The field of contract management has been witnessing a paradigm shift, thanks to the advent of Contract Lifecycle Management (CLM) software. This next-generation tool is redefining how businesses handle their contracts, making the process more efficient, transparent, and cost-effective.
Unveiling Contract Lifecycle Management: The New Age Solution
Contract Lifecycle Management, or CLM, is a software-based solution designed to streamline and automate all stages of contract management. It aids in the creation, negotiation, execution, and renewal of contracts, handling everything from client agreements to supplier contracts, employing contracts, and corporate agreements.
For long, legal departments were sidelined when it came to leveraging technology, but with the arrival of cloud-based CLM solutions, the tables have turned. Digital contracting is now the way forward for legal teams, who can do more with less, focusing on crucial business issues rather than getting bogged down with repetitive work.
The Power of Cloud CLM: Top Ten Benefits
Switching to a cloud-based CLM platform brings an array of benefits to businesses. Here’s a rundown of the top ten advantages that can revolutionize your contract handling:
1. Empowerment through Self-service
A cloud CLM enables anyone in your organization to generate transaction-ready contracts from pre-approved templates and clauses in a few clicks. This becomes an invaluable asset when dealing with high-volume similar contracts like NDAs or employment agreements.
2. Centralized Template and Clause Libraries
Your legal team can manage all templates and pre-approved alternative clauses in one place, with a complete history of changes. Moreover, it allows you to implement a formal approval and publication process, ensuring that all changes are appropriately approved, and only the latest approved version is available for use.
3. Real-time Collaboration
A cloud CLM enhances collaboration between your legal and sales teams on a contract, reducing the review and redline cycle and speeding up contract turnaround.
4. Version Control and Comparison
During contract negotiations, numerous versions are exchanged. A cloud CLM lets you store each version and easily compare any two, eliminating worries about working on the correct version or any confusion about the original proposition on a clause.
5. Protection of Emails and Attachments
To truly safeguard your company, you need more than just the contract document. You also need to save all emails and attachments exchanged during the negotiation. A cloud CLM integrates with your email provider for seamless import of emails and attachments, linking them to the correct contract or client/supplier for safekeeping.
6. Automated Approvals
A cloud CLM can significantly reduce compliance risk by automating your contract approval process. This ensures that no contracts go out for signature without proper approval, from a simple NDA to a complex MSA.
7. Integration with E-signature tools
A robust cloud CLM integrates with leading e-signature tools, enabling you to send contracts for e-signature, track their status, and ensure they are stored correctly.
8. Central Contract Repository
Setting up a secured central contract repository is the first step to proper contract management.
9. Post-signature Contract Management
A cloud CLM allows for setting up alerts and email reminders to never miss a renewal date, payment date, or any other crucial event.
10. Analytics and Reporting
With customizable dashboards and reports, a cloud CLM gives you a holistic view of all your active contracts, making reporting to executives or auditors effortless and allowing your legal team to focus on their core tasks.
While some cloud CLM solutions primarily focus on the post-signature phase, others assist you at every stage. However, the best cloud CLM solutions should offer a range of options to meet your immediate needs and evolve with your business processes.
AODocs, with its cutting-edge technology, offers everything from a simple, smart cloud contract repository to a full cloud CLM solution that can adapt to your needs and grow with your business.
Beyond the Basics: The Extended Benefits of Contract Lifecycle Management
Contract Lifecycle Management goes beyond the basic contract renewal and project parameter establishment. It ensures that your business remains compliant and minimizes risks from financial and legal perspectives. Not only does it help organizations significantly reduce risks and stay compliant, but it also improves efficiency and cost savings.
1. Version Control
Contract negotiation often involves multiple parties, leading to multiple versions and rounds of revision. CLM enables you to track versions of a contract, ensuring you’re always working with the latest version and can review version history to see what changes were made.
2. Real-Time Collaboration
The traditional paper-based contract process can be time-consuming, with multiple parties needing to physically receive, review, approve, and forward documentation. CLM digitizes this process, facilitating real-time collaboration on documents, shortening the contract lifecycle.
3. Enhanced Security
Contracts often involve multiple attachments and files exchanged during their lifecycle, requiring adequate security measures. CLM provides secure storage and can automatically integrate with your email provider or use advanced technology like file sync, sharing, and electronic signature to securely deliver documents to the right recipients.
4. Accessible Templates
CLM aids in managing templated clauses and contract libraries, helping teams establish formal processes that speed up contract lifecycles. It ensures the most recent versions of templates are being used and emphasizes data collection as contract requests are created and workflows processed.
5. Advanced Analytics
CLM provides a global view of all active contracts, allowing for easy data extraction on contract status. Reporting dashboards provide real-time graphical interfaces, allowing users to drill down to the contract request, contract record, and contract document as needed.
6. Risk Avoidance
CLM aids in fulfilling contractual obligations, ensuring compliance, and avoiding litigation loopholes. It also helps in avoiding payment errors that could result in fees or penalties.
7. Automating Approvals
By automating the contract approval process, CLM reduces compliance risk irrespective of the complexity of the process or the number of teams involved.
To understand better how contract lifecycle management can boost your bottom line, reach out to All Star to learn more about this solution.
The Five Major Takeaways from Contract Lifecycle Management
Contract Lifecycle Management software is a game-changer for businesses, bringing about significant transformations with its multitude of benefits. Here are the top five takeaways:
1. Financial Savings
CLM software can reduce administrative costs by up to 30% by automating the contract management process. It also helps avoid fines and penalties for non-compliance with regulations, ensuring that your contracts are legally binding and enforceable in court if necessary.
2. Greater Efficiency
CLM software automates repetitive tasks and eliminates the need to manually search through files for paper contracts. This not only saves time but also provides greater visibility over the entire process.
3. Increased Visibility into Contracts
CLM software offers an online contract repository, providing a historical record of all changes made to the documents. It also allows the creation of custom reports to analyze any data you need.
4. Increased Contract Compliance
CLM software ensures that your organization is always compliant with the terms of its contracts, reducing legal risks and saving money. It also ensures that your company’s contracts get signed and approved by the right people at the right time.
5. More Control over Contracts
With CLM software, legal departments can manage and oversee contracts from start to finish, ensuring compliance with corporate policies, managing terms and conditions before they’re signed, tracking contract statuses, and keeping important documents safe and accessible only to those approved to see them.
Contract Lifecycle Management software is not just a tool; it’s a revolution that can transform businesses. If you haven’t already started exploring what CLM software can do for your company, now is the time. Get started today and witness the change!