A healthy contract management process should constantly be adapting to technological advancements. As contract volume and contract complexity begin to grow, organizations must embrace digital transformation to be furnished with the right tools to streamline the contract management process. Such innovative CLM tools can be found within a trusted contract management software system. Read on to learn more.
The contract process involves overseeing contract lifecycle management (CLM) contract deliverables, contract terms, deadlines, and contract conditions while ensuring contract security and contractual and regulatory compliance. The contract process does not end at contract execution. Effective pre- and post-award contract processes are crucial for increased revenue, decreased risk, and a positive organizational reputation.
There are eight critical stages of the contract process that should be handled as efficiently and effectively as possible:
During any of the abovementioned stages, contract lifecycle bottlenecks can be disastrous – likely compromising the entire contract lifecycle.
Luckily, organizations need not worry about a decentralized and disorganized contract process thanks to leading contract management software! More specifically, below are five contract management software tools to leverage to improve the contract management software process.
Organizations of all sizes face the need to juggle multiple digital contracts simultaneously, with each contract being at a different stage of the contract process. Leading contract management platforms saves time, reduces risks, improves productivity, and maximizes a contract's value during the contract lifecycle.
The contract lifecycle is the contract process under which a contract is drafted, reviewed, signed, and executed. The "lifecycle" model is used to visualize a contract's journey. It begins with requests and ends when requests are entirely fulfilled - with the potential for renewal. The eight common steps are Requests, Authoring, Negotiations, Approvals, Signatures, Obligations, Compliance, and Renewals.
Full contract lifecycle management software allows organizations to oversee the full contract process, including requests through renewals and everything in between. CLM software improves the contract process with:
A contract repository is a centralized digital storage system used to manage and store contracts and related documents throughout their lifecycle. It is an essential tool in the contract process for several reasons.
Firstly, it provides a single, organized location for storing all contracts, making it easier to locate and retrieve specific documents when needed. Additionally, it allows authorized personnel to access contracts from virtually any location, ensuring that stakeholders can review and manage contracts as required. Security is a significant feature, as it ensures that sensitive information is protected through access controls. The repository can track different numbered versions of contracts with audit trails, basically ensuring that the latest version is always available and previous versions can be accessed for reference.
A secure contract repository can also help ensure contracts comply with relevant laws and regulations by maintaining detailed records and audit trails for any audits or compliance checks from external bodies. By automating contract archival and retrieval processes, a contract repository significantly reduces the time and effort required during the contract process.
Contract AI is used to analyze contracts and transform static documents into proactive building blocks for improved contract oversight, proactive opportunity identification, and risk mitigation. Automate data extraction and sensitive data identification, intelligently map risk, statistically analyze data, configure data thresholds to trigger intelligent automated workflows, leverage instant recommendations based on real-time data, and much more.
Auto-redlining with contract artificial intelligence can automate the inclusion of clauses from users' approved clause library, virtually ensuring that favorable clause language is included. Users can auto-redline documents ad hoc or configure them to auto-redline upon upload. They can quickly see and manage automated redlines and comments with comprehensive audit trails. Advanced contract process solutions are compatible with MS Word and CobbleStone's native online document editor for diversified auto-redlining.
Advanced contract process AI can provide proactive CLM field recommendations for metadata fields for contract clauses to streamline contract management software implementations. This functionality can allow teams to enjoy proactive, AI-based contract metadata field recommendations for extracted, common contract clause types. They can also enjoy visibility and governance of these recommendations at a glance - and decide which contract clause metadata fields to capture.
Finally, contract process intelligence can be leveraged for generative AI processes. Contract teams can search from a database of thousands of real-life clauses, generate new clauses from real machine-learning data, or leverage a user-friendly chatbot.
Contract process software helps compliance in several ways. As was previously mentioned, it provides a centralized platform where all contracts and related documents are stored, virtually ensuring that they are easily accessible and consistently managed. This centralization allows for better oversight and control over contractual obligations and terms. The software includes automated alerts and reminders for key dates, such as renewal or termination deadlines, which help ensure that actions are taken promptly and according to the contract terms. It also enforces standardization by allowing organizations to use predefined templates and clauses that comply with legal and regulatory requirements. This reduces the risk of non-compliant language or specific terms being used.
Contract process software maintains detailed records and audit trails of actions taken on a contract, providing a transparent history that can be reviewed for compliance purposes or during audits. By offering reporting and analytics tools, contract process software enables organizations to monitor compliance metrics and identify potential issues before they become significant problems. It can also help organizations with compliance risk mapping such as, for example, for OFAC compliance of counterparties, vendors, customers, and employees.
In addition to maintaining compliance, the contract process software selected should be, in and of itself, compliant with security regulations. For example, it should be SOC 1, SOC 2, and Privacy Shield compliant to start.
Best-in-class contract process software integrates with leading e-signature solutions, including Adobe Sign, DocuSign, signNow, and more. Additionally, advanced contract process software providers have native electronic signature platforms that provide a fast and easy way to sign and execute contracts.
Those involved in the document signing process can automate and supercharge document management, electronic signatures, and digital signatures with a digital certificate of authenticity and Uniform Electronic Transactions Act (UETA) compliance using public key infrastructure (PKI). They can enjoy additional security and compliance and a legally binding process.
Contract process software integrated with eSignatures keeps the signature process moving with bulk e-signatures and helps keep customers, employees, and partners happy. Users can easily manage signatures for non-disclosure agreements (NDAs), master service agreements (MSAs), consulting agreements, confidentiality agreements, sales contracts, and others. Electronic signatures are legally binding according to the Electronic Signatures in Global and National Commerce Act (E-Sign Act).
Electronic signature capability is best implemented with an electronic signature tool within contract management software to streamline signing processes. Leading electronic signature functionality offers:
Now that you know how you can improve your contract process with digital transformation, it is time to introduce the best possible solution for bringing your contract process to the next level: CobbleStone Software.
CobbleStone® is an award-winning, widely trusted contract lifecycle management software solution. CobbleStone's highly acclaimed source-to-contract management software suite - CobbleStone Contract Insight® - has helped thousands of organizations from a vast array of industries within both the public and private sectors to optimize the contract process, boost revenue, promote productivity, centralize CLM processes, and reap the most value from contracts.
Discover why thousands of contract managers trust CobbleStone to transform their contract processes. To learn more about CobbleStone’s unparalleled contract lifecycle management software, book a free demo with a CobbleStone Contract Insight expert today!
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* This article was originally published on August 16, 2021 and updated on May 27, 2024.
*Legal Disclaimer: This article is not legal advice. The content of this article is for general informational and educational purposes only. The information on this website may not present the most up-to-date legal information. Readers should contact their attorney for legal advice regarding any particular legal matter.