power. Implementing strong Role-Based Access Control (RBAC) policies protects your business.
For example, the marketing department might need access to contract templates to know how to market to specific groups, but they don’t always need access to the editable contract. Sales managers and sales directors each need approval roles, but their approval powers should be different. ContraxAware can make that happen.
Not only do user roles help manage workflow, but they also keep sensitive data secure and reduce the risk of a data breach. Permissions can include a variety of things such as viewing, adding, editing, or deleting contracts. Together with contract workflow management, you can also track and oversee user activity and create alerts when specific user-related changes are made.
10 Business-Wide Benefits of Contract Management Software
Making changes to the way you’ve always done things can be scary. If your company did the cost-benefit analysis on making the switch years ago, it’s important to take a second look at the new features modern CLM software has to offer. Today’s contract management software provides ample benefits for your organization, which makes learning how to navigate the software worth the time and effort. Every department that touches company contracts or customer data can enjoy more productivity and fewer manual, repetitive tasks. Some of the benefits include:
1. Decreased Contract Life Cycle Times
Contract management that isn’t automated takes longer than using software. Costly bottlenecks often occur when contracts get stuck in different departments waiting for action. Contract management software allows for centralization of all your contract-related data, providing easy access to relevant parties in each stage of the contract management process. This centralization leads to quicker responses when negotiating and faster approvals. Ultimately, contract management software helps decrease the average time of your contract life cycle.
2. Increased Contract Flexibility
It’s likely you have a few standard contracts you use to facilitate business with vendors and customers. Sometimes, special situations call for adjustments to these standard contracts. Contract management software gives you the flexibility to make changes quickly to meet the needs of your customers. This might be the difference between losing or closing a deal. This increased flexibility also saves time. You don’t have to wait for someone to re-draft a new contract because the capability to make changes (and get those changes approved quickly) is at your fingertips.
3. Data Integrity
Storing executed contracts and old contracts in filing cabinets or on a person’s computer doesn’t maintain the integrity of the data in the long run. You can lose your hard copies in a fire or from water damage. Similarly, as paper gets older, the ink fades and important information becomes difficult to read. Storing files on a PC or laptop also can lead to data integrity problems when files become corrupted, or when they disappear as you update computer software. Our contract management software is cloud-based, which protects you from deterioration and loss.
4. Data Security
You probably already know hard copies and file cabinets aren’t secure. Those who want to access contract-related files can easily do so, even if it means breaking and entering. In regards to computer files, technology has been both a blessing and a curse. Plenty of nefarious types know that contracts can contain sensitive information from personal contact information to intellectual property. Insecure systems, and sometimes those which are thought to be secure, can easily fall victim to viruses and cyber-attacks, compromising all of your contract data. Contract management software is more secure than other contract management practices. Keeping your data in a proprietary, cloud-based contract management system lets you protect your company’s and your customers’ valuable information.
5. More Control of Data
Closely linked to increased contract flexibility, contract management software also gives more control of the data. This especially benefits procurement departments who request proposals and issues contracts. They can decide what data is included in requests and who has access to that data. Additionally, they can change their preferences based on contract type. Ultimately, more control of data makes it easier to manage the workflow processes for each contract.
6. More Time to Focus on Customer Service
When businesses use traditional, more time-consuming contract management methods, their customers ultimately lose out. Customers and clients discern between companies offering the same goods or services by their customer service. It’s often the sales team on the front lines generating new business and closing sales. Contract management software gives all of those involved in the sales process and contract life cycle more time. This allows those who deal directly with clients or customers to get for face-to-face time.
7. More Closed Deals
Closing more deals is another benefit of contract management software. When contracts aren’t held up in bottlenecks, the same number of employees can work on more deals. Good CLM software means:
- Your company will have ease of access to contract data.
- You can centralize entire contract management process for easy, secure access.
- Business dealings go more smoothly, and there is a reduced risk of dropped deals.
Plus, more face-to-face time with customers can reinforce a business relationship and lead to more closed deals. When your salespeople aren’t trying to get manual approvals, they can interact with customers more.
8. Increased Compliance Across Departments
Workflow management across departments can be one of the most frustrating aspects of contract management. You might have some type of best practices associated with your contract life cycle. But monitoring compliance can be difficult, if not impossible. Enterprise contract management software and a good contract compliance manager are essential.
A good contract life cycle works like a machine in which each department plays a valuable part during one or more stages. Contract management software allows those responsible for every workflow to ensure each department and person is doing their part and complying with company best practices. It also creates a universal interface where every team member can find the information and updates they need.
9. Reduction in Administration Costs
Contracts come with many administration costs, especially when managed by traditional methods. Procuring a contract, negotiations, and making changes or amendments require hours of manpower. Once a contract starts, you must send or pay invoices. Also, your company must monitor the contract to ensure each party is meeting its obligations. Contract management software streamlines contract management processes. It reduces the time each person needs to spend on their part of the life cycle. In turn, this saves your company money on administration costs.
10. Increased Contract Renewals
As previously mentioned, contract management software allows more time to focus on customer service. There’s more time for meaningful face-to-face or virtual interactions with customers. This helps build customer and brand loyalty, so sales teams don’t need to work as hard for contract renewals. Additionally, software allows relevant parties to monitor the start and end dates of a contract. Sometimes a customer continues to get a product or service, but the company isn’t getting paid. In other cases, a customer continues to pay, but their product delivery or service ends. Contract management software prevents these mishaps. This can ultimately reduce the potential loss of long-term or returning customers.
Automating your contract management process with contract management software provides several benefits to your organization. With so many attractive features, each department in your company can perform their work better. Not only will this shorten your life cycle, but save you money and time all around. In fact, using contract management software can reduce contract time by months in some cases. Contact us today to learn more about how contract management software can help your organization, or sign up for a free trial today.