What Is Contract Management Software?

Contracts are essential for any business. They span a wide range of documents like forms, agreements, notices, etc., concerning customers and employees and are crucial for the business to keep track of all its daily transactions. 

Since the average business produces several thousands of contracts every month, streamlining contract-related processes using software is a no-brainer for businesses. Contract management is now becoming indispensable for businesses for a variety of reasons.

Primarily, contract management software is a versatile tool that helps business teams carry out all their contractual obligations and functions across different areas of document management. Contract automation software is also highly beneficial for businesses across industry sectors as it injects ease and efficiency into typically complex contract workflows. 

Contract lifecycle management software is quickly becoming a pre-requisite for any business, from medium-sized companies to large enterprises, looking to improve workflow efficiency and scale operations. As contracts are essential for any business, it is imperative to implement a software-based approach to managing them.  

Does Managing Contracts Manually Impede Business Efficiency? 

The traditional system of drafting, executing, and managing contracts manually comes with a lot of shortcomings. Undefined user roles, limited visibility, absence of status and performance tracking, drafting errors, and lack of process standardization are some of the many problems businesses face when dealing with their contracts the manual way. These issues are grave and can lead to inefficiencies and cause losses to the business.

Many organizations believe they can do without a software-based contract management system. However, the way contracts are managed impacts the business, and it’s now a best practice for firms to adopt an automated solution to manage all of their contracts.

The solution to documentation issues is legal software designed to manage business contracts throughout their life cycles. The software is set up to automate corporate contracts and align its document workflow into an organized and efficient process.  

As the contract management software market is forecasted to grow up to 2.9 billion US dollars by 2024, software that can seamlessly manage contract workflows is in high demand across the globe. 

Drawbacks Of Manual Contract Management

Manual contract lifecycle management brings several complexities that prevent businesses from efficiently supervising the creation, execution, and implementation of voluminous formal documents. 

  • Security is Compromised: A business contract is highly confidential, and its security is jeopardized when no robust storage solution is used. Folders and filing cabinets compromise the security of such documents containing sensitive information. Physical storage can also increase the chances of unauthorized access to contracts, putting the process at risk.
  • Disorganized Storage: Storing physical copies of business documents takes up a lot of space. In addition, physical contract storage can make retrieving contracts more challenging and time-consuming at the same time. Manual storage can also lead to lost contracts, bringing legal implications and extra costs to the firm. 
  • Human Errors: Drafting and contract management errors are often unavoidable with manual contract drafting. Employees can unintentionally make errors on the document, some of which can lead to severe problems later on. Errors can happen during the contract’s drafting and amendment stages when employees overlook something, forget to add a clause, etc. The presence of errors decreases the effectiveness of the terms of a contract. 
  • Risk of Non-Compliance: The very purpose of a contract is not achieved if it does not uphold the terms. If a contract is non-compliant with the industry standards and government regulations, it causes major problems to the business’s functioning. In addition, it also imposes penalties, delays market entry & poses a threat of reputational damage to the business. 
  • Unnecessary Delays: The process of managing contracts is quite a tedious one since it requires valuable time and attention to every minor detail. Right from curating a contract to approving and executing it, the procedure slows down when carried out manually. As a contract needs to be physically transmitted across different departments for approvals, often in the form of copies that aren’t uniform, delays are a frequent occurrence for businesses that haven’t automated their contract management procedures. 
  • Unavailability of Real-Time Tracking: Managing contracts throughout their life cycles is often neglected when done manually. This leads to missed deadlines, unfulfilled commitments, and missed opportunities for revenue generation. Without a proper contract tracking facility, companies can miss out on receiving crucial data related to projects. The lack of contract tracking in real-time also leads to project milestones being missed or overlooked by the firm. 
  • Lack of Clarity and Visibility: A manual contracting process makes it difficult for multiple parties to work on a single document simultaneously. Also, communication and coordination become challenging as there will be no clarity on the changes occurring on the document. Lack of visibility also makes it difficult for businesses to track contracts throughout their variations, leading to each party ending up with different versions of the contract. 
  • Lack of Process Standardization: When there is no established process for creating, executing, and monitoring contracts, many complexities arise. These processes consume a lot of time without an enterprise-wide standardized process flow. Without a systemized process, there will be silos across the organization, making collaboration more taxing for every contract requirement. 

These challenges make the workplace productivity go for a toss as employees will have to look into each step involved in contract management multiple times. By employing legal contract management software curated specially for corporates, businesses can cut costs and time spent managing their contracts. 

Innovative Solutions Offered By Contract Lifecycle Management Software

A contract management software solution brings forth an array of features that eliminate the limitations that come with manual contract management. The software can be deployed across businesses of all sizes to make the process quick, streamlined, and efficient. 

contract lifecycle management

  • Complete Contract Security: By means of selective access and eSign integration, a contract management software system adds multiple layers of security to a business contract. 
  • Convenient & Secure Cloud Storage: Contract repository software offers a common cloud-based storage solution where employees can easily store and access any document they require. 
  • AI-Enabled Document Drafting: With the utilization of Artificial Intelligence (AI), CLM software powers effortless contract creation. Template libraries and clause suggestion features eases the contract drafting process.  
  • Compliance With Business Regulations: Contract compliance software is designed to make documents’ clauses and terms compliant with the regulations implied by the government and the industry. 
  • Accelerated Approvals: By integrating electronic signing, intelligent clause approval, and multi-user signing, the concerned parties can authenticate the contract quickly through a CLM platform. In addition, it allows them to authenticate the document remotely. 
  • Contract Status & Performance Tracking: Contract tracking software provides critical information and statistics regarding the contract’s status and performance, which is essential for businesses to take further action pertaining to the project/transaction. 
  • Complete Contract Clarity & Visibility: With contract management software, user roles and responsibilities are clearly defined, helping users perform actions and managers oversee team members conveniently. Contract management software also provides visibility to the required stakeholders and parties, adding transparency to the process flow. 
  • Enterprise-Wide Process Standardization: CLM software acts as a productivity tool, standardizing the document creation, validation, implementation, and post-deployment supervision processes across the entire organization. 

