How to be the boss of contract management

Signing a contract is a great feeling, isn’t it? It might mark the start of a new business relationship, or the continuation of a long and loyal one. It might mean you’re welcoming a new employee to the ranks, or bringing in a sensational new supplier. Indeed, getting your contracts right is key to business success. Which is why contract lifecycle management matters.

Let’s explore the fundamentals of contract lifecycle management, and look at how a systematic approach to managing every aspect of a contract throughout its entire lifespan can lead to greater efficiencies, reduced risk, improved compliance and more. 

What is contract lifecycle management? 

Contract lifecycle management is the end-to-end process of managing contracts — from first drafts and legal approval, through negotiation, signing, storage and ongoing monitoring. 

Gone are the days of filing contracts in cabinets and trying to figure out which ones need renewing, and when. Sure, such systems might fly in a very small business that only handles a couple of contracts each month. But as your business scales, things get complex. Manual handling leads to errors, bottlenecks and increased risk.

It’s why contract lifecycle management is now being driven by digital tools and platforms. Going digital saves time, saves paper, and takes the tedium out of managing contracts. With their automated workflows and alerts, standardised templates and collaborative tools, contracting platforms make contract management a breeze. In fact, organisations that use contract lifecycle management software report an 83% reduction in contract process times.

What does best practice look like?

Regardless of what tool you use (although, of course, we will always recommend DocuSign CLM), you can apply some basic, best-practice principles when setting up your systems to manage contracts. 

• Roles and responsibilities. Clearly outline who is responsible for each stage of the process, from initial set-up of contracts, to managing renewals or termination. Different contracts will have different people assigned to them, but being clear from the start will help with day-to-day management. You may even choose to establish an internal contract management team to oversee the end-to-end process. 
• Templates and clause libraries. Develop pre-approved templates and clause libraries for common contracts. This saves time, promotes consistency, and reduces negotiation complexity.
• Central storage. Ideally, establish a central, secure repository for storing all contract documents and related information. This way, if a key stakeholder leaves your business, other employees can still easily search and find the contracts or key dates they need to keep business deals moving.
• Alerts and updates. Use a contract lifecycle management platform that will give you alerts when important dates are coming up — such as renewals, expiration, and performance milestones. This way, you’ll never miss a deadline. With the right platform in place, you can automate other tasks, too, like reminders to sign a contract or get internal approval on a clause change.
• Risk management. Set up processes to address any risks that may impact the outcome of a contract — from staffing changes to supplier costs to new legislation.
• Regular reviews. Like any business practice, contract lifecycle management is something you should regularly monitor and review. For example, a change to compliance regulations may necessitate a change to your contracting process. As part of this, keep records throughout the process to ensure good governance, transparency and accountability.

Ultimately, getting a handle on contract lifecycle management will help you streamline the process of setting up new business relationships — and then keeping them healthy into the long-term. Don’t believe us? Learn how DocuSign CLM works and see how it could support your business.