Why do most companies require contract management software? The average Global 1000 corporation maintains over 40,000 active contracts, most of which are still managed in a traditional manual method. However, approximately 25% of Global 2000 companies have implemented some form of contract management software to help manage corporate contracts. Contract management software automates the contracting process from contract creation and negotiation through monitoring, compliance and renewal. The solutions typically maintain a warehouse or central repository of corporate contracts improving a company’s access, visibility and control over contacts. Most solutions also offer the ability to warehouse standard contract and business terms and conditions and template contracts as well. Research has demonstrated that contract management software allow companies to better realize savings achieved during procurement negotiations and procurement spending, improve sales effectiveness, and increase compliance by allowing contracts to drive day-to-day operations.
Almost every company maintains active contracts and can benefit from software to help track and manage them. Today, there are many solutions in the marketplace, however; it is recommended organizations look at more robust, yet easy-to-use systems. Most contract management software vendors offer free demos, consultations, and even trials to help you make the best selection.
What Challenges are Businesses Likely to Face Without Contract Management Software?
Today, by employing stable, feature-rich contract management systems, businesses can reduce their potential risks and challenges. Before exploring why any company can benefit from a contract management system – lets discuss the typical challenges and WHY you may require a complete contract management system.
Below are some of the main challenges businesses face, as related to their contracts and agreements.
- No standardized way of storing contract documents and data. Contracts are in paper format, locked away in file cabinets or other non-visible locations
- Missed Milestones, Tasks, Dates and Renewals
- Duplication of data entry due to having multiple systems to manage contracts throughout the enterprise – without connectivity to other Systems
- No enterprise wide standards for contract review, approvals and escalation processes
- Heavy Emphasis on Performance, Compliance, & Quality, but no proper business or commands/controls in place to monitor
- Increased Financial Terms & Risks
- Global competition for targeted markets and channels
- Customer Retention
- Staffing Requirements
- Industry Consolidation
- Product Competition and Performance and Sales Channel Success
Depending on the business, other challenges may also be faced.
As you can see, these challenges can put a great amount of stress on any business, regardless of size and current market strength. And yes, while many of these are part of the business process and some may not be only related to contracts – they ALL can be reduced and mitigated with the proper contract management system in place. Please keep in mind most businesses use contracts to obligate both parties to enforce and reduce these potential problems. If the business can’t track or manage these, however; they don’t realize and can’t enforce any of the terms.
The best way to experience the powerful features is to setup a free contract software demo. Contract Logix can help you explore the entire contract management process so that you can take control of the contract process to reduce costs and improve risk management. Full-featured analytical tools represent new levels of visibility into sales, value, trends, and historical performance, and if you need it in an Excel spreadsheet, that functionality is part of our standard package.