Contract management has come a long way. At one time, it was common for no records to be kept at all. Today, organizations are under increasing pressure to make their contract management processes more efficient and effective. With increased attention on compliance including the development of new legal requirements contract management is becoming a key driver of enterprise success.
There are many ways to improve contract management, and companies need to consider their needs and circumstances and create a strategy that fits them best. Here we provide the top trends in contract management that are changing the functioning of contract management:
The Cloud Is the New Way to Manage Contracts
In the past, companies relied on paper documents and on-premises solutions for contract management. That approach slows things down—paper is cumbersome to distribute and find, and it becomes outdated quickly. This problem is compounded when the organization needs to manage many distant or remote locations, where employees can’t easily go through stacks of files and often don’t even have an assigned desk.
Managing contracts digitally helps make them accessible and provides a way to easily track their progress and changes. The cloud makes it possible for employees to work with the latest versions of all documents, wherever they are and whatever device they use. And because its central location is secure and meets regulatory standards, companies can be sure that key information is always available to the right users.
The Move Toward Mobile Collaboration Is Accelerating
The rapid growth of smartphones and tablets has put mobile collaboration into the hands of many employees—not just executives and managers, but regular employees across departments. That’s what they want too: Employees are twice as likely now to access company information on their devices as they are on their company-issued ones.
This shift has had a major impact on contract management. It means that employees have more opportunities to work with contracts, whether it’s by carrying them around for reference or signing them on the go. They can also store all relevant information in one place—allowing them to easily comply with regulations.
Use of Apps Is on the Rise
Contract management apps are designed to help organizations manage both simple and complex contracts, with advanced capabilities for managing change orders, service-level agreements (SLAs), warranty agreements, and more. The best apps are easy to use on any mobile device or web browser.
They offer real-time access to the latest contracts, as well as tools that support collaboration. Many apps integrate with popular business applications, which means data flows seamlessly between them and helps save time and reduce errors.
Proactive Compliance Is a Differentiator for Contract Managers
In addition to providing excellent customer service, contract managers must ensure compliance with all applicable laws and regulations. Today, IT certification is increasingly important to organizations that want to prove their compliance efforts are up-to-date and effective. This means that contract managers must be well-versed in the guidelines specified by governing bodies.
Emphasis on Process Improvement Is Growing
Contract managers are realizing they can streamline their processes while also providing better service if they follow best practices around change management. One of the most common ways companies do this is through an approval matrix, which is simply a list of the types of changes that require formal approval and who needs to sign off on them. By designating which people or business units must approve specific change requests, you can reduce the number of required approval signatures—and ensure better compliance with regulations—without compromising customer service.
Cloud-Based Contracts Are Becoming More Popular
Many contract managers are turning to cloud-based contracts because they make it easier for users to find, download, and view documents without having to go through an administrator or IT department. This is especially helpful as more employees rely on mobile devices as well as web browsers for access—making it simpler for them to work with their contracts from any location at any time. Contract management software also helps companies automate many contract processes to reduce errors and make collaboration easier.
Regulatory Compliance Is a Bigger Priority Than Ever
Contract managers who want to excel must stay on top of the latest compliance-related news and updates because it affects everything they do. To keep up, join industry groups like HIMSS, HIMSS Analytics, and the Enterprise Strategy Group (ESG).
Preventing Ransomware Attacks Is Number One
For many organizations, ransomware is their number one priority. This means that contract managers must be able to quickly recognize what constitutes a threat and how it should be handled, which usually also involves managing the implementation of preventative measures like updating anti-virus software, security patches, and firewalls.
Proactive Communication Is Key for Contract Managers
Contract managers often act as liaisons between service providers and end-users. To ensure everyone stays informed about potential problems or unforeseen issues, proactive communication can be one of the best ways to deal with them before they become critical—and expensive—to remediate.
Vendor Management Is Top of Mind
Keeping track of all changes in vendor status requires coordination among various business units within an organization—especially if the change could impact future contract negotiations, renewals, or other critical business processes. Many organizations are therefore turning to contract management software to help companies stay compliant with vendor-related regulations and streamline their operations.
This is the future of digital contract management. These trends are doing more than just improving contract management procedures, they are transforming it into something new.
The need to adopt technology for efficient contract management practices existed before the pandemic, and it has only accelerated it. The hesitant moves toward digitizing CLM operations are long gone. In response to the lockdown, remote access to centralized CLM software was facilitated these are the ways of work-life we are accustomed to.
Modern contract management is being transformed from a routine process to a dimension of the business that creates immense value. Technological advancements and innovative offerings are enabling this transformation.