Smart contract management – your top three advantages

11 November 2019

Within every company there exists a whole host of different contracts – purchase contracts, service contracts, as well as framework agreements with suppliers and customers, each stipulating specific terms, deadlines, extension modalities, and termination options.

Rather than being centrally managed in one place, these contracts are typically scattered throughout several different departments, whether it’s the purchasing department, the legal department, or any number of other departments. Without software support, keeping track of the bigger picture is virtually impossible. The consequence: missed deadlines, unnecessary contract extensions and the associated costs, incomplete documentation, or even legal complications.

The solution: digital contract management software

In principle, contract management encompasses every step – from drawing up and negotiating the contract, processing and administration, controlling and, where applicable, all the steps required for contract updating and revision-secure archiving. Smart contract management in the cloud makes organising and controlling contracts throughout their entire lifecycle simple and efficient.

Advantage #1 - All information and deadlines at a glance

Digital contract management solutions provide a speedy and transparent overview of all the contracts a company has in place, as well as the key contractual data. Metadata has an essential part to play in this context. The metadata describes the contract that has been filed and adds user-defined information, such as the contract terms. Automatically embedding centrally configured metadata into a contract will minimise the number of manual steps and eliminate sources of error.

In many cases, failure to terminate a contract before the prescribed deadline automatically prolongs the contract and generates needless costs. With a cloud-based contract management solution, reminders for adherence to dates and deadlines are sent automatically. All of the parties involved receive a reminder of their contractually agreed obligations and, as a result, you will never overlook another deadline.

Advantage #2 - Sensitive information is securely protected

Contracts frequently contain confidential and sensitive information that is only intended for a restricted group of people. With smart contract management, role-specific access rights clearly regulate who has access to which contracts and who is allowed to edit them. Through version control, each change can be tracked in a way that is revision-secure. This means that smart solutions for contract lifecycle management are a critical cornerstone of revision-secure contract archiving and versioning. They deliver the highest level of security for legal matters, satisfy requirements for compliance, and minimise business risk exposure for companies of all sizes and in all industries.

Advantage #3 - Greater efficiency through smart processes

Digitalising contracts and the corresponding business processes makes contract management, including all associated documents, significantly more straightforward. Using the graphic process editor, you can customise and adapt the required processes without any prior programming skills, so that contract deliverables, their deadlines, and the compliance requirements can be handled seamlessly. Decisions, approval procedures, and work processes are all performed digitally through automated workflows that boost productivity, reduce paper consumption, and minimise the need to contend with cumbersome Excel lists and e-mail communications. As a result, all relevant internal departments as well as external contract parties or legal advisors can be involved before the start of the actual contract period and throughout its entire duration.

The bottom line

Smart contract management guarantees a number of advantages. It greatly simplifies contract handling and creates more transparency, faster processing, and more effective cooperation among all parties involved. In the age of Industry 4.0, companies would be well advised to make sure that the potential for increased effectiveness and efficiency resulting from systematic digitalisation of contracts and their accompanying company-wide processes is not left untapped.

My team and I would be happy to give you an online demonstration so that you can see exactly how Fabasoft Contract Management can help you generate added value for your company.

 

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