What is Contract Management Software

Helping in-house counsels to provide legal service

Written by Knowledge Team, posted on March 02, 2019.

Solution and process to automate the contract lifecycle management to bring governance, reducing risk and being compliant. Navigate the contracts from creation, approval, storage and renewal

What is Contract Management

Contracts play a vital role in the daily operation and can inole any departments in an organization. Contracts are an essential part of running a business for implementing agreements involving external parties.
Contract management is the approach of creating, storing, organizing, searching and retrieving. The approach can be supported by legal technology to includes the process of creating contracts by business users, determining the terms of the agreement, contract negotiations, execution and renewals.
Implementing a contract management system is a must for an organization to experience increased productivity, improved visibility and to maintain total control of contracts and to keep track of its obligations to clients, vendors and service providers.
Contract Management is not an in-house imitative and must be organization value proposition for improving efficiency by implementing SOP supported by software. General counsels will own the contract lifecycle management.

Problems with manual Contract Management

  • Time consuming
  • Excessive paper usage
  • Misplacement of contracts
  • Heaps of paper to search through
  • Monitoring becomes difficult
  • Slower outcomes and less accurate
  • Improper management of contracts
  • Lack of client satisfaction

Why Contract Management Software

Handling high volumes of contracts by company general counsel may lead to bottle neck as all the legal requests and even standard contracts must wait for in-house lawyer approvals, not be the best use of business users time and organization resources. Moreover, it could lead to errors and omissions that will have negative consequences for the business. Contract management software on least must organize the contracts by departments, value, type in one place, for quick and easy referral, anywhere and anytime.

Implementing a Contract Management Software

By implementing a contract management software, organizations and in-house counsels can ensure that the contracts are enforceable and accurately reflect the agreement between the parties. Implementation primarily involves a 3 step process.
  • Drafting Contracts
    Preparation of standard templates, finding out the variables related to each contract, and developing a checklist of clauses that could be required to draft a contract. The contract management software takes full control over the quality of the draft.
    Contract automation allows business managers to assemble contracts with no legal knowledge. Clauses, precedents and conditions will be inserted based on interview type questionnaires users answer. Standard contracts (NDA) can be created without involving legal department and can be taken to execution saving time
  • Reviewing Contracts
    This step involves analyzing the drafted contracts and reviewing to identify if the contract adheres to the rules and contains the relevant clauses needed for the template and if it is in the best of firm’s interest.
  • Managing Contracts
    This involves maintaining a complete database of all contracts and searching through as per the requirement. Users can quickly pull up associated contracts or documentation whenever needed. Contracts can be tagged by metadata like contract type, value, and department for easy searchability.
The Contract Management Software usually contains a variety of configurable tools to increase the speed of contract creations, allowing modification by authorized users to adjust and approve workflows, customizing notifications and alerts and to track risk and compliance across various contracts without the need for additional IT resources. Additionally, a good Contract Management Software can handle every aspect of the contract management process, including:
  • Clause library
  • Precedents
  • Critical dates tracking
  • Automatic email alerts and notification for renewals
  • Dashboard for viewing contract landscape and KPI tracking of approvals and negotiations

Benefits of Contract Management Software

  • All the contracts can be stored in a central repository using the software and hence it’s easy to keep track of them.
  • Contract Management Software proves to be the most cost-effective solution for automating contract creations and managing the various stages of contract lifecycle.
  • Searching for a contract can be effective based on the optimized search options available with contract management software.
  • For not missing out on important dates, the software offers provisions for automated reminders in the form of pop-ups or e-mails.
  • Automated contract management software automate and manage from creation and execution, through performance monitoring, amendments, analysis and renewal.
  • The right Contract Management Software helps in-house legal teams work faster, smarter and more efficiently. All the contracts do not need general counsel (GC) approvals and CLM can be managed by GC based on contract types. GC can focus on non-standard and complex contracts
  • The software provides visibility and insight to better manage risk and ensure compliance.
  • Reconciliation, negotiation and approving contracts can happen in record time.
  • Contract Management Software reduces significant chances of financial and legal risk.

The Bottom Line

Every organization can get flooded with contracts anytime. Handling those contracts and maintaining their databases needs an effective, accurate and reliable contract management solution. PageLightPrime Contract Management Software is designed uniquely as an effective Contract Lifecycle Management software for small, medium and large organizations with various levels of contract dealings every day and managing the contracts in a systematic way. PageLightPrime CM is built on Office 365 and is integrated with Practice Management Software.
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