Contracts are the cornerstone of commerce and human cooperation. But managing them can be complex.
The Contract Lifecycle Management process encompasses multiple functions, including drafting, authoring, negotiations, and monitoring and reporting. Companies need a single system that can handle all of these tasks efficiently and effectively.
For this reason, new technologies such as CLM have emerged to streamline and add structure to these processes.
Stage 1: Requests
Contracts are at the heart of commerce, and they need to be managed efficiently. Whether it’s fundraising agreements, vendor contracts or other high-volume documents, centralized data, collaborative processes and automation are key to successful management.
The contract intake and request step is where the foundation of a contract is established. Contract lifecycle management software allows you to standardize this process through customizable contract intake forms that help to speed up drafting time by automatically populating contract templates with the information captured.
Once the contract intake and request process is complete, it’s time to start the drafting phase of the contract, which is also known as contract authoring. This stage outlines obligations and ensures that general contractual rules and those specific to the type of contract are followed. Robust compliance management helps to decrease litigation fees/penalties, bottlenecks, and other costly issues. Contract authoring is made easier by having access to the right contract data, including terms, responsibilities, key dates, and counterparty information.
Stage 2: Authoring
Contract drafting is a complex, high-stakes business process. It requires collaboration between multiple stakeholders, back-and-forth communication, and legal research to create a draft that meets company standards, business needs, and is ready for negotiation. Many contract management solutions focus on automating the drafting and editing process, saving teams time while creating professional, accurate contracts.
Once the drafting is complete, it must go through approvals to ensure the finalized contract meets obligations, milestones, and compliance standards. Legal departments need to be able to track and manage this process and any changes made, including who made the change and when.
New contract lifecycle software helps to centralize and streamline this process with customizable, automated workflows. It also provides a platform for collaboration between internal and external stakeholders that allows them to review, edit, and sign documents with ease. It also allows managers to set notifications so that they are notified when their contract needs their attention or there is an update.
Stage 3: Negotiations
This is a critical stage where each party presents their opening positions or demands. At this point it is critical to consider your negotiation strategy in order to gain a clear understanding of the other side’s motivations and objectives. It is also an ideal time to ask for any clarifications, bolster and justify your original position.
This phase builds on the framework of specifications drafted during the authoring stage and is an opportunity for contract parties to negotiate terms, conditions, and other provisions. Contract negotiations should be collaborative and back-and-forth, involving a variety of stakeholders. Version control tools are key for managing this process and ensuring that the right people have access to contracts at each stage.
Contract approvals are an important part of contract management and the length of time this takes can depend on how many departments and personnel need to be looped in. Using Contract Lifecycle Management software with built-in approvals can help to streamline this process.
Stage 4: Approvals
Contract approvals are a critical part of any agreement. When a contract is ready for signature, the system sends it up the chain to approvers, which can include managers and officers. This phase allows all parties involved to review the contract, make changes, and agree to terms.
It’s not uncommon for contracts to undergo a number of revisions throughout the negotiation process. The system should be able to track version history, and provide the right users with full visibility of any changes that occur.
There are few things that slow down a contract process more than physical paperwork. CLM software systems can improve the flow of documentation by reducing the amount of time it takes for teams and external parties to receive, review, and move contracts through the process. This eliminates bottlenecks and improves accountability. It also ensures that all parties understand their obligations and responsibilities and mitigates risk.
Stage 5: Implementation
Contract management is a critical business process. Yet, it is largely overlooked when evaluating enterprise business software investments. This is because most major business systems—like cuneiform tablets, CRM and ERP—provide value as a system of record before they become a system of engagement or intelligence.
This stage involves implementing the contract lifecycle with a centralized repository and easy-to-access documents. Contract managers and other stakeholders can find contracts, clauses, associated documents, and key terms quickly and easily with a digital Contract Lifecycle Management.
This stage of the contract lifecycle is important for the organization because it ensures that contracts are organized and reviewed in a consistent manner. In turn, it helps prevent the risk of non-compliance and the costly aftermath that can result from it. This is especially important for heavily regulated industries like financial services and heavy manufacturing. Contract management systems also help ensure that contracts are complete and accurate.
Stage 6: Maintenance
During the Maintenance stage, you monitor contract terms and obligations to ensure compliance. Keeping up with contracts is important for any organization, but especially those in heavily regulated industries. With CLM services, you can ensure compliance and reduce risk by streamlining contract management processes and eliminating bottlenecks.
Throughout the process, you get alerts and notifications when it’s time to review a contract or if there’s an upcoming renewal. Moreover, you can revise each contract through proposed change requests and amendments to address any issues.
For the best results during this phase, you should consider partnering with a software provider that offers eSignature solutions. Having a seamless eSignature system in place will allow you to sign contracts quickly and easily with any device. The process will also make it easier for your teams to complete their duties. This will save your organization time and resources, as they’ll no longer have to rely on cumbersome manual procedures.
