General Counsels spend significant time and efforts in drafting, negotiating a complete, error-free, protective and safest legal contract to protect interest of the organization. In the process, all contracts have various obligations, which are to be adhered to by all the parties to contract. While the agreement is drafted, negotiated and signed most efficiently, however, once it is signed and stored in physical storage its many times Obligation Management is being missed out by all the parties.
Every legal contract, whether it is signed, with customers, vendors, service-providers always contain various obligations. These obligations are well documented in the executed agreement and have defined roles and responsibilities.
These obligations are related to various security standards, certifications, change in management, profitability, senior management etc. Any possible deviation from obligation can result in :
- Cancellation of the contract OR
- Can impact deliverables.
Every obligation is a legal commitment by respective party and any deviation from obligation may result in cancellation of contract, penalties, fine or legal suits.
Every contract be it for supplies, services, software purchase, software support, raw material purchase or having consultants on board, obligations are integral part of all agreement. While day-to-day purchase contract may not have too many obligations, however, large customer contracts, strategic alliance contracts, M&A contracts always consist of many obligations and a constant compliance is must to ensure smooth running of business.
When we have physical signed contract it is not really usual that all obligations of executed contracts are listed and tracked regularly. With smart Contract Life-Cycle Management software having specific module for obligation management module, it has become so easy to manage all the obligation on regular basis and ensure that all obligations whether with respect to own organization or with respect to counter-party organization, these are complied and documented.
Volody`s Contract Lifecycle Management has excellent feature and it automatically captures obligations at the time of drafting the contract and hence you do not need to read contracts again, building list of obligations and making a obligation management report for each contract. All these activities are done during drafting of contract and immediately upon execution of contract, an Obligation Management module is updated and respective people within or outside the organization gets alerts and notifications well before deadline to ensure all obligations are reviewed and addressed. A smart dashboard gives you perspective of all obligations information (contract-wise, counter-party wise or period-wise) to allow you to focus on Obligation Management and ensure complete compliance with Obligations Management of all the executed contracts.