What was once used mainly for record keeping and legal auditing purposes, contract lifecycle management software (CLM) has evolved into the core enterprise-level business solution that it is today. Organizations seeking to minimize risk, reduce costs and maximize revenue are using CLM to streamline their contract management processes. According to Gartner, CLM has moved from a “nice to have” to a “need to have” business solution.
The days of paper contracts, signed in person and stored in a filing cabinet may soon be a thing of the past. As more organizations turn to contract management software, they are realizing the benefit of automating and storing supplier agreements, sales orders, procurement contracts, and legal contracts digitally. Consider the results of a recent study by the Aberdeen Group which evaluated best-in-class organizations and their contract management objectives:
- The top goals were improving supplier contract compliance and improving supplier contract efficiencies. For purchasing directors, the top objective is cost savings and increased transparency.
- Realized savings for best-in-class organizations are double that of all others, while the spend being managed is 81% higher.
- Time to get contracts approved is 45% less for best-in-class organizations.
- The key factor that differentiates best-in-class organizations from all others is they have visibility into all contracts across the organization for all categories to review performance and evaluate compliance.
- Best-in-class organizations use systems which provide monitoring and alerts for event triggers such as rebates, discounts, and renewals.
How best-in-class organizations realize these results is through effective contract management solutions, many of which are automated. According to the study, 56% of best-in-class companies have adopted automation, which not only provides automation of the contract process but provides data and analytics which can be leveraged to improve cost savings and system efficiencies.
Digital Procurement Contract Management
As part of their strategic sourcing systems, many organizations choose a Contract Management Software and e-Tender Management tool such as the one available from ProcurePort. As companies increasingly depend on automated systems to prevent inefficiencies, shorten time-to-market cycles, minimize risk, and ensure governmental and organizational compliance, CLM platforms have been implemented with great results.
An effective CLM software solution will ensure a secure internet-based procurement application that organizations can use to create, execute, manage and analyze their supplier contracts. This includes the entire cycle of a contract from initial requests for proposals from suppliers, timelines, performance assessment, payment dates, contract expiration and other details.
Contract management software has a number of benefits:
- Helps an organization increase cost savings and improve efficiencies.
- Assists in enforcement of internal compliance with an organization’s financial and operational policies.
- Reduces risk by ensuring contractual compliance.
- Streamlines the contract creation and negotiation process.
- Provides data and analytics for performance assessment.
- Alerts stakeholders of due dates and key events in the contract lifecycle.
Selecting a Contract Management Solution
Contracts are the foundation of every relationship an organization has internally with staff and externally with other parties. Contracts define the responsibilities that an organization is expected and legally obligated to fulfill and those that an organization expects to be fulfilled. Therefore, it’s crucial that you select the best contract management solution for your organization’s needs. There are a number of contract management software solutions on the market and some are better than others. Before choosing one for your organization, it is important that you know what to look for.
The typical organization has several active contracts at a time. Take the following factors into consideration when choosing the right contract management software. A best-in-class CLM will offer:
1) Support for all the types of contracts an organization has including procurement, sales, wages, and non-monetary contracts.
2) A central repository with management tools that make it easy to automate activities such as contract generation, approval, and signatures.
3) Integration with other software an organization is using such as accounting and procurement software.
4) Smooth integration with the organization’s IT systems.
5) Alerts, such as auto-notifications of key contract dates, that are given in real time. This will be very helpful in ensuring an organization sends out invoices, makes payments and sends out requests for proposals in a timely manner.
6) Advanced security features that ensure sensitive contract details are only accessed by those who have the authority to access them.
7) The ability to create a library of templates and clauses that are used most frequently. This would automate the creation of new contracts and eliminate the need to create new contracts from scratch.
8) Analysis features that would be able to detect major changes and discrepancies.
The ProcurePort Advantage
The ProcurePort Contract Management Software and e-Tender Management tool has all of these key features and more. Additional features include:
- A user-friendly wizard for drawing up contracts and e-Tenders.
- On-screen reports that can be exported for use in post-event analysis.
- Real-time collaboration with all those involved in creating or fulfilling certain roles and duties in a contract.
- A lockbox that keeps responses sealed until a specified date at which time audit features will be accessible.
ProcurePort is a global leader in providing e-Procurement solutions and services delivered on demand via the Cloud. In addition to our Contract Management Software, we provide industry leading technology including Reverse Auction Software and Spend Analysis Software, technology support, and procurement consulting services. Contact ProcurePort about our Contract Management Software to automate and secure your contract creation, renewal, termination and analysis processes. Let us show you how our software can save your organization time and money and help ensure contract compliance.