7 Benefits of Contract Management Software
Contract management is an essential part of any sales organization, yet many enterprises continue to operate with outdated, cumbersome paper-based contract management. Particularly with the emergence of SaaS contract management, the time has come for all enterprises to automate the vital process of contract management within the sales channel. The following seven benefits all make the ROI case for the move.
1. Shortened sales cycles lead to higher closing rates and increased revenue.
Enterprise contract management software allows deals to be closed within minutes after negotiation is complete- as compared to days, or even weeks, for traditional paper-based contract management. This capability allows for faster customer provisioning, which results in faster realization of revenue. It also prevents deals from falling apart while the paper trail lags behind agreement.
2. E-Signature capability raises customer satisfaction and improves internal efficiency.
E-signature capability, which is typically embedded within contract management software, has become standard since the passage of legislation in 2000 to provide for legal certainty and fraud protections. It’s now commonly understood that digital authentication is more secure than a traditional pen-and-paper signature, and customers have come to expect it. It’s convenient and reliable – and that pleases customers.
Internal “customers” also welcome e-signatures for the same reasons – speed, convenience, and security. E-signatures make everyone’s job easier.
3. Sales efforts can be focused on selling rather than contract administration.
E-signatures, contract authoring templates, instant contract approval routing, and other automated functions free up sales personnel to focus their talents on generating revenues. And this freedom from the hassle of paper-based administration will almost certainly increase sales team morale, and happy employees are generally more efficient with all their time.
4. Alerts are provided for milestone dates.
Contract management software can alert sales when contract milestone dates are approaching. These alerts can help sales avoid missed opportunities and plan customer contacts. The software can also automatically perform many of the actions necessitated by the milestones.
5. Contract data is consolidated and accurate.
By centralizing data in one location, enterprise contract management software eliminates the confusion and errors that often arise in paper-based contract management. All contract data is at the fingertips of permitted personnel – always up-to-date and complete. There’s no chance of working at cross-purposes due to outdated or insufficient information, and clerical mistakes are automatically flagged before they are entered into documents.
6. A balance between compliance and negotiating flexibility can be achieved.
In a blog about the tension between contract compliance and the ability for sales to customize contracts to win sales, Tim Cummins, the CEO of the International Association for Contract and Commercial Management, argues that enterprises shouldn’t have to settle for one extreme or the other. “Traditional thinking has us believe that we must create one process with one contract to obtain maximum efficiency, lower costs, etc., or alternatively that we must offer custom negotiation in order to be ‘responsive.’ In truth we should work on creating one option within a particular segment.”
With its use of contract authoring templates, contract management software facilitates this contract design for specific segments. And its library of pre-approved legal clauses and customizable safeguards to prevent violations of internal policy allow additional sales flexibility while preventing rogue actions that put the enterprise at risk.
7. Contract data is integrated with business intelligence.
Contract management software can be seamlessly tied into the business intelligence provided by other software (e.g., enterprise resource planning, customer relationship management). This integration permits companies to analyze their contract history to identify best practices, strategic opportunities, and problems to correct. The software helps evaluate the past to point the way forward.