What is a Contract Management Repository?
Your contract lifecycle management (CLM) is an integral business process that touches on almost every element of your operations. A contract management repository refers to the means and methods you use to store, organize, and access your contracts.
The World Commerce and Contracting reports that poor contract management practices, on average, costs businesses 9.2% in revenues. How you store, organize, and access all your business agreements and supporting documents will significantly impact the performance of your contracts and contracting processes including your ability to effectively mitigate risk, ensure compliance, reduce costs, increase efficiency, and manage obligations.
If you are still using physical storage as your contract management repository, you’re losing access to vital business information that can help you optimize your CLM. In this glossary article, we’ll discuss everything you need to know about a contract management repository and how you can benefit from modernizing your CLM.
- A contract management repository is the means and methods you use to store, organize, and access all your contracts and documents related to your business agreements
- A physical storage solution creates many challenges and reduces the efficiency of your CLM
- Modern, digital, and cloud-based contract repositories make it easy to standardize your contracting processes, access vital business information, ensure security, and speed up the contracting lifecycle
What Exactly is a Contract Management Repository?
With the advance of dedicated contract management software, the term contract management repository is becoming more widely accepted in the industry. It refers to where and how you store, organize, and access all your contracts and documents in support of your broader CLM strategy.
The term contract management repository was often used interchangeably with a document repository. As most contracts were documents, many organizations made no distinction between a contract or document repository. However, in today’s age of digital transformation, document-centric contract management is not effective. Organizations much take a data-driven approach to contract repositories and contract management as a whole.
How Do You Use a Contract Management Repository?
Contracts remain a foundational element of all your business relationships and contain vital data about your organization’s performance and relationships with other entities. The way you store, organize, and access your contract data depends on your CLM solution, and as the drive for digitalization of the contract management discipline opens up, new opportunities to uncover value from your contract data.
Physical documents (or document-centric) contract management is no longer the ideal way to manage your business agreements. A data-centric contract management approach makes your contract repository a source of valuable information that you can leverage to make data-driven decisions about your business and business relationships. With a digital system, you can search for specific data fields and track all your contract-related information from a single source of truth.
What are the Effects of a Poorly Designed Contract Repository?
The design or architecture of your contract repository will determine the efficiency of your contracting model. With so many agreements to keep track of, using a poorly designed contract repository such as one that is document-centric leads to multiple issues when trying to analyze your business performance.
Some of the main challenges from using a contract management repository that is not truly data-driven, include:
- Inaccessible data – Storing contracts physically, offline, or in siloed and document-centric systems makes it almost impossible to access vital business data promptly and accurately.
- Lack of security – Contracts contain sensitive information. If your contract repository doesn’t provide robust permission and authentication settings as well as encryption and security certifications then your that exposes your to unnecessary risk.
- Missed obligations – If your contract repository can’t capture or understand the data in your contracts such as dates, terms, milestones, and other items then you can’t leverage that data to keep track with obligations.
- Lack of version history – Different versions of contracts may end up in different locations, creating a lack of visibility into the version history and amendments made to an agreement. In some cases, without a proper digital repository contracts can actually get lost or deleted.
- Difficulty in tracking KPIs – Not having easy access to contract data makes it impossible to leverage that data to benchmark and track contract management KPIs and limits your ability to gain the required oversight of your business performance
- Increased cost of compliance – The costs associated with passing a compliance audit will increase if information exists in multiple offline, physical, or siloed storage locations
How a Digital Contract Repository Improves CLM and Business Efficiency
Contract management software with a centralized, cloud-based, and data-driven digital contract repository allows your organization to speed up your CLM and interrogate current and historic data for improved decision-making. A cloud-based CLM solution provides you with all the tools you need to speed up your digital transformation, increase cross-functional collaboration, boost security and compliance, and monitor business performance from a central location.
With a cloud-based CLM repository, you gain:
- A single source of truth – A centralized contract management repository allows all your stakeholders and legal resources to access accurate information about your business relationships including supporting documents, correspondence, and reviews. You can also integrate it with other business applications such as CRM or ERP.
- Access to contractual data – Contracts contain a wealth of data. A digital contract repository makes it possible to search, report on, and analyze your contract data for insights that help improve your business decision-making. You can leverage that data to build KPIs and dashboards to optimize key CLM functions.
- Reduced administration costs – A data-driven contract repository makes accessing all of your contract information very quick and easy. You can search and filter by any relationship such as contract, document, contact, organization, and more. This makes tracking down answers to contract-related questions fast and even self-service in nature for non-Legal resources.
- Robust security – A digital contract repository such as Contract Logix’s provides a security-first approach to storing, accessing, and organizing your contracts. You can enable role-based and feature-based permissions, customize authentication settings so they align with IT requirements, it encrypts all data, and also provides support for SSO, MFA, and SOC 2 Type II security compliance.
- Faster audit response – With a single source of truth, you can respond to any audit request quickly and provide a detailed history for each agreement. You will never worry about which agreement is the latest and all supporting documents for an agreement such as a COI, SOW, or BAA are at your fingertips.
What Should You Look for In Your Digital Contract Repository?
When evaluating a digital contract repository and contract management software system, you should look for a flexible solution that you can adapt according to your CLM model. By adopting a digital and data-driven solution like Contract Logix, you can start harnessing your contract data for improved business operations.
The main features you need to look for are:
- Role-based and Feature access controls and authentication – Granular permissions allow you to only share information with authorized resources and keep your sensitive data secure
- Automated workflow engine – Different types of agreements will require specific workflows to speed up the contract drafting, negotiation, and approval processes as wel as to send alerts and notifications and generate a complete audit trail of each change to an agreement
- Analytics and KPIs – To leverage your contract information for improved decision-making, the solution should provide you with performance-related dashboards and reports
- Integrations – Connecting your CLM with other lines of business (LOB) applications like your CRM or ERP systems allow you to automate tasks and unify customer data between different departments
- Collaboration tools – Your CLM should streamline all communications between stakeholders and make it easy to review, comment, edit, approve, and digitally sign contracts for both internal teams and external third parties
- Data-centric – In order to avoid the pitfalls of document-centric or shared folder organization methods, your CLM should be data-centric in how it stores your contracts. This way, you can search, filter, and report on them by any relationship you want and not be restricted in any way.
Optimizing Your CLM with a Digital Contract Repository from Contract Logix
Contract Logix provides you with a cloud-enabled CLM solution that gives you access to key contractual data from any device. You can configure the system to support all your contractual processes, including document intake, third-party collaboration, and detailed audit history for each agreement. With Contract Logix, you can start leveraging your vital business information from a digital contract repository today.
For more information about our cloud-enabled CLM solution with a digital contract repository, request a demo from Contract Logix.