BEYOND THE BINDERS: MODERNIZING CONTRACT MANAGEMENT IN THE DIGITAL ERA

by Conor Looney | CEO | May 16, 2024 | Contract management, eDiscovery

In our rapidly evolving digital landscape, where every aspect of business is evolving at breakneck speed, clinging to outdated contract management practices is a recipe for inefficiency and missed opportunities. In a fast-paced business environment, modernizing contract management is no longer optional; it’s essential.

*The Forrester State of Systems of Agreement Study, 2020, commissioned by Forrester on behalf of DocuSign, highlights some of the challenges faced by organizations in managing their contracts.     

CONTRACT MANAGEMENT

Forrester conducted an online survey of 954 global technology purchasing decision-makers. Many of those who responded said they were experiencing challenges in the agreement process within their current organizations.

  • 56% said they often lacked visibility into the status of their current agreements, which could include new business or employee contracts.
  • 48% said there were delays in their contract signing process due to errors or missing information.
  • 41% indicated that customer experience was poor because of challenges in the agreement process.
  • 41% said they experienced delays in both routing and obtaining signatures in the correct order.
  • 38% said they have concerns over the legality of electronic signatures.

 *https://www.docusign.com/en-gb/blog/forrester-study-what-challenges-do-organisations-face-when-obtaining-contract-signatures

Modernizing traditional contract processes can be a complex undertaking. Legacy systems, siloed information, integration issues, Security concerns, Lack of expertise, and resistance to change can all create significant roadblocks on the path to a streamlined, digital future for contract management.

contract management

Despite these challenges, the benefits of modernizing contract management can be significant. Digital solutions can streamline workflows, improve contract visibility, and reduce risks.

FROM PAPER TO PIXEL: INNOVATING CONTRACT MANAGEMENT IN TODAY’S DIGITAL LANDSCAPE

Modernizing contract management in today’s digital world involves leveraging technology and streamlined processes. Here are some steps you can take:

CONTRACT MANAGEMENT

  • Implement Contract Management Software: Invest in a robust contract management software solution that offers features such as automated contract creation, storage, tracking, and analytics. This centralizes your contracts, making them easily accessible and searchable.
  • Digitize Contracts: Transition from paper-based contracts to digital formats. Scan and upload existing paper contracts into your contract management system to create a centralized repository. Going digital improves accessibility and reduces the risk of physical damage or loss.
  • Standardize Contract Templates: Develop standardized contract templates for different types of agreements. This ensures consistency across contracts, reduces errors, and streamlines the contract creation process.
  • Automate Workflows: Implement automated workflows for contract approval, review, and renewal processes. Workflow automation reduces manual tasks, accelerates contract cycles, and minimizes the risk of errors or delays.
  • Enable Electronic Signatures: Adopt electronic signature solutions to facilitate remote contract execution. Electronic signatures streamline the signing process, eliminate the need for physical signatures, and accelerate contract turnaround times.
  • Integrate with Other Systems: Integrate your contract management system with other business systems such as CRM, ERP, and accounting software. Seamless integration enhances data consistency, improves collaboration, and provides a holistic view of contracts across the organization.
  • Enhance Security Measures: Implement robust security measures to protect sensitive contract data. This includes role-based access controls, encryption, regular security audits, and compliance with data privacy regulations such as GDPR or CCPA.
  • Utilize AI and Machine Learning: Leverage artificial intelligence and machine learning capabilities to automate contract analysis, risk assessment, and clause extraction. AI-driven contract analytics can identify trends, risks, and opportunities within your contract portfolio.
  • Provide Training and Support: Offer comprehensive training and support to employees on using the contract management system effectively. This ensures widespread adoption and maximizes the system’s benefits.
  • Continuous Improvement: Continuously evaluate and refine your contract management processes based on feedback, performance metrics, and industry best practices. Regularly updating and optimizing your approach ensures that your contract management practices remain effective and aligned with business objectives in the evolving digital landscape. Top of Form

ALSPs: Revolutionizing Contract Management in the Digital Era

ALSP (Alternative Legal Service Providers) like LDM Global play a significant role in modernizing contract management in the digital age. Here’s how: 

