Contracts are crucial to the success of any organization — but guiding them from initiation and creation through execution can feel like an endless uphill battle. Fortunately, there are state-of-the-art solutions that can reduce time spent on contracts, automate processes, and decrease manual work so your department can focus more on what matters most.
Throughout the course of history, contracts have defined history. From the Declaration of Independence to the Paris Agreement, contracts have developed nations, delivered freedom, and established peace. Contracts are no exception when it comes to business, whether it’s merging corporate giants like Disney and Marvel or creating legally binding documents for your enterprise.
In fact, nearly half (43%) of legal departments globally handle up to 1,000 contracts every year — a towering number that catapults even higher in the United Kingdom, where one in four (25%) legal professionals processes more than 2,000 contracts annually, according to the 2022 Enterprise Legal Reputation (ELR) Report. And with two in five (40%) respondents spending four to five hours each day poring over them, nearly half of every work week, quarter, and fiscal year is spent on contract review.
Moreover, slowly executed contracts adversely impact business, negatively affecting everything from deal closure and revenue generation (44%) to mergers and acquisitions (23%). Further, during what tends to be a labor-intensive and non-cost-effective process for Legal, other functions — such as Sales and Procurement — may be left wondering what stage their contracts are in, what the next steps are, and when they can expect to move forward.
However, contracting doesn’t have to feel overwhelming and seemingly infinite. Implementing an end-to-end contract lifecycle management (CLM) solution that meets you where you work can empower your business teams by automating the contract lifecycle, elevating collaboration, efficiency, and productivity across your entire enterprise — and enhancing partnerships with internal clients, customers, and vendors, too.
MAKE YOUR WORK WORK FOR YOU
Most organizations have repositories of contracts, but many do not have a structured process for storing and extracting relevant data for analysis. This can make drafting and executing contracts and the commercial policies and regulatory changes that contracts oversee arduous. Enter artificial intelligence (AI), which can enhance your data and allow for actionable decision-making.
An AI-enabled dashboard can unlock the data in contracts to influence faster business results by providing deeper visibility and the insight to assess varying levels of risk within a contract portfolio. With the dashboard’s ability to automatically calculate a risk score and present that information based on developed playbooks, Legal can clarify its contracts and review them more expeditiously. Further, sales and procurement professionals can leverage AI to report on cycle times and portfolio value trends, determine additional sourcing and profit optimization areas, and negotiate price breaks.
Introducing a clause library allows for even higher-level oversight and greater data-driven efficiencies. A library of specifically tailored, up-to-date contract generation templates with a central clause bank that captures new clauses regarding terms, details, and technical “legalese” eliminates the need to review contracts line by line. This ensures consistency, identifies issues often missed (even by professionals) to mitigate risk, and automates the process so Legal doesn’t have to spend time customizing contracts for typical agreements – and has been proven to increase productivity by as much as 50%.
MAKE YOUR WORK FLOW
Another way to simplify the contract management process is by pairing a robust contract management solution with a cutting-edge cloud-based system. All too often, when contracts are negotiated, significant details — such as fees and obligations — can get lost post-signature. For example, Procurement generally pays invoices when they come in; thus, they may not have kept negotiated terms top of mind. So how can they comply with supplier pricing and give more visibility into post-execution workflows?
Integrating systems can combine the benefits of both platforms, creating a streamlined contract workflow process that flows final contracts and data for ongoing management while improving transparency, amplifying efficiency, and enforcing compliance by reporting on commercial terms in a structured form. In turn, this can contribute to speeding sales cycles and time to revenue up to 24%.
MAKE YOUR WORK CONNECT
There is no denying that the contract process has become exponentially complex. Still, managing it doesn’t have to be.
What’s more, contracting has the capability to connect Legal more closely to the enterprise. Every department creates and manages contracts. Every department hires people, negotiates with clients, and makes agreements that ultimately lead to contracts. By taking control of the contract management process, your business will phase out data silos, remedy contractual issues, and embolden relationships between internal functions, while accelerating cost and operational efficiency as well as material impact. By tracking dashboard insights and utilizing AI-powered playbooks to identify key terms and clauses, Legal has the opportunity to become more strategic, visible, and efficient, giving Sales and Procurement greater transparency and agility – all while saving up to 9% in overall legal spend each year.
The practice of law is unequivocally an art. Technology has become an essential tool for contracts and a catalyst for growth, competition, and differentiation. CLM solutions augmented by AI-enabled dashboards and coupled with system integrations are a merging of art and science that represents a revolutionary new age of collaboration, innovation, and evolution today — as well as the promise of impactive business success for future tomorrows.
Learn how Onit’s next-generation CLM solutions and AI-powered innovations meet you where you work with end-to-end automation of the contract management process to cultivate partnerships, elevate efficiency, and ignite revenue growth for enterprise-wide success.