Effective contract management is critical, especially for firms that handle a large number of contracts. You must have an efficient system to avoid delays or missing orders, which may result in customer dissatisfaction and additional costs. As a result, it’s critical to identify ways to streamline existing contract management processes so your company can deliver value to its customers more effectively.
However, creating strategies for optimizing contract management processes is challenging. Therefore, you must first thoroughly evaluate the system to find inefficiencies you need to address. Fortunately, there are readily available tools that can help you.
That being said, here are a few tips to help you streamline contract management:
- Use Process Automation
The first thing you should do is get contract management software that matches your requirements. Also, it’d be best if you went for the option with features allowing you to automate a large portion of the process.
Process automation is beneficial because machines or computers are typically better than people at doing repetitive jobs. As a result, there’ll be fewer mistakes and more time saved.
- Use E-Signatures
Businesses should consider incorporating e-signatures into their contract management procedures. It’s common for some documents to require signatures before proceeding to the next stage. Make sure that they’re done as quickly as possible. However, you have little control over how long it takes for someone to respond with a signed copy of the contract.
Therefore, gathering signatures may be a nightmare for firms that handle many contracts. Thankfully, this can be solved using e-signature tools from sites like jSign.com. They allow you to complete document signings much faster. It removes the back-and-forth discussions that frequently cause contracts to be prolonged.
Lastly, ensure to look for contract management software with an e-signature feature.
- Outsource Non-Essential Tasks
To streamline the contract management process, you must first identify the core and non-essential aspects. Let your managers handle your contract management process’s critical details, then outsource all the less critical and repetitive tasks.
Contract management is often a time-consuming task. You want your managers or executives to spend their time on things other than activities that you might easily outsource. For example, you shouldn’t delegate data collection to a manager if it takes at least five hours to complete. This consumes a significant amount of time they could’ve spent on more productive tasks.
Furthermore, you wind up paying more for a task that might be outsourced for much less. A better strategy would be to find a business specializing in data capture. Because they have the essential knowledge and skills, such a firm should be able to do the job more quickly.
- Delegate Often
If you want an efficient contract management process, you must avoid having an I-can-do-it-all attitude. If you’re starting and your company is still small, you might be able to get away with it. However, as your company grows, you may get overwhelmed. This is because every other aspect of your business, including contract management, will need more attention.’
As a result, you must practice delegation frequently. Refrain from overly centralizing control, which may lead to inefficiencies in business processes. So, don’t hesitate to delegate tasks to other employees. It could motivate them since it demonstrates that you believe in them.
- Use Templates
Contracts differ based on a lot of variables. The terms are often established based on your or the other party’s demands. As a result, there’s no one-size-fits-all model to contract formation. However, establishing templates based on specific contracts your organization needs or uses may be a good idea.
You may design templates for employment, sales, service, purchase, and other types of contracts, and make sure to include common corporate clauses. Having templates can be advantageous, especially if you need to produce a large number of contracts. Instead of writing each contract from scratch, you may utilize a template as a starting point to save time.
- Use Checklists
Employee onboarding is never an easy task. When new workers join your team, you must account for the time it’ll take them to learn their respective jobs and your organization’s culture. If you hire someone who’s never dealt with contracts before, it may take them even longer to grasp everything. They won’t be able to complete paperwork quickly, either. That is why it’s critical to have checklists in place. These give employees guidelines they can refer to every time they review or process contracts. They also make identifying faults easier because you can always track them on the same checklists.
- Empower Employees
Some business owners and managers make the mistake of wanting to stick with the old. It’s said that if something isn’t broken, don’t try to fix it. However, once you discover something is amiss, you must be willing to make changes so that everything works correctly.
Understand that the process that’s currently there may not be as great as you think. Therefore, consider allowing employees to share ideas on optimizing existing processes based on their experiences with them. They’re a valuable source of information you should pay attention to because they’re on the ground. They can see what’s working and what isn’t. So, please pay attention to any ideas they may have.
- Use Smart Contracts
If you use a customer relationship management system (CRM), you can leverage smart contracts. Instead of drafting contracts from scratch on a case-by-case basis, you can generate one using data from your CRM system.
Advanced CRM systems can analyze data from previous successful contracts and generate new ones based on them. Smart contracts make use of predictive analytics, which uses past data to forecast or map out potential future outcomes. They also reduce human error and save time. However, keep in mind that such systems aren’t perfect, so it’s still a must to double-check contracts before signing them.
Every company is unique, and each has its contract management process. However, organizations that manage many contracts may get overwhelmed if they rely on physical labor alone. Investing in a contract management software solution is their best bet. Automation is vital to optimizing the contract management process because it requires more than human effort.