What is contract management software, and how does it work?
management software-The processes necessary for contract lifecycle management (“CLM”) are digitised using contract management software. Legal and procurement teams can establish and manage contracts more efficiently and securely using digital contract management tools than they can with old, manual techniques.
Lawyers used to have to print each draught of a contract and go through each line by hand. They put in tens of thousands of hours and created reams of paper containing sensitive information, which were stored in heaps and binders throughout the glass-encased buildings.
Billable tenths of hours evolved into dozens and hundreds of hours spent repeating the same actions in the old method. Legal teams struggled to come up with more efficient workflows due to the lack of time they had to accomplish anything other than manually copy, paste, and type new commercial agreements into existence. Within an organisation, there could be as many alternative ways to construct contracts as there are lawyers.
Many young lawyers have spent sleepless nights asking why there isn’t a better way to do things.
A better option is to use digital contracting.
Automation and user-friendly solutions help lawyers and business teams to get more done, get it done faster, and worry less about setbacks like data breaches and missed deadlines, thanks to increased productivity and enhanced security. There’s no need to hunt out files scattered over multiple workstations and hard drives, attempting to figure out which version is the most recent. No matter where the parties are situated or how many modifications a draught has undergone, a cloud-based contract management tool keeps all parties on the same page and all documents secure and up to date.
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What is the significance of contract management software?
From establishing templates and early draughts to tracking renewal deadlines on executed contracts, good software can help you optimise workflows and organise files across the contract lifecycle management process. Here are some of the ways a CLM platform can make your life easier both before and after signing.
Contract drafting and pre-signature
Contract drafting, management, and review can all be done faster with automated workflows. For instance, we’ve previously discussed how contract intelligence may help with due diligence in the lead up to mergers, acquisitions, and other corporate transactions.
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One advantage of a cloud-based CLM solution is the reduction in travel costs associated with unnecessary in-person meetings and packed deal rooms where individuals would spend hours studying paperwork. Printing and labour are two other areas where you might save money. There’s no need to print numerous draughts of a 100-page contract or have junior associates and paralegals spend dozens of hours crafting typical provisions from scratch or splicing them together from other contracts. It’s simple to compare multiple versions of specific phrases and suggest adjustments or additions using the software.
Streamline and align workflows so you can concentrate on what matters most.
If your company doesn’t have centralised contracting processes in place, teams from various business units are likely to have adopted a variety of proprietary “” and competing “” contracting methods. It’s critical to standardise how your teams get work done so you can focus on substance rather than fussing over processes, especially as hybrid work arrangements become more common. By creating a central workspace and fostering a standard contract workflow, a cloud-based CLM platform fosters cooperation.
Drag-and-drop tools and templates make contract creation more easier, allowing lawyers and business managers to concentrate on key business and legal issues rather than the tedious effort of crafting boilerplate text. User-friendly features like saveable custom searches cut down on tedious work while also reducing the requirement for intensive training.
A good contract management platform will also make approval processes easier by providing automated notifications and a safe, central spot to store, review, and execute all documents.
Boost your security.
Stacks of paper on desks and shelves pose a security risk in the office. People who aren’t participating in the transaction might notice something they shouldn’t. Conversely, if your critical documents are safely stored online, it becomes more difficult for an unauthorised person to access them.
Only the person who is supposed to see a document can see it, thanks to rule-based access that uses industry standard features like two-factor authentication. Each team in the organisation should be able to customise their usage of the platform such that only the appropriate roles, individuals, and equivalents from other teams or organisations have access to any particular document.
Secure e-signatures save time.
Hand-signing documents is inconvenient. You must print all of the necessary papers, deliver them to the signature’s physical location, wait for the signatory to sign, wait for the ink to dry, scan the sheets, and then send the scanned file to the other party. Have you missed a page? Just for that one page, you must repeat the process. Is the designated signatory unavailable today? Return to the file, make a modification to the name on the signature page, print it again, and so on.
Why are you torturing yourself like this?
E-signatures are legally legitimate and binding in the same way as “wet” signatures are. Integrated e-signatures combine the convenience of signing with a mouse click or a tap of a finger with the enhanced security of features like two-factor authentication. There’ll never be a need to print or mail a signing document again.
Contract management after the signature
A CLM platform can also help with contract management once all parties have signed the agreement.
Every year, businesses execute thousands of contracts with customers and business partners. When you’re dealing with that much volume, you’ll need a dependable contract management platform. Key dates, such as contract renewal deadlines, are far too crucial to be left to manual tracking in a locally stored Excel spreadsheet.
After you’ve (e-)signed on the dotted line, contract management software can help you in a number of ways.
Storage, management, and access should all be made easier.
When you’re just starting out with contract automation, smart contract management software will quickly import your existing contracts from all of the areas where you now save them “” from cloud-based storage solutions to Salesforce to your email inbox. You’ll never lose track of individual files again once all of your documents are in one safe, central location.
It’s as simple as pressing a button to organise your documents. A well-designed CLM platform will allow you to easily tag a bunch of documents or move them into a folder together once you’ve conducted a search.
A good piece of software will also allow you to save the search results. If you need to hunt for the same collection of data points on a regular basis, you can go back to the saved search and run it with just one click anytime you need to. Other useful aspects of a good contract management solution include automatically linking parent and child papers so you can always see relevant documents in their right context without having to do additional searches.
It’s not a problem if you don’t want to keep all of your contracts in one spot. A solid CLM platform will be able to access your documents wherever you keep them and will immediately update the stored files with any changes you make within the CLM’s user interface. It should also give a single point of access to all of the relevant data contained in those contracts, regardless of where they are stored.
In addition to facilitating collaboration, the centralised storage location allows for the construction of a trustworthy audit trail. When everything is conveniently available in one spot, you won’t have to waste time looking for documents or draughts.
