Contract Management Software – An Essential Business Tool
In an era where every business process is driven by technology, contract management software is fundamental for growth. It is designed to enable businesses to implement all their documents effectively, right from their creation, up to execution & renewals. The software helps govern the various stages of business documents seamlessly.
What Is CLM Software?
Contract Lifecycle Management software is designed to offer a variety of features & functionalities that can help businesses manage large volumes of contracts in a more efficient manner. It attempts to add value to every stage of contract management & streamlines the entire process flow.
The technology introduces automation through the different phases of managing business documents. CLM is an essential resource for new-age businesses to streamline their contract management system & overcome the challenges that accompany it.
Businesses can adopt the software to automate the management of contracts in each of their stages. Legal departments, especially, find that contract management offers huge opportunities for automation.
The CLM Process – How Does Contract Management Software Work?
Contract management technology employs a step-by-step workflow that covers all the stages of a document’s lifecycle. The software generally includes this workflow:
Generate → Collaborate → Negotiate → Authenticate →Track →Renew
The software automates all these stages that are typically part of most business contracts. Here is how it works:
Creating the Contract
Drafting the contract manually requires a lot of time & effort which businesses can do away with by using efficient software that automates contract creation. By offering facilities like a document authoring wizard & templates with pre-populated fields, the software makes contract generation quick & easy. Automating this stage of contracts also plays a vital role in eliminating inaccuracies, like missed details, spelling errors, etc.
Collaborations Between Stakeholders
This stage allows multiple departments, stakeholders, & parties to outline the contract’s terms & conditions. The parties & cross-functional teams involved can work on the clauses present in the contract to ensure all the required content is laid out in the document. With a CLM tool, this process becomes extremely simple as users can collaborate online & work on a single contract simultaneously.
Discussions & Negotiations
The next stage of contract management enables parties to negotiate the clauses set out in the contract. The software simplifies this process by allowing stakeholders to collaborate from wherever they are. Contract management software makes transactions seamless by offering an online platform for parties to negotiate & reach agreements.
Authenticating the Contract
In this stage, the parties authenticate the contract by getting it stamped & signing it. A software-based contract management tool eases this process by offering inbuilt contract stamping & signing solutions. Post negotiation, the contract can be digitally stamped by paying stamp duty online via the platform. The parties can then proceed to electronically sign the contract to facilitate its execution.
Contract Tracking
Tracking & evaluating a contract once it has been executed is of utmost importance for any business. The software comes with a contract tracking system, which makes contracts dynamic, enabling the extraction of insights & actionable data from the way they perform. Businesses can use the data to make future decisions more smartly. In addition, tracking a contract post execution offers a huge potential for mitigating risks that may arrive.
Contract Storage
Cloud-based contract management software makes document storage & retrieval much simpler. Businesses can store large volumes of agreements securely in a centralized contract repository made available on the contract management platform. Users can quickly look back at documents as the contract database software simplifies document recovery.
Contract Updates & Renewal
Contracts will need to be renewed or terminated after a defined period. An automated contract management system ensures the intended recipients receive reminders & alerts whenever critical dates such as contract expiration, cancellations, etc., are approaching. This feature helps businesses stay on top of all their contracts & significantly reduces the chances of missed deadlines.
Cutting-Edge Features For Smart Contract Management
Contract management software is built with an array of business-centric features that enable a smooth & effective way to manage company documents.
- Template & Clause Libraries: Contract software solutions offer businesses an extensive contract clause library & template options that play a key role in speeding up contract creation.
- Digital Collaboration: By providing a platform for stakeholders to collaborate virtually, negotiations can be carried out much faster, enabling quick finalization & execution of contracts.
- eStamp & eSign Support: Contract software is built to offer eStamping & electronic signature functionalities that make contract authentication effortless. They also enable electronic evidence creation which may be required at later times.
- Performance Analytics & Audits: By offering statistical analysis on performance metrics, contract software simplifies decision making for businesses. Detailed audit reports of signatures & digital stamps act as document activity evidence.
- Cloud Storage: Businesses can have a centralized digital repository of all the contracts they produce for safe keeping. Cloud storage enhances document visibility & accessibility multifold, with options for clause meta-data tagging & easy search-retrieve functionalities.
- Configurable Workflows: Businesses can use low-code building blocks to create & customize contract processes according to their business requirements. All workflows are managed in real-time with features for contract milestone tracking and a comprehensive contract activity tracker.
- Tamper-Proof Documents: Contract software makes business documents highly secure by providing controlled document access. It helps make confidential data contained in contracts tamper-resistant.