Contract Management

  • Implementing CLM Systems: ALSPs can help organizations select, implement, and integrate CLM software with existing systems.
  • Standardizing Contract Templates: ALSPs can develop and maintain standardized contract templates that are tailored to the organization’s specific needs and industry best practices.
  • Automating Workflows: ALSPs can help automate repetitive tasks in the contract lifecycle, such as routing contracts for approvals, generating reminders for key dates, and tracking contract performance.
  • Providing Expertise in Negotiations: ALSPs can leverage their legal expertise to negotiate favourable contract terms and ensure compliance with regulations. 
  • Managing Contract Data & Analytics: ALSPs can assist with data extraction, analysis, and reporting to provide valuable insights into contract performance and identify areas for improvement. 
  • Scalability and Flexibility: ALSPs provide scalable solutions that can adapt to the changing needs of businesses. Whether a company needs to manage a handful of contracts or thousands, ALSPs can adjust their services accordingly. Additionally, they offer flexibility in terms of engagement models, allowing clients to choose the level of support that best fits their requirements.
  • Global Reach and Expertise: Many ALSPs operate on a global scale and possess expertise in navigating the complexities of international contract management. This is particularly beneficial for multinational corporations that deal with contracts across various jurisdictions.

Overall, ALSPs play a crucial role in modernizing contract management by offering technology-driven, cost-effective, and scalable solutions that enable organizations to handle their contracts in the digital age efficiently.

INTEGRATING ALSPS INTO CONTRACT MODERNIZATION: A STEP-BY-STEP GUIDE

Integrating ALSP (Alternative Legal Service Providers) into modernizing contracts can streamline and optimize the contract management process. Here’s a step-by-step guide on how to do it:

 Preparation:

  • Assessment of Current Contracts: Begin by assessing your current contract management processes. Identify pain points, inefficiencies, and areas where ALSP could bring value.
  • Define Objectives: Clearly define your objectives for modernizing contracts. This could include reducing costs, improving efficiency, ensuring compliance, or enhancing contract visibility.

Collaboration with ALSP Provider:

  • Selecting ALSP Provider: Research and select a reputable ALSP provider with experience in contract management. Look for providers with expertise in your industry and a track record of successful implementations.
  • Establishing Collaboration: Work closely with your chosen ALSP provider to establish effective collaboration channels. Communicate your objectives, expectations, and timelines. Provide regular feedback on drafts and ensure they understand your specific needs and goals.
  • Identify Tasks for Outsourcing: Identify specific tasks within the contract management process that can be outsourced to the ALSP provider. This could include contract drafting, review, analysis, abstraction, and management.

The Modernization Process:

  • Develop Standardized Processes & Playbooks:  Work with the ALSP provider to develop standardized processes and Playbooks for contract management. This ensures consistency and efficiency across all contracts.
  • Implement Technology Solutions: Utilize technology solutions such as contract management software to facilitate collaboration and automate routine tasks. Ensure compatibility with the ALSP provider’s systems for seamless integration.
  • Establish Quality Control Measures: Implement quality control measures to ensure the accuracy and compliance of outsourced contract work. This may include regular audits, performance reviews, and feedback mechanisms.

Additional Tips:

  • Training and Knowledge Transfer: Provide training to internal staff on working with the ALSP provider and utilizing new technology solutions. Facilitate knowledge transfer to ensure smooth integration and ongoing collaboration.
  • Metrics & Measurement: Establish metrics to track the progress and success of your contract modernization efforts. This could involve measuring turnaround time, cost savings, or user satisfaction.

In summary, the digital age presents unparalleled opportunities for revolutionizing contract management. Through the strategic utilization of cutting-edge technologies such as AI and automation, businesses can optimize processes, minimize risks, and foster seamless collaboration throughout the entire contract lifecycle. Partnering with specialized firms like LDM Global further empowers organizations to unlock enhanced agility, cost-efficiency, and heightened insight into their contractual ecosystem, ultimately gaining a substantial competitive advantage.