Enhance Contract Lifecycle Management with Seven Key Practices

Contracts are essential to business operations, yet many organizations struggle with inefficient contract management processes. To enhance contract lifecycle management (CLM) and turn contracts into strategic advantages, your company should implement best practices, as Ed Breault writes in a post on the Malbek website.

1. Set up a centralized cloud repository: A centralized cloud repository enables quick access to the latest contract versions. It enhances control and compliance, and provides the foundation for contract analytics and insights. Use standardized taxonomies, naming conventions, and metadata to organize the repository.
2. Use templates and clause libraries: Utilizing pre-approved templates and a clause library streamlines contract drafting and ensures consistency. It reduces negotiation cycles and disputes, promoting efficiency and clarity in agreements. Assess existing contracts to identify frequently used contract types and use a modularized structure with clear labeling.
3. Assign roles and establish collaboration workflows: Assigning clear roles and responsibilities facilitates accountability. Delineate process flows and responsibilities for each stage from intake through post-signature. Collaborating through mapped workflows ensures a seamless contracting process.
4. Automate manual tasks: Automation optimizes intake, approvals, and obligation tracking. It uses natural language processing and optical character recognition for granular searching, reporting, and compliance monitoring.
5. Track deliverables and milestones: Clearly defined deliverables and milestones, coupled with automated reminders and CLM’s reporting and dashboard capabilities, help manage obligations.
6. Implement approval workflows: Efficient approval workflows minimize bottlenecks and maintain an audit trail. Map all required approvers and decision points, and ensure your e-signature solution is compliant with e-sign laws and authentication standards.
7. Use KPIs and analytics to track performance: KPIs allow organizations to track contract performance, while analytics can provide insights into cycle times, compliance rates, overall contract value, and return on investment.

When you enhance contract lifecycle management with these seven key practices, your organization can accelerate deal making, reduce risk exposure, improve compliance, and build stronger commercial relationships, ultimately driving strategic value.