Smart CLM Automates Contract Management Across Industry Segments
Having a contract automation solution in place can make contract management workflows streamlined & uncomplicated for businesses operating in various industries. Some of the industry sectors that can benefit from this software include:
- Financial Institutions: An inefficient way of managing company contracts can subject businesses to major regulatory risks. That is why it is essential for financial institutions like banks & NBFCs to make contract administration a priority.
Automation can help majorly in this respect by offering finance teams improved contract trackability, simplified version control, and better document visibility, all while ensuring a high level of security. - Retail & FMCG: Retail businesses have to compete in volatile markets with razor-thin margins. Hence, top-notch contract management is a necessity for these firms. Retailers must have complete visibility into sales performance as well as supply chain operations to stay ahead of their competitors.
Utilizing the best contract management software helps retail businesses overcome these issues by offering a platform for enhanced collaboration with vendors, improved contract visibility & risk management.
- Healthcare Sector: Contract management software is essential for healthcare industries to set up clear guidelines & expectations well ahead. It helps these businesses reduce the chances of disputes down the road.
Using the software can help them maintain consistency with all their contracts, optimize their security, prevent errors & keep track of all the healthcare contracts efficiently. By extracting statistics on the contract’s performance, these firms can experience ease in making decisions.
- Insurance Companies: Using automated contract software allows insurance firms to centralize contracts that span various facilities & insurance types. An automated approach to managing the plethora of insurance agreements, helps these firms create, execute & track them more efficiently.
The AI-backed system of smartly managing contracts helps reduce the chances of risks for insurance firms by ensuring contract compliance.
- Pharmaceutical Businesses: Pharma companies can benefit from contract management by developing policies that safeguard them from force majeure circumstances. Before releasing a new medication to the public, these companies must also complete a plethora of applications to guarantee compliance with administrative requirements. Using automated contract management reduces this burden for these companies.
- Manufacturing Industries: Manufacturing businesses are required to enter into numerous contracts every day which they can streamline & simplify with contract automation software. The software also enables smooth tracking of each contract across its lifecycle, making it a very useful tool for manufacturers.
- IT Companies: Contract administration software helps IT firms easily create & implement error-free documents using pre-approved clauses & document templates. The technology also helps send out automated reminders whenever IT product licenses need to be renewed.
Which Business Verticals Need Contract Management Platforms?
Utilizing an automated contract management solution can give many business departments an upper hand with their workflow. Legal, operations, human resources & sales are some of the teams that can hugely benefit from using this software.
- Operations Teams: Companies have specialized teams built to collaborate with vendors for procuring products & services. Their typical process flow would require obtaining negotiating vendors’ terms & conditions, approvals from multiple personnel & keeping track of vendor agreement renewals.
Smart vendor contract management software can streamline all of these processes. By offering features such as remote contract stamping & signing, online negotiation support, automated reminders & contract performance tracking, the software enhances the operational efficiency of these teams.
- Legal Teams: In a business, legal teams have a high level of authority over contracts & are creating & executing multiple agreements on an everyday basis. In-house legal departments can use software contract agreement platforms to simplify their tasks multifold.
Contract management software is built with contract template libraries & pre-populated contract clauses with customizable fields, enabling legal teams to draft contracts in a fraction of the time.
- Sales Teams: Sales representatives can benefit from automating client contracts. It saves a lot of time & allows them to close deals at a much faster rate. The time saved by automating contract creation & execution procedures helps sales reps clinch more deals in a remarkably short time span.
Business agreement software for sales reduces the dependency on legal teams by ensuring contract compliance. The online contract repository system even helps these teams execute contracts remotely, boosting sales productivity & performance.
- HR Teams: The human resource departments in organizations are tasked with producing high volumes of employee contracts as hiring takes place almost perpetually. Contract software simplifies this for HR associates by automating onboarding & recruitment paperwork such as employee agreements & NDAs.
In addition, managing employee exit formalities becomes hassle-free for HR teams to deal with using contract management technology. With the tool, clearance forms, due certificates, etc., are processed automatically across the required departments saving plenty of time & effort.
SignDesk CLM – Best Contract Software For Businesses
Managing contracts through AI-enabled software can no doubt make the process smooth & seamless. CLM software is indispensable for businesses as it ensures each of their documents’ objectives are achieved. It is pivotal to maximize the performance of all contracts businesses produce.
Businesses can leverage SignDesk’s contract automation software to effectively manage contracts throughout their entire life cycles. SignDesk offers businesses one of the top contract management software solutions to create, collaborate, execute, store, & renew their contracts.
Get in touch with our CLM experts to understand how SignDesk can change the way you manage your business contracts.
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