The Contract Lifecycle Management process encompasses multiple functions, including drafting, authoring, negotiations, and monitoring and reporting. Companies need a single system that can handle all of these tasks efficiently and effectively.
For this reason, new technologies such as CLM have emerged to streamline and add structure to these processes.
Stage 1: Requests
Contracts are at the heart of commerce, and they need to be managed efficiently. Whether it’s fundraising agreements, vendor contracts or other high-volume documents, centralized data, collaborative processes and automation are key to successful management.
The contract intake and request step is where the foundation of a contract is established. Contract lifecycle management software allows you to standardize this process through customizable contract intake forms that help to speed up drafting time by automatically populating contract templates with the information captured.
Once the contract intake and request process is complete, it’s time to start the drafting phase of the contract, which is also known as contract authoring. This stage outlines obligations and ensures that general contractual rules and those specific to the type of contract are followed. Robust compliance management helps to decrease litigation fees/penalties, bottlenecks, and other costly issues. Contract authoring is made easier by having access to the right contract data, including terms, responsibilities, key dates, and counterparty information.
Stage 2: Authoring
Contract drafting is a complex, high-stakes business process. It requires collaboration between multiple stakeholders, back-and-forth communication, and legal research to create a draft that meets company standards, business needs, and is ready for negotiation. Many contract management solutions focus on automating the drafting and editing process, saving teams time while creating professional, accurate contracts.
Once the drafting is complete, it must go through approvals to ensure the finalized contract meets obligations, milestones, and compliance standards. Legal departments need to be able to track and manage this process and any changes made, including who made the change and when.
New contract lifecycle software helps to centralize and streamline this process with customizable, automated workflows. It also provides a platform for collaboration between internal and external stakeholders that allows them to review, edit, and sign documents with ease. It also allows managers to set notifications so that they are notified when their contract needs their attention or there is an update.
Stage 3: Negotiations
This is a critical stage where each party presents their opening positions or demands. At this point it is critical to consider your negotiation strategy in order to gain a clear understanding of the other side’s motivations and objectives. It is also an ideal time to ask for any clarifications, bolster and justify your original position.
This phase builds on the framework of specifications drafted during the authoring stage and is an opportunity for contract parties to negotiate terms, conditions, and other provisions. Contract negotiations should be collaborative and back-and-forth, involving a variety of stakeholders. Version control tools are key for managing this process and ensuring that the right people have access to contracts at each stage.
Contract approvals are an important part of contract management and the length of time this takes can depend on how many departments and personnel need to be looped in. Using Contract Lifecycle Management software with built-in approvals can help to streamline this process.
Stage 4: Approvals
Contract approvals are a critical part of any agreement. When a contract is ready for signature, the system sends it up the chain to approvers, which can include managers and officers. This phase allows all parties involved to review the contract, make changes, and agree to terms.
It’s not uncommon for contracts to undergo a number of revisions throughout the negotiation process. The system should be able to track version history, and provide the right users with full visibility of any changes that occur.
There are few things that slow down a contract process more than physical paperwork. CLM software systems can improve the flow of documentation by reducing the amount of time it takes for teams and external parties to receive, review, and move contracts through the process. This eliminates bottlenecks and improves accountability. It also ensures that all parties understand their obligations and responsibilities and mitigates risk.
Stage 5: Implementation
Contract management is a critical business process. Yet, it is largely overlooked when evaluating enterprise business software investments. This is because most major business systems—like cuneiform tablets, CRM and ERP—provide value as a system of record before they become a system of engagement or intelligence.
This stage involves implementing the contract lifecycle with a centralized repository and easy-to-access documents. Contract managers and other stakeholders can find contracts, clauses, associated documents, and key terms quickly and easily with a digital Contract Lifecycle Management.
This stage of the contract lifecycle is important for the organization because it ensures that contracts are organized and reviewed in a consistent manner. In turn, it helps prevent the risk of non-compliance and the costly aftermath that can result from it. This is especially important for heavily regulated industries like financial services and heavy manufacturing. Contract management systems also help ensure that contracts are complete and accurate.
Stage 6: Maintenance
During the Maintenance stage, you monitor contract terms and obligations to ensure compliance. Keeping up with contracts is important for any organization, but especially those in heavily regulated industries. With CLM services, you can ensure compliance and reduce risk by streamlining contract management processes and eliminating bottlenecks.
Throughout the process, you get alerts and notifications when it’s time to review a contract or if there’s an upcoming renewal. Moreover, you can revise each contract through proposed change requests and amendments to address any issues.
For the best results during this phase, you should consider partnering with a software provider that offers eSignature solutions. Having a seamless eSignature system in place will allow you to sign contracts quickly and easily with any device. The process will also make it easier for your teams to complete their duties. This will save your organization time and resources, as they’ll no longer have to rely on cumbersome manual procedures.
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