Uncovering the state of contract management in 2021
Contracts make the business world go around. Millions of them are generated every month by businesses across the globe – without them, many industries would grind to a halt. Yet how they are generated is changing fast, with the leaders in contract management realising the benefits of switching to more automated platforms.
This shift to contract lifecycle management (CLM) automation is one of the key findings coming out of The State of Contract Management 2020/21, a new report from DocuSign that shares the findings of a survey of 1,333 contracting professionals from around the world.
Respondents resoundingly agreed that automating contract activities – particularly those that take more effort, like contract generation, analysing contract data and getting signatures – is an important step that businesses should take. But before we dive into how contracting systems can be improved, let’s look at why improvements need to be made.
Contract management is time-consuming and error-prone
Creating and managing business contracts is a time- and resource-heavy task. Almost nine out of ten organisations take more than an hour to create every new contract, and almost half spend more than 20 hours negotiating each contract.
In fact, considering all parts of the contracting process, it takes an average of 29 hours of staff time to generate, negotiate and locate a contract. If you’re dealing with 500 contracts in a year, that equates to seven employees working full-time, all year round. No wonder so many contracting professionals have their sights set on better ways to create and manage contracts.
More than 90% of respondents say that human error impacts their current contracting process, with almost half saying that errors occur often. And all these errors get in the way of growth, with respondents saying that they face:
- Delays in closed deals (37%)
- Increased costs (34%)
- Missed opportunities (31%)
- Increased risk (29%)
Technology is the fix for these frustrations
Modern CLM solutions are a proven way to resolve the issues cited above. By automating previously manual, error-prone tasks, contract managers can generate contracts faster and more accurately. In fact, contracting professionals list a range of compelling benefits in using CLM software:
- Easier contract generation (51%)
- Increased contract accuracy (50%)
- Improved analysis of completed contracts (47%)
- Easier to find archived documents (44%)
- Streamlined contract lifecycle (43%)
- Reduced manual work (42%)
When AI is added to the CLM mix, the benefits are compounded. By automating tasks like contract generation, risk analysis, document tracking and workflow handoff, the risk of human error drops away, while things like speed, security and compliance improve. For example, AI integrations within DocuSign CLM deliver rich insights to streamline workflows. The system can automatically analyse a contract and route it with specific sections highlighted, so a reviewer knows exactly what they need to focus on. This reduces manual review times, while improving contract accuracy and minimising risk.
It’s the seemingly simple but ultimately sophisticated enhancements like these that are transforming how contracting professionals are eliminating the headaches and moving ahead with contract management.
Ready to improve your team’s contract process?
To learn more about how DocuSign CLM could take your contracting team from ‘meh’ to ‘yeah’, get in touch today. Or, as a starting point, read the full report on contract management to see how you compare.