Given your busy calendar, it may be difficult to keep tabs on your company’s contracts, however, not properly managing your contracts, can result in serious legal, reputational, and financial risks.
According to World Commerce and Contracting, inadequate contact management costs organizations 9% of their bottom line and can waste a significant amount of time as well. Not paying attention to contract expiration dates can impact a company’s bottom line, as failing to renew a contract can result in lost business. Perhaps one of the most simple but effective things you can do to improve your contract management is to centralize your contracts in a single, secure online location which will help you avoid having to search for misplaced contracts and will also protect your contracts from being hacked.
A good contract management software will help your business improve its agreement drafting & execution processes, however, some software solutions are not as seamless and easy to use as others. To ensure that your contract lifecycle management software is effective, one must ascertain these 5 factors to evaluate its performance.
5 ways to evaluate the effectiveness of implementing CLM software:
One of the easiest ways to evaluate the success of implementing CLM software is by having your team rate how effective it is in terms of performance and usability on a scale of one to ten, and then average their responses.
Ease of use
One critical KPI is figuring out whether the online contract management software is easy for your team to use or else your organization’s productivity will suffer.
There has been significant progress in technology and its no longer simple workflows or document management. A good contract lifecycle management software also comes up with smart artificial intelligence features that reduce processing time significantly. Features like auto capturing of obligations, risky clauses, agreement master data, and clause library are readily available with many leading Contract Lifecycle Management Software providers.
Contract-related risk score
Contract risks are typically scored on a scale of 1-5 and measured as missed deadlines, obligation compliance failures, risky clauses, and unsuccessful deal closures to name a few.
It may be time to test if you notice that your new contract management software solutions are not enabling reduced risk scores.
Response time & Frequency of software updates
The customer support team of your contract management solution provider must provide quick responses to fix issues you may have or else the wait time will delay your contract lifecycle processes.
A CLM software that has periodic updates to boost its service performance or new feature additions will prove to be beneficial to your contract drafting, execution, and management process.
Organizations normally implement contract management software solutions to expedite their agreement processes. If your contract lifecycle is not reduced with the CLM software that you use, you may want to consider switching to a different software service provider. Quick deal closures are essential to your organization’s productivity. You may be wasting time and resources on the service if cycles are not shortened.
Manual tracking and managing agreements is an inefficient process that will lead to wasted time in the contract cycle. Online contract management software is essential if you wish to boost your company’s productivity levels. Your business will save costs and time if it effectively utilizes a program by measuring its key performance indicators for your CLM success. Automated contract management software solutions will help reduce risks, ensure obligations are met, and decrease your time to close deals.