You’ve likely read the statistic before; World Commerce & Contracting (WCC) cites that roughly 9.2% of gross revenue is lost because of poor contracting processes. The last thing most companies want to do is lose money. That’s why smart leaders at the world’s top companies invest in Enterprise Contract Lifecycle Management (CLM) software to turn this startling statistic around.
What is Enterprise CLM Software?
Enterprise CLM is a comprehensive, streamlined approach to centralizing and managing an organization’s contracts from creation to post-execution. And Enterprise CLM Software helps business teams automate tedious and complex contracting processes to enhance collaboration across the enterprise, ensure compliance, an d improve productivity.
Before jumping into the many proven benefits of Enterprise Contract Management (ECM), it’s important to take note of the what-ifs. What if your organization chooses to stick with outdated, manual contracting? What if you think those storage cabinets/disks/servers full of contracts are sufficient? Well, it could get ugly.
Traditional ECM does not offer a 360-degree view of the contract’s lifecycle, leading to a lack of thorough oversight and clear transparency across departments and teams. An automated Enterprise Contract Management software solution consolidates and streamlines contract management and extends access and control beyond Legal to the entire organization, from Sales and Marketing to HR and Procurement. Not only does this allow legal teams to focus on higher-level, more strategic initiatives, it provides a digital audit trail that helps reduce risks and empowers all parties to be accountable for their role in the contracting process.
In addition, the average Fortune 2000 company holds approximately 20,000-40,000 active contracts. Manually managing each and every contract is an overwhelming feat; having the right digital tools and processes enables actual success in contract management. And unfortunately, the consequences of improper ECM create tremendous financial, legal, and reputational risk for the entire business.
Financial Risk
Creating, reviewing, and executing one contract can cost as much as $49,000, so it must be done correctly the first time. Additionally, slowed negotiations, missed renewals, or ineffective collaboration can also prove costly if mistakes are made or, worse yet, forgotten altogether.
Legal Risk
It makes sense that a legally binding agreement poses many legal threats if not executed properly. Inability to produce/find a contract during a legal proceeding. Non-compliance errors. Contract breaches. Confidentiality violations. The list goes on.
Reputational Risk
Failure to adequately protect contracts, poorly executed agreements, delayed negotiations, or lack of process organization can cause a fractured reputation in the marketplace. And in today’s media-filled space, word travels fast and can quickly create damaged relationships and unsavory publicity.
Who needs Enterprise CLM Software?
Medium to Large Businesses
Taking an inefficient manual approach to organize and manage all of your contracts is nearly impossible, leading to chaos, lack of control, and potentially devastating consequences. Enterprise CLM means a proven, automated system streamlining all contracting processes for greater efficiencies and improved legal oversight. All contracts are stored in one centralized, secure repository for quick retrieval.
Organizations Operating in Multiple Locations
Whether an organization is global, has several locations in the same area, or transitioned to more at-home workers in light of COVID-19, it can wreak havoc on contract management. Disparate systems, lack of standardization, missed communications, and bottlenecks become commonplace when a CLM platform is not in place. The right enterprise CLM tool allows access to your teams anytime and from anywhere. It ensures consistency across the business and maintains secure access to only those specified.
Enterprise Businesses
Enterprise businesses not only have to manage a large volume of contracts, but it is imperative that they also meet stringent regulations and layers of compliance requirements. This is especially true for healthcare, pharma, and financial services organizations. Enterprise Contract Lifecycle Management software contains pre-approved, up-to-date language and terms that adhere to both internal and external regulations. It tracks all changes to the agreement, offering total transparency for all involved parties. It also sends reminders of key milestones and dates to avoid missing important deadlines.
How Does Enterprise CLM Benefit You?
Contract Lifecycle Management offers tremendous benefits to all users across departments. From Legal to Sales to Procurement and beyond, its powerful functionality improves the way you do business.
Improve Contact Creation
Self-service contracting enables users to generate agreements without Legal’s assistance. The platform includes templates, pre-defined business rules, and current clauses to facilitate users’ contract creation. This accelerates contract creation by empowering others to start the cycle without relying on an overwhelmed Legal department. It improves cycle times, increases revenue, and reduces legal operating expenses.
Increase Visibility
A centralized, digital, secure contract repository stores all legal agreements and documents – including all versions. Team members can instantly search for terms, contracts, or clauses without shuffling through thousands of documents. Better transparency facilitates enhanced communication between departments and saves valuable time.
Supply Chain Tracking
You can track a contract’s terms and conditions throughout its entire lifecycle and leverage the data to identify inefficiencies or areas of improvement in your supply chain.
Automate Workflows
An intelligent Contract Management system can build customized workflows to meet your organization’s specific needs, such as routing and signing approvals. This decreases errors throughout the agreement’s lifecycle and expedites the entire process.
Reduce Costs
The contract creation and approval features can significantly reduce the labor costs associated with processing and creating contracts, providing significant financial value to your business.
Risk Management
Leveraging one platform, instead of piecing contracts together from multiple sources, makes contract risk easy to measure and manage.
How Do You Choose the Right Enterprise Software?
Choosing the right CLM solution takes time with many considerations. However, the below checklist can help get you started:
Ease of use:
A good interface or complex processes will encourage employees to learn how to use it and can make training difficult. Choose an easy-to-use system that will maximize the program’s value.
Contract Features:
Unlimited templates, conditional logic, conditional approvals, single sign-on, advanced electronic signature, renewal reminders, custom branding, and bulk actions are just a few of the features that are essential for a successful CLM platform.
Collaboration:
One of the primary benefits of leading CLM software is streamlined communication and collaboration with internal and external stakeholders. Without this, delays, bottlenecks, and potential errors become very burdensome and can cause negative financial implications.
Risk Management:
Intuitive modeling and intelligent alerts help reduce the amount of risk associated with your contracts and diminish human error.
Configurability:
Make sure your system is configurable and scalable to meet your company’s current and future needs. Simple integrations with everyday applications ensure teams feel more comfortable and confident using the system.
Data Security:
We all know security is imperative. The system should offer different levels of protection for users and should be easily managed by an assigned administrator(s).
Procurement Process:
Comprehensive management of procurement contracts and other binding agreements helps avoid missed deadlines and opportunities.
Customer Support:
Having a trustworthy relationship with your software provider is critical. From exploration to implementation and beyond, there should be open lines of communication and easy accessibility.
Why ContractPodAi for Enterprise CLM Software?
We are proud to offer the best-in-class Contract Lifecycle Management software used by companies around the globe. Our robust and intuitive system has advanced Artificial Intelligence (AI) capabilities to give you total visibility, command, and control over your legal records. Our team uses proven best practices to maximize the platform’s capabilities to provide you with the best Return on Investment (ROI), accelerate your contract processes, and build better relationships with your stakeholders.
Contact us today to start your CLM journey.
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