4 reasons every business should invest in contract management software
According to a recent study that was published by Gartner, there should be a rise in demand for contract management software in the near future. This can be attributed to many reasons, most notably new challenges regarding governance, risk and compliance, and an increase in M&A activity. However, many companies still do not see the need to invest in contract management software. Here a few reasons every business owner should consider investing in CLM software.
The changing nature of business environments and an increased complexity require a more holistic approach to contract management. A CLM software solution with template and clause management capabilities, along with robust rules support, will ensure the standardization of terms and language across the enterprise.
Realize the True Potential of Contracts
Many people see contracts as a set of terms of conditions, but they are much more than that. They are instruments that are used to ensure that commitments are followed through and recorded. Contracts are not only essential to avoid the risk associated with non-fulfillment but they are also essential to ensure a standard of performance. A good contract management software package should have a clear system of tracking benchmarks to be performed during the whole lifecycle of a contract to make sure that all obligations are met in time. CLM software works in conjunction with project management in that way and is a great tool not only for compliance but for performance as well.
Multi-platform system automation coupled with workflow automation across departments allows departments to have the level of visibility they need for the fulfillment of their portion of the contract. Having to go across departments to make sure that they are in compliance can be bothersome without automation and can lead to inconsistencies. A single repository is used for version history control as well as the finalized contract, making the auditing process much easier and more efficient.
Analytics and Reporting
Analytics is essential when it comes to contract management. A CLM software solution will act as your source for information on multiple contracts within your organization and performance. Real-time reports, data, and analytics give information on the cycle of a contract, active contracts, and contract compliance.
In addition, contract management software will allow you to minimize risk associated with contracts. A comprehensive template and clause repository, standard language notifications, and proper escalations to track terms in contracts and language to identify outliers and deviations will allow your organization to mitigate risk and issues before they lead to litigation and contractual lawsuits.
Contract management software is a must for any large organization that has to manage a large volume of contracts. It allows you to set templates for contracts across the board and limit the risk of inconsistencies. It also allows your company to better track the fulfillment of contracts and improves performance. Last but not least, contract management software will ensure that you limit risk to a minimum.