Contract management for small businesses can help such firms focus on revenue-building and business expansion, as the entire document management procedure will be automated through AI-based software solutions. 

Smart contract administration software helps large businesses introduce efficiency into their document workflows. Since the volume of documents contracted every single day in these firms is significantly large, the need for an AI-driven document management system becomes essential. 

How Does CLM Software Improve Business Efficiency? 

Poor contract management can put businesses at risk and lead to unnecessary revenue losses. It hinders the smooth running of the business and also makes this regular workflow process inefficient. 

In addition, there are compliance issues, poor communication across parties, and the possibility of lawsuits without enterprise contract management software. These issues can bring down the business’s reputation in the industry and lead to high churn rates and low customer retention 

Integrating the best contract management software into their documenting process flows can enable organizations to streamline the document management process across their departments. 

Contract Management Software – In Action

Due to immense growth in the digital contracting space and the subsequent inundation of the contract management market by dedicated and function-specific solutions, businesses are left with an abundance of options for contract automation, not all of which are equal. 

The majority of contract management software caters to niche procedures and does not offer a comprehensive solution to the complex challenges businesses face when contracting en masse and at high speeds.  

The best contract management software tools offer businesses the ability to automate every aspect of their contract-based procedures. 

Here’s how.

  • Contract Drafting

Top contract lifecycle management solutions encompass all the functions of contract drafting software and combine these with templatization and smart clause suggest features to enable expedited contract drafting. 

SignDesk’s contract management software offers pre-configured templates and a comprehensive clause library for legal teams to quickly draft contracts.

Contract Drafting

  • Contract Approval

Getting contracts approved is an integral part of contract administration, but contracting software that automates administration without offering businesses a smart way to conduct approvals simply doesn’t cut it anymore. 

SignDesk CLM is integrated with intelligent approval matrices, which can be leveraged and customized to fit the structure of any organizational hierarchy. Businesses input the roles of stakeholders and SignDesk CLM automatically transmits contracts to the appropriate stakeholders in order. 

  • Contract Negotiation

Negotiations take up the most time among the steps involved in a contract’s lifecycle, with a typical negotiation period lasting anywhere from 4 to 6 weeks. Contract negotiations are drawn out for so long as the negotiating parties typically need to meet and engage in prolonged discussions for every contract negotiation session. 

SignDesk’s legal contract management software enables parties to negotiate contract clauses and terms digitally via tracking changes & redlining. Users can leave suggestions, accept or reject changes, and restrict contract access to just the appointed negotiators using role-based access models. 

Additionally, all parties can view the entire negotiation and comment histories pertaining to the contract under negotiation, boosting transparency and enabling increased trust which further expedites contract lifecycles.

contract approval and aegotiation

  • Contract Execution 

Signatures are the finishing touch to a well-negotiated contract; however, contract management software whose primary focus is execution risks missing the forest for a tree. 

Businesses require flexible contract execution workflows that allow them to invite multiple signers, get contracts signed at scale, and track signature status all while offering a wide range of eSignature types to suit any scenario. 

SignDesk CLM is integrated with eSignatures and customizable eSign workflows for businesses to get contracts signed on the go. Additionally, strong audit trails and evidence creation using digital signatures offer a high level of authenticity and security to contracts. 

contract signing and execution

  • Contract Repository 

Contract storage and repository software specializes in safely and securely storing legacy contracts, while also allowing executives and managers easy access to contracts whenever they’re needed. 

But contract repositories fail to improve business efficiency if they don’t unify contracts across business verticals. Contract management software that doesn’t provide a single source of truth creates roadblocks to smooth collaboration and is a source of friction between teams. 

By offering a centralized contract repository, SignDesk CLM ensures that all teams are on a level and have access to the same versions of contracts. SignDesk’s contract repository is also searchable, enabling seamless collaboration and retrieval. 

contract repository

  • Contract Tracking 

No contract management software is complete without a means for executives and managers to track and stay on top of contracts throughout their lifecycle. Contract tracking becomes especially essential when the contract is being performed.

SignDesk’s contract management software offers high-level contract tracking capabilities and AI-driven analytics for executives to make informed and smart decisions pertaining to contract performance. 

contract repository

SignDesk’s Simple Contract Management Software: A Smart Tool For Expediting Business Documentation 

Some of the most essential features businesses need to look for in contract automation software are: 

  • Business profile creation
  • Pre-configured templates & workflows
  • Smart clause suggestions
  • Real-time negotiations
  • Electronic signature integration
  • Complete contract security
  • Total contract transparency to authorized parties
  • Centralized repository
  • Custom notification modules 

Businesses can productively manage their documents if the CLM software leveraged supports these features. SignDesk offers businesses the best CLM software, complete with time-saving features and automated functionalities. 

SignDesk’s contract management software is among the top contract management software solutions offered for businesses of any size and provides a multitude of smart features that streamline and automate the documentation process flow throughout contract lifecycles. 

The software is designed to automate contract management systems across business teams, cut down cost and time, and introduce much-needed contract efficiency. 

Get in touch with SignDesk to learn how you can manage contracts the smart way with a free on-demand demo.  

Get a 30-day free trial now!