Effective contract management calls for a high level of commitment, expertise, and accuracy on the part of the in-house staff and external stakeholders involved – but more than anything else, it demands a great deal of time. In the past, analog tools have been used to manage agreements, but manually performed activities and system integration gaps render them labor-intensive and error prone. Coping with the burgeoning number of agreements and their increasing complexity calls for digital tools that ensure sustainable, resource-efficient contract management by automating processes wherever possible.
Greater efficiency thanks to automation across the entire contract lifecycle
1. Digitalize all your contracts with ease
Company mergers, changing responsibilities, habit – there are a number of reasons why the corporate contract portfolio is often spread out in location-based file storage systems, team drives, and paper files buried in the cabinets of various departments. And yet when urgent questions about specific agreements or the portfolio arise, all the information needs to be available in one place so that answers can be found quickly.
Modern software makes digitalizing your scanned contracts as easy as drag and drop. Thanks to AI-based contract analytics, it then extracts relevant details such as the contract type, contract partner, and contract terms automatically and compiles them in structured lists. All the authorized persons can access the data and documents, which are stored in digital files and can be located and edited quickly just by entering keywords. These features are also extremely helpful when it comes to concluding new contracts or adapting existing ones.
2. Approved templates and text modules for contract drafting and amendments
Drafting and amending agreements are tasks that recur frequently. In these processes, the people involved are in charge of several corporate divisions, and are faced with the added challenge of ensuring that the contracts are drafted correctly in accordance with the applicable legal basis and situation, and that the most up-to-date version of the document is the one in use at any given time. When done manually, this involves significant effort and potential for error.
With a smart contract management tool, the responsible personnel can access template collections and templates that have been reviewed and approved by the legal department right from the contract drafting stage. The centrally stored metadata is transferred directly from the digital files to the document templates by means of text modules and clause libraries. Using the templates, which are always adapted to the legal situation, leads to a significant increase in efficiency and quality. These advantages also benefit the stakeholders during contract negotiations.
3. Native review, authorization, and signature workflows with digital signatures
New and amended agreements are subject to the consent of the contracting parties. Instead of exchanging data unreliably during endless rounds of back-and-forth correspondence, digital contract management starts the integrated review, approval, and authorization processes automatically. Users can also initiate ad-hoc workflows, select multiple contracts from the contract list for processing, or use rules to select and process them all at once. Based on the settings, the relevant people can view their to-dos summarized in a worklist and also receive e-mail or push notifications. That ensures speed, revision security, and maximum transparency regarding a document’s version and status, both during the negotiation phase and over the entire lifecycle of the contract.
What’s more, native advanced electronic signature capabilities in line with the EU’s eIDAS Regulation are now among the basic features of today’s applications. The signature process, which is also initiated automatically, proceeds without changing systems or involving third-party providers, speeding up the process substantially. The signatories simply fill in the signature field and the agreements become legally valid. This pace is maintained throughout contract execution.
4. Integrated deadline management
Deadlines and time limits are considered essential components of a contract, just as compliance with them is regarded as a prerequisite for greater competitive advantage. In many cases, several people – often scattered across departments and locations – enter this data manually in lists that have grown over many years, making calendar entries, and coordinating them by e-mail or telephone.
Making the switch from analog to digital tools will help eliminate these time-consuming and, more importantly, error-prone activities to the greatest possible extent. For one, the lists – arranged according to contract end date – provide crucial support when it comes to meeting deadlines. Secondly, the integrated calendar that is linked to Microsoft Outlook, complete with deadline management, e-mail reminders and push notifications, is a powerful feature. Thanks to automated deadline management, missed deadlines and the resulting additional expenses arising from contract non-compliance are history.
5. Dynamic reporting at the push of a button
Having a thorough overview of your existing agreements is imperative for pinpointing opportunities and weaknesses in contract management, such as obsolete or risky clauses, and deriving future courses of action. Intelligent systems deliver this.
Automatically created dashboards display all the contract details. The ability to customize them, combined with advanced sorting, filtering, and analysis capabilities, means that you can respond to ad-hoc queries and generate dynamic reports in a matter of seconds. It also means that you can visualize parameters such as totals, addresses, and key figures in a whole array of different chart types and tables at the touch of a button – and share them with your supervisors, team members, and business partners. And that makes it a whole lot easier to detect deviations between target and actual values, identify risks, and manage workflows reliably.
Effective contract management depends on automated processes – for the entire lifecycle of the contract
Contracts have a direct impact on a company’s commercial success, irrespective of industry, company size, and number. Accordingly, contract management demands efficiency and flexibility – in addition to diligence and quality. That’s where conventional methods hit their limits.
Smart digital off-the-shelf products like Fabasoft Contracts combine these seemingly contradictory features by providing rapid implementation and a high degree of automation. All of the people involved from the various departments and organizations can maintain a clear overview, take swift action whenever necessary, and set the course for sustainably effective contract management, even as the number and the complexity of the agreements rise. That saves valuable time that can be channeled into other critical, profit-generating activities. A lot of time.