8 Benefits of Using a Contract Management Software
Contracts are the foundation of a business. That is why we associate the general adoption of Contract Lifecycle Management (CLM) software across the world to factors like the rising demand for agile contract management solutions, increasing changes in compliance, and increased complexity owing to the diversity in sales and licensing models.
According to this World Commerce and Contracting report, poor contractual practices cost businesses an average of 9% of revenues each year. Thankfully, technology has come to the rescue. For instance, a contract reminder software integrates Artificial Intelligence (AI) to allow businesses to automate contractual processes.
This is perhaps one reason experts project that the Global Contract Management Software (CMS) Market will grow from US$1.3B in 2018 to US$5.2B by 2027 because businesses need efficiency.
What Are The Benefits Of Using A Contract Management Software?
1. Hassle-free Usage
The most fundamental benefit of a good contract management software is how easy it is to implement. Usually, CLM software uses a central repository to help businesses control all their contract documents with clients, customers, partners, and employees on one platform.
2. Improved Contract Compliance
According to Forrester and Aberdeen, digitization of contract management improves compliance by 55%.
In today’s world, it is important to comply with legislation like GDPR and other contractual agreements. In 2018, the UK’s Information Commissioner’s Office fined British Airways £183 million for customers’ data breach. A contract management software gives businesses control of their contract processes and provides accountability from requests to approval and project delivery.
3. Financial Optimization
A contract management system helps to lower legal fees and eliminate renewing unwanted services. Enterprises that link their sourcing and contracting processes are more likely to keep a higher percentage of identified savings.
The Faculty, a procurement consultancy reports that commonly, less than 50% of negotiated savings are realized over the life cycle of a contract. Therefore, it is critical to reducing the time spent on reviewing and signing contractual documents by using a contract management system as this can significantly reduce costs.
4. Helps You Focus On What Matters
A good contract management software will notify you and send prompt contract reminders, or renewals so that you can focus on what matters most to your business.
5. CLM Simplifies Contract Processes
Contract management software gives you access to all your files from anywhere in the world, and on any device, as long as you have the internet. As stated at https://www.contracthound.com/contract-reminder-software/, this software will simplify most of the process, whether you’re checking contract dates or status, setting expiration dates, or want to see auto-renewal reminders. With CLM, you can edit a contractual document or create a new one at your fingertips.
6. Reliable Document Management
With efficient CMS, you don’t need to outsource document storage or take up your office square with filing cabinets.
Your team can scan paper documents so that all documentation relevant to the agreement is available from a central location. A CLM software makes it possible to import electronic contacts, allows you to keep track of all of your contacts from a single repository.
7. Notifications And Reminders
When you archive contractual agreements automatically upon expiration and use alert notifications based on your specified terms.
Contract renewal is part of the lowest hanging fruit for your company and yet a commonly missed opportunity. A CLM software allows you to configure alarms with default or custom settings as a recurrence.
8. Increases Operational Effectiveness
CMS offers a better data and analytics system that tracks critical milestones and provides automated alerts and tools that let users schedule notifications as needed. By eliminating manual processes and centralizing your document repository, you gain greater control and improve process and workflow efficiency.
Companies need to ensure that they are adequately managing their obligations and agreements by using the proper contract management tools to track and monitor contracts will influence your company positively, by making a difference in managing supplier relationships and overall operational effectiveness.
So, What’s Next?
According to this Aberdeen Research, Automation cut contracting cycles in half, and the sooner you sign contracts, the sooner parties move to deliver expected benefits or review the next contract for approval.
As a business, you need a system that organizes your contractual agreements that will merge your workflow for greater efficiency, better performance.
Contract Hound is a leading software designed to turn the contract management life cycle into an easy, seamless process that effortlessly enables businesses to get the very best out of their contracts with a vast variety of tools and systems that are constantly updated.
CMS allows you to complete your contracts quicker, be more accurate, and have fewer risks and potential problems.
JR Dominguez is the technology, finance and music editor for MiLLENNiAL. When he's not writing, you can find him day-trading stocks, playing video games, or composing commercial scores.