When it comes to managing contacts, it is important to have a system that works for you and your business. Contract management software can improve your efficiency and increase profits. With the right product, you will get the most out of your agreements.
This article will explain the benefits and provide tips on how to choose the software.
Benefits of Contract Management
With the automation trend, it's becoming quite common for companies to use software to manage their contracts these days. And there are some really good reasons for doing so. Let’s break them down for you:
1. Distribute the workload more efficiently
Legal teams have a lot on their plate. According to the 2021 EY Legal Survey, large enterprises manage approximately 350 contracts per week. Every agreement puts thousands of dollars at stake — so it's no surprise that companies are looking for ways to streamline the process.
Companies that follow the long-established concept of working smarter, not harder, rely on automation. It provides for agile division between manual and automated assignments. Without the burden of mundane paperwork on their shoulders, your team can focus on more important things like negotiating better terms or searching for ways to boost profits.
2. Simplify contract creation
The benefits of contract management are apparent from the very first step of the contract lifecycle. It is much easier to kickstart document creation when you have templates at your disposal. Teams who rely on contracting — HR, marketing, sales, procurement — can complete common drafts on their own, without involving the legal department.
Plus, features like error checks and auto-complete can prevent human errors. With this toolkit, you can outline the text within minutes without compromising quality.
3. Speed up contract approval and signing
Contracts are not “single-player missions”. They involve several parties and their respective employees. This makes redlining and approval extremely difficult. Corrections can get lost in long email chains or between different versions of a file.
But with e-contract management, you can work in the cloud and keep track of changes. You don’t need to double-check if all corrections were added to the document. Thus, you and your partners can speed up negotiation and move on to signing.
4. Standardise your contracts
Most agreements aren’t unique. Think of employment contracts, service contracts or contractor agreements. There is no need to start a process from scratch if your company is dealing with certain documents daily.
You can improve turnaround time with pre-approved contract templates. Use LIGA UNITED to build your custom template now.
Standardisation also helps to mitigate risks. If your legal team, for instance, identifies a weak clause, you can easily make amendments throughout your entire document base.
5. Find documents in one click
Did you know that 71% of companies can't find at least 10% of their contracts? Such figures are not surprising, considering how many documents modern firms manage every day. A missing file can create several complexities as the businesses have no idea what they have to do, what deadlines are, or when to suspend a document.
Uploading your contracts to e-storage can help you avoid "blind spots” in paperwork. The latter is important for search and security reasons, which we will discuss in the following section.
6. Save contracts in a secure storage
A cloud storage system or document repository is not just for storing files. It is crucial from a data safety standpoint, which is one of the biggest concerns for modern firms.
It's not an internal matter to have proper safety protocols in place. Your clients, vendors and partners would most likely prefer to ensure the security of their information, especially if your contract includes sensitive clauses. And you can guarantee that you are a reliable company with the benefits of contract management.
7. Mitigate contract risks
From initiation to execution and renewal — contracts are full of risks at every stage. However, all of them are preventable. With automation, you can check the reliability of parties and prevent cooperation with sanctioned or bankrupt companies.
Plus, the software can check your file for hidden terms and common mistakes. Documents often contain errors in sums, dates, party details, and formulations - which all can be automatically detected.
8. Create a contract timeline
If your team has to manage hundreds of documents simultaneously, it’s easy to miss a deadline. It may also create confusion within the team if they don’t know who is responsible for certain arrangements.
E-contracting allows you to keep track of important dates automatically, so you’ll always fulfil your obligations on time and avoid penalties. It is also crucial to prepare for renewal in advance, and you’ll be in full control of the process with automated alerts.
Make sure your contracts run smoothly, that deadlines don’t catch you by surprise, and promote transparency and accountability within your company — all with LIGA UNITED.
9. Stay up-to-date with changes
Contracts don’t remain constant over time. The economic and political environment may change unexpectedly, leading to regulatory updates. The stability of companies which signed an agreement may shift due to negative media stories or lack of profits. Businesses may go bankrupt. All those factors have an impact on whether the parties can fulfil their obligations.
Automated solutions make it easy to keep track of the most important details. You can set up alerts for legislation, business news, and companies you cooperate with.
10. Turn data into big data
With digital contracting, your documents are no longer boring pieces of paper that sit on your shelf collecting dust. When you upload files to electronic storage, you transform static PDFs into bits to analyse. You make metadata and file information searchable. In other words, you turn data into big data.
Once that is established, you’ll be able to analyse the performance of company agreements, determine the weakest points and get insights on how to improve the workflow.
How To Choose Contact Management Software
There are many products available today in the market. To maximise the benefits of contract management, consider the following tips when making a choice:
Ensure data safety
Contracts contain sensitive information, so it's crucial to ensure that your software provides a proper level of data security. Consult with your security specialists to determine whether the product includes necessary features such as encryption, 2-factor authentication, etc.
Additionally, keep in mind the legal requirements of your jurisdiction, such as compliance with SOC 2 Type II and HIPAA/FISMA regulations.
Determine your needs
Your business may have different automation needs depending on its size, sector, and region. Before ordering a product, analyse the most common tasks your legal team needs help with. Some companies prioritise standardisation, while others prioritise analytical capacities or text checks.
Each IT solution offers a different range of features. You can choose a product tailored specifically to contracting or adopt a well-versed automation tool that solves legal research, due diligence, and other tasks.
Keep your jurisdiction in mind
Contracts are built based on specific state regulations, which are reflected in standard clauses, document drafts, and court cases relevant to certain contract types. Choose an IT solution designed for your region to ensure the most comfortable user experience.
For example, LIGA UNITED is designed for the UK market and includes relevant information for UK legal and compliance experts such as litigation, company files, and contract templates.
Think beyond contracting
Automation doesn't start or end with contracting. Companies that achieve the best results evaluate all their operations and implement changes where necessary. Improving one process may have an avalanche effect on other operations, so don't wait to make improvements. In-house legal departments rely on technology for legal research, monitoring, and compliance checks. Bring all those areas to the next level with LIGA UNITED.
Test the product
Businesses don’t like buying “a cat in a sack”. Especially when it comes to the tools that change their operations. So don’t hesitate to test the software and see if it’s useful for your team. Evaluate the usability and relevance of its features.
Don't be discouraged if you don't find the perfect match right away. There are multiple products available, each with different toolkits and volumes of information. Contact our team to order the LIGA UNITED demo.
Contract management software can be a real game-changer for businesses. It can help you work smarter, not harder by making it easier to create, approve, and manage contracts. Plus, it can help you stay on top of changes, find documents easily, and reduce contract risks.
If you need the right software for your business, feel free to contact our team.
Contract management is crucial for businesses as it ensures that agreements are fulfilled, parties are protected, and processes are streamlined. This results in time and cost savings while keeping all parties content with the agreement.
In short, best practices include having a standardised process, utilising technology, establishing clear communication, monitoring performance, and maintaining a centralised document repository.
Before purchasing a product, identify specific business needs, analyse software features, evaluate data security, and test it first.