What is contract management?
Contract management is the process of negotiating, making changes to, and ensuring compliance with contractual terms as efficiently as possible while mitigating potential risks.
Many document management and enterprise content management (ECM) platforms can help store and retain contracts. The most advanced among them can also be considered workflow automation software, if they offer business process automation (BPA) functionality.
What is workflow automation software?
Workflow automation software digitizes common back-office tasks to reduce reliance on physical paper, increase the accuracy of documents and route information to stakeholders quickly, making the creation and approval of critical documents easier for everyone involved.
How does workflow automation software speed up contract management?
Workflow automation can speed up contract management processes from start to finish:
- Templatize contract creation for you and your vendors.Standardizing your contracts makes it easy to find information, and thus easier onboard new vendors or new staff for your own organization.
- Keep a system of record for changes and amendments.This transparency enables negotiating parties to have a clear picture of each change so that they can make decisions and additional changes faster.
- Quickly route contracts to stakeholders and approvers.Putting critical documents in front of approvers is a key step to more efficient operations.
- Monitor the status of contract negotiations and approvals.This increased accountability can help identify and thus rectify bottlenecks in the approval process.
- Enable relevant parties to access contracts from anywhere.Mobile, cloud and/or remote access to documents enables contracts to move forward, even when stakeholders aren’t in the office or vendors are in the field.
Can I manage contracts entirely online?
One of the biggest challenges for organizations attempting end-to-end contract management automation is signatures, which traditionally had to be signed by hand. Depending on local laws, some of which may have changed in reaction to the COVID-19 pandemic, many jurisdictions allow for all types of contracts, agreements and more to be signed online with electronic signatures.
An ECM system can help organizations meet these challenges by offering additional integrations with electronic signature services including pre-built solutions that are ready to work with your workflows right away.
Can I use software to enforce contract retention schedules?
While some records management actions, such as archival and disposition, likely need approval by a human actor, much of records management process can be automated.
Using records management features within an ECM system, you can set reminders for when your organization needs to archive or dispose of contracts. You can also set up notifications for when contracts are nearing their expiration dates, so you can decide if you want to renew.
How have organizations used workflow automation to effectively manage contracts?
Many organizations have found workflow automation software a powerful tool in more efficient contract management:
- New Caney ISDdigitized the creation, review and approval of its employee contracts. This was part of an initiative that digitized almost half a million records within its HR department alone. The district also saved more than $330,000 using ECM for records management and storage, instead of outsourcing it.
- Educational Service District 112 (ESD 112)reduced the time staff spent on interlocal purchasing agreements by as much as 90% per contract. This change, from spending 45 minutes per contract to just a few, has increased the district’s output significantly – it was able to review and sign 25 contract requests within the first two days since implementing new processes.
- Waterloo Region District School Board (WRDSB)automated its vendor registration process, reducing the time purchasing analysts spent obtaining information from vendors. This change helped WRDSB promote its paper reduction initiative, while also giving purchasing analysts a centralized database to locate vendor information.
- Texas A&M System’s Health Science Center (HSC) decreased processing time from six to eight weeks to one to two weeks per contract. By templatizing contracts within its ECM system, the center was able to streamline contract reviews and approvals as it moved between stakeholders – each involved party knew what information they needed to add when it came to them.
- Mille Lacs Corporate Ventures (MLCV), gained more visibility into contract reviews and approvals. It also reduced the time processing contracts from weeks to hours.Moving key processes such as contract management to the cloud also enabled MLCV to have less reliance on physical hardware, push updates instantly, and empower employees to get more done off-site.
- Fiducia streamlined its quotation generation and contract approval processes, enhancing transparency and improving communication between key company stakeholders and clients. Changes like these have created new opportunities for increased efficiency, resulting a savings of around 150 hours per year previously spent on contracts.
Want to learn more about how an ECM platform with powerful workflow automation capabilities can help your organization speed up contract reviews and approvals? Download our eBook: The Ultimate Guide to Contact Management.