4 Traits of a Contract Management Software Built to Succeed
If we look up ‘contract management software’ on Google today, welcome across several solution providers across the world. Even if you refer Gartner reports, the list is huge. On reading the solution descriptions, whether on their website or elsewhere, we come across common themes–eSignatures, version management, obligation tracking, and so on. As a solution evaluator, you may easily get confused with the information overload and get distracted from what you truly need in your contract lifecycle solution.
10 min read
4 must-haves in your contract management solution:
We conducted months of customer deep-dives, which brought together hundreds of years of collective experience in the field of corporate law and contract management (across various verticals like manufacturing, IT, pharma, and biotech and healthcare). It led us to certain essential traits that make a contract management solution intrinsically successful: (1) Frictionless contracting, (2) Democratization and self-services,(3) Native negotiation, and (4) Efficiency hacking.
1. Frictionless contracting
Contract management is stressful. It sets the tone for long term business relationships and tends to be a touchy zone. Everybody ‘wants to get done with it.’ But the in-house counsels have to take care of due diligence and safeguard business interests against all possible eventualities. At the same time, contract requesters wonder what the big deal is. It leads to a lot of friction. You don’t want a software that adds any more of it (the friction) to the contracting processes.
It is very much possible that a contract management tool feels way more complicated, time-consuming, iterative, and frustrating than your existing manual processes. After all, we have all used technology that we would like to run away from, given a choice.
Keeping this mind, we at SimpliContract paid particular attention to using automation as an opportunity to change the way managing contracts ‘feels like’ in organizations. With Simpli360, our unique contract drafting studio, we have successfully eliminated various possibilities for friction during the entire authoring and review phase. Essentially, Simpli360 offers a holistic view of every aspect of contract creation –obligations, clause-level deviations, approval stages, audit logs, versions, related contracts, and additional documents, and peer collaboration. It minimizes the number of clicks and the rounds of switching between different windows, applications, and even tabs within the tool. Thus, the entire contracting process becomes extremely smooth, like butter.
2. Democratization and self-services
Another common challenge with contract management is the dependency on in-house counsels, legal teams, and senior employees to get the verbiage right’! It reduces efficiency. To avoid the loss of time, business users use whatever they can lay their hands on. More often than not, they work with non-standard or outdated templates and edit it as per their convenience.
When the incompliant verbiage falls on the desks of reviewers, they bite their tongues and edit fine copy through insane working shifts.
We turned this problem around and put accountability in the hands of contract requesters themselves. Itis the reason why SimpliContract has a contract creation wizard for guided step-wise authoring and self-service portals for business users in sales, procurement, and even legal. Here, there are clause-level and contract-level libraries for various business units, contract types, purchase categories, and contract scenarios, which make life easy for contract requesters(and reviewers!). And the AI-driven Natural Language Processing reviews the in-progress draft while ensuring adherence to the best practices standardized across the organization. Thus, every business user, even though not a pro at creating contracts, can navigate easily through the drafting phases as the system guides them to create fully compliant agreements. And the contract reviewer can say goodbye to stretched working hours.
3. Native negotiation and collaboration
Negotiation is an integral part of contracting. Very rarely does a contract get signed without either party objecting to specific terms and conditions therein. Multiple rounds of communication take place over emails and phone calls. And several versions are created before the final one gets signed. Keeping track of the entire negotiation journey (with ready facts and references) becomes difficult and time-consuming, as subject lines get changed, people get missed from email chains, and sensitive data gets lost in the correspondence.
Since the business relationship is at stake, the stakeholders typically tend to ‘detach’ themselves from the ‘act of negotiation,’ and business users act as uninvolved mediators between the legal departments on both sides. It further affects the cycle times.
To address this challenge, in SimpliContract, we enabled native negotiation and collaboration. Chat widgets for instant messaging with internal users, senior approvers, legal counsels, vendors, and customers help reduce the negotiation cycle time considerably. At any given point of time, records of all the correspondence, redlining, suggestions,etc. from all internal and external stakeholders are inside the tool for ready reference. Email and mobile notifications even negate the need to log into the software again and again. Yet, every activity is logged chronologically in a centralized manner
4. Efficiency hacker
Like any other technology, contract management software is as good as the use we put it to. One may have uploaded all the templates, defined all the deviations, configured all the business rules, and assigned all the roles, but continuous improvisations are needed forever. Regulations keep changing; contracts keep getting more complex; users may prefer to choose the sub-optimal clauses in fear of losing a customer contract. These are the real contract management problems that will keep cropping up, notwithstanding the presence of software.
Legal, contract management, and procurement teams responsible for the return on investment from these solutions need to know ‘how to get there.’
If a tool helps the users get the best out of it and tells them how the adoption of various features has been resulting in performance improvements, then excellence in contract management becomes easily reachable. For this purpose, SimpliContract provides usage analytics for templates and clauses, obligation fulfilment, and other contract management performance trends. These help you turn contract management function into a center of excellence.
Frictionless contracting, democratic and self-serve authoring, native negotiation,and efficiency hacking are the four strong pillars that create the foundation of SimpliContract solution. We were privileged to discover these traits very early in our product research journey, thanks to tonnes of end-user feedback we had flowing in. We suggest you look for these characteristics in your contract management solution as they will not only bring ease in your contract lifecycle but also drive return on investment from day one.
What are some of your enterprise contract management challenges? Do you feel these characteristics we mentioned will help you turn your challenges into opportunities for growth and collaboration? Tell us, and we would love to hear your thoughts!