For starters, no, the answer to the question above has nothing to do with rental carsor a science fiction franchise. Anyone here for those topics should click along.
Still with us? Good. If you're still reading this, then you probably know enterprise contract management has something to do with contract management, by which we mean the universe of tasks associated with entering into, complying with, and enforcing contracts in your business. What does the word "enterprise" add to the mix? Read on to find out.
Contracts and the "Enterprise"
For many businesses, "contract management" consists by default of a siloed set of tasks typically overseen by the legal department, an outside lawyer, or the (possibly unlucky) employee with good organizational skills who keeps track of hard copy documents and electronic files.
The phrase enterprise contract management, on the other hand, invites business leaders like you to step back and view contract management not as a discrete set of tasks but as a concept that reaches into every nook and cranny of your business. It's a wholistic perspective on your business, if you will, instead of a quasi-administrative job description.
Because, when you think about it, contracts do affect every facet of your operation: sales and business generation, capital investment, HR, sourcing, marketing, and so on. Contracts, whether made via a phoned-in purchase order or lorded over by a team of attorneys at a day-long closing, define the operational tides on which your business will rise or fall.
Enterprise contract management means treating your entire body of existing, past, and future contracts as a resource from which you can draw insight, plan decisions and expenditures, and optimize operations.
Let's pause here for you to recalibrate your thinking around an enterprise contract management mindset. Go ahead. Keep reading when you're ready.
Wrapping Your Head and Arms Around Enterprise Contract Management
Oh good, you're back. So, if you've done some thinking about enterprise contract management as we've defined it above, and if it's a relatively new concept for you, then you might feeling a little overwhelmed. Approaching your business's contacts as an interrelated body of rights, obligations, and information requires serious analytical horsepower. It's understandable if you feel a little daunted. So would we. Humans aren't really built for the kind of informational processing it takes to treat your corpusof contracts as a whole organism.
To implement enterprise contract management, you need more than brain power. You also need tools that do best what humans tend not to do very well at all: tools that absorb massive amounts of data, parse that data in a useful manner, and do it all in a split second.
Leveraging Enterprise Contract Management Solutions
Tools like Contract Room, in other words.
Enterprise contract management solutions like Contract Room take your contracts out of file cabinets and network folders and turn them into living, breathing sources of business analytics. How? By tracking contracts through their entire life cycle and actually knowing what they say and how they relate to each other. Here's what we mean.
With an enterprise contract management solution, your contracts live in a central repository that we refer to as your corpus; that is, "the body" of firm's contracting information. Contracts find their way into the repository by being negotiated and drafted within the enterprise contract management platform. Instead of emailing copies of a contract back and forth, or (worse) scratching out terms in a form contract and writing in something different, your business can share virtually any kind of contract with a counterparty – be it a customer, a supplier, or a strategic partner – on a single, remotely-accessible electronic platform. That platform can assemble a template contract from existing contracts, circulate it to parties, track edits and proposed changes, and allow parties to e-sign. It's contracting made painless.
Once a contract has been executed, enterprise contract management solutions like Contract Room allow users to track a contract's performance and its relationship to other contracts within the corpus. For example, with an enterprise contract management platform up and running, a manufacturer can automatically configure sales contracts according to parameters of his supply-chain contracts, ensuring the sales team doesn't over-promise on the business's deliverables. Enterprise contract management solutions also give managers the functionality to implement instant, universal changes to frequently used contracts to ensure teams follow identical policies.
Finally, when the body of contracts in the corpus begins to encompass every type of contract relevant the the business, enterprise contract management solutions give business leaders the ability to query the corpus to answer operational questions. Not just How many deals did we do with company X last year?, but What are the terms our suppliers negotiate the hardest on and most frequently, and how have those terms changed over time?
Moving to an Enterprise Contract Management Mindset
If what we're describing sounds too good to be true, we get it. We built the Contract Room enterprise contract management solution to solve contracting problems so entrenched and persistent that some business leaders have come to think of them as unavoidable costs of doing business.
But it is possible to move your business to an enterprise contract management mindset. The process often starts with inviting a firm like Contract Room to come demo our product and show you the possibilities. In our experience, components of your business that have never so much as imagined thinking of contracts as a useful, dynamic body of analytical insight soon realize there are specific questions and problems enterprise contract management solutions can help to solve. There is an "AHA!" moment that happens, and then enterprise contract management is all anyone can talk about.
If you think you are ready to give enterprise contract management a try, and to discover the insight and efficiency you can gain from creating a corpus of your own, then contact us today. We'd be happy to open your employees' eyes to the opportunities enterprise contract management creates for your business.