Why Contact Lifecycle Management Is More Important Than Ever Before?

By Author: Manu Contract
Total Articles: 1
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As the name implies, Contract Lifecycle Management (CLM) is the process of tracking, managing and monitoring the contract via various stages of its lifecycle. An efficient CLM solution streamlines the entire contracting process while enhancing productivity and reducing risks.

It focuses more on centralizing contract storage and automating the creation, management and execution of all types of contractual agreements. If you still want to know about “what is contract lifecycle management”, scroll down the page.

Why contract lifecycle management is vital?

Contracts touch every department in the business environment, including finance, sales, legal, HR and procurement. They govern every single penny that flows into the business. It is the major reason for poor contract management leading to high financial loss and risks.

According to recent research, poor contracting costs businesses 9% of their annual revenue. Aside financial aspect, having an efficient contract management system is vital for the following reasons.

• Drafting ...
... the contract via the traditional approach takes time and effort. Contract documents usually contain several pages, and running through them manually maximizes the chance of missing vital errors.
• The absence of a contract lifecycle management system makes negotiations longer than actual time and involves several back-and-forth emails. Thus, comparison between changes in versions becomes harder.
• The lack of automated email and in-app notifications makes the companies lose plenty of renewal opportunities. Without the automated system, finding and amending the changing legal terms becomes tedious and time-consuming.
• The biggest challenge for any company is the loss of contracts. As per the reports, over 10% of the company’s contracts are either lost or missing. It brings several issues for the companies in various ways.

Advantages of adopting CLM software

Adopting modern CLM software is the only reliable and affordable solution to handle the issues mentioned above effectively. This software bridges each contract phase right from initiation to contract renewal. So, companies are no longer required to worry about managing their contracts effectively.

It assists legal, procurement, finance and sales professionals in expediting the contract management processes by leveraging supplier and sourcing information effectively. In the central digital repository, the software stores bids, negotiated prices, supplier data, and contract terms. It helps companies sign contracts quickly, maintain visibility and obtain trust sooner.

Companies using CLM software create the central repository for every contract easily. It makes them automate and streamline all the processes involved in contracts. So, it removes the need for paper and ink from contracting. In addition, the company can reduce potential risks and revenue leakage with the help of features involved in modern CLM software.