Empower Sales Staff with Contract Management Software
In many enterprises, contract management automation is still seen primarily as cost containment. That thinking underestimates the potential of contract management software to also increase revenue by providing critical assistance to sales.
Poor contract management leads to revenue leakage of 5% to 9%, according to a recent article, Why the Fortune 500 Automate the Sales Contract Process on SellingPower.com.
“From longer negotiations at the front end to missed renewal opportunities post sale, lack of an automated system lengthens the sales cycle, erodes customer relationships, and leads to that significant revenue leakage,” the article concludes.
Attentive sales organizations are recognizing this problem and acting to correct it. “Enterprise sales leaders are taking a second look at their contract management process in an effort to speed up sales cycles and boost productivity among sales reps,” according to SellingPower.
Automation of the contract management process is essential in this effort to improve sales efficiency, helping sales reps do their job better in numerous ways.
Enterprise contract management software can improve customer satisfaction by allowing sales reps to immediately respond to any customer queries. There’s no need to make the customer wait as paper contracts are hunted down.
Contract management software can also provide alerts about renewals, deliverables due, and other milestone dates so that the sales team and customers are always in sync. Customers appreciate this; they like being able to leave the management of the contract to the vendor.
But vendors can’t expect to effectively manage the contracting process and the necessary customer communication if they’re still using manual, paper-based systems. Without automation, keeping customers informed can easily become a haphazard effort — and even with the best of management, human error is still likely without the support of automation. It almost always takes automation to maintain the necessary level of consistency to please customers.
Enterprise contract management software speeds the time it takes for contracts to be created and approved. This efficiency is achieved with contract authoring tools (e.g., pre-approved templates and clauses), as well as with contract routing features that automatically send contracts to the appropriate people for review and approval. Automation can also streamline the approval process, allowing contracts without exceptions to be automatically approved.
This faster process is another of the ways in which contract management automation helps customer service, but it has yet another key benefit — it improves sales closing rates. If a contract takes too long to formulate or bogs down in the approval process, numerous events can happen that cause the deal to fall through. Automated contract management enables contracts to be closed as soon as absolutely possible, sealing deals before they have a chance to go sour.
As the SellingPoint article alluded to, contract management is vital for sales success at all stages of a contract’s life — even after sales are made. Contract management software provides an enterprise with an ongoing stream of real-time data on contract performance, allowing sales to make immediate adjustments to their sales tactics and strategies.
This data is also crucial in analyzing sales operations and identifying improvement opportunities. The easy access to data afforded by contract management software enables in-depth scrutiny of previous negotiations and contract terms, and this historical contract data helps pinpoint correctible inefficiencies and strategic misjudgments, as well as reveals possible solutions.
In both the short-term and long-term, automation of contract management is an indispensable element of any effort to improve sales efficiency — not only by controlling costs but also by boosting sales revenue.