6 tips for improving your contracts management process
Last Updated Thursday, June 15, 2017
Most companies have a need to centralize and automate their messy, paper-based processes, and this is especially true when trying to manage the signed contract throughout its lifecycle. Contracts can be slow to process and consist of a combination of a Master Agreement, Product Schedules, Non Disclosure Agreements (NDA) and Service Agreements, making it difficult to act on the critical dates or easily view important compliance information hidden in the contract text. Typical problems include:
- Financial losses: Some service agreements have auto renewal clauses, so not having the ability to act on expiration dates could mean paying for services that are no longer required. The opposite is also true and critical equipment that needs service coverage may no longer be covered if the contracts are not renewed.
- Inability to access compliance information: Most contracts have numerous stakeholders that need access to key information often hidden in lengthy legal text. Such information can include licensing compliance limits, price escalation or penalty clauses.
- Lost documentation: The typical organization loses 5% to 10% of all contract documents.
Lack of visibility: Without an organized system, it may be difficult to obtain a 360-degree view of large suppliers. Not having this view of active contracts can lead to duplications, resulting in lost productivity. For example, it is often easier to sign a new NDA than try to establish if the previously signed one is still applicable.
- No search capabilities: It can become difficult or even impossible to search on historical contracts.
These are huge hurdles to overcome with a manual process. This is why it’s so important to incorporate an automated, centralized system that brings everything together in one place. Benefits of using a contracts management process:
- Standardized and validated data entry: when everything follows the same, uniform process, it’s much easier to complete the contract in a timely fashion.
- Automation of routing and approval process: speed and ease come into play here – no more paper contracts gathering dust on a supervisor’s desk. Each step is clearly laid out and managed via workflow.
- Store all related documents in a centralized location: avoid multiple copies and contradicting versions of important documents by removing the manual filing system.
- Centralized storage also means higher levels of security and optimum compliance.
- Centralized access to information and documents to provide a 360° view: greater visibility into the contracts management process means you’ll know exactly who or what is slowing things down, making it easier to eliminate bottlenecks. Dynamic reports and dashboards also help make the reporting process easier than ever.
- Quicker authorizations/approvals: Get the right documents to the right stakeholders at the right time, cutting out middlemen and getting business done faster and more efficiently.
No-code business apps are a quick and efficient way to automate business operations, so you have more time to focus on providing the best possible client services and improving profit margins. Find out how K2’s no-code business apps can improve your contracts management process by attending our live webinar on March 11, 2015 at 10am PST.