Nothing can strike fear into the hearts of attorneys or businesses like “breach of contract.” Which is one reason all parties work so hard on the front end to ensure that the contracts they sign are both legal and policy compliant and performable. Contract negotiations can already be long, tedious and exhausting. Therefore, when a hard-fought contract is found to be non-compliant at the 11thhour before execution or, worse still, post execution, it can be painful for all parties.
Old-fashioned contracting processes are actually breeding grounds for such problems. Conversely, the intelligent contract management software now available to businesses provides a new level of control in addition to the obvious speed advantages of automation.Even a basic contract management solution provides companies with substantially more control than the “free for all” of emails, phone calls and Microsoft Word redlines that characterize old-style contract management.
However a more robust Contract Lifecycle Management system, such as ContractRoom, adds additional compliance guardrails. Not only does the software assist in document assembly, contract drafting and negotiation process, it can also ensure compliance both before and after execution. Digitizing the ENTIRE contract management process, the distinction between CLM and more basic contract management software, is a key bulwark against compliance problems. When every step of the contracting process can is automated within the system, every step can also be tracked and audited.
This comprehensive data collection allows you to recall any aspect of contract negotiations (and negotiators) with a click. If changes were made, the sequence is documented. Once the contract is executed, a robust CLM system can provide continuous monitoring and alerts to ensure that the requirements of the agreement are being honored.
To significantly reduce the cost, timing, and frustration of contract creation and document assembly, large corporations are turning to such Contract Lifecycle Management solutions to improve the compliance as well as the efficiency of their contracting process.
This is the 5th in a series of 5 blogs on core ‘CLM Modules’:
- contract drafting (blog 1)
- contract assembly (blog 2)
- contract operations (blog 3)
- contract management (blog 4)
- contract compliance (blog 5)