Congratulations, you’ve finalized your contract! After weeks spent drafting, altering, and negotiating, the terms are agreed, the signatures executed, and the ink is dry (digitally speaking). But what now?
A few decades ago, the answer would have been “nothing.” Legal document management for your contract would have consisted of burying it in a dusty filing cabinet, out of sight and mind; and perhaps being able to dig it out if some problem or litigation required retrieving it.
Although technology has evolved, legal document management for contracts, in many cases, hasn’t. Legal documents are all-too-often relegated to a shared server or cloud-based storage application that is little more than a digital file cabinet covered in digital dust. While digital storage does allow contracts to be retrieved more easily, by itself it doesn’t do much else.
In a truly digital world, simply storing contracts and other legal documents is no longer enough. Beyond simple storage and retrieval, a new, more active definition of legal document management for contracts is emerging. Legal document management today is a more active, process that encompasses all the ways a business works to manage its obligations and benefits after an agreement is signed.
As companies chafe at the limitations of old legal document management approaches, they are increasingly shifting from storage-centric digital solutions to contract management systems. By digitizing both contract content and process, a contract management system turns basic legal document storage into modern legal document management.
Even a basic contract management system can store, search and retrieve legal documents Further, a contract management system should retain multiple iterations as versions of a single document, rather than a pile of separate documents in a digital folder. This makes finding and comparing multiple versions much more practical than traditional storage.
A more advanced Contract Lifecycle Management (such as, we blush to say, ContractRoom) can take Legal Document Management much further by actually managing obligations and contract compliance as well as documents. Instead of requiring humans to constantly refer back to the contracts to ensure both parties are holding up their ends, an advanced CLM system can bring the terms contained in a contract to life. When an amendment is made, a milestone is met, or a deadline is approaching, all users can be notified.
Incorporating a contract management system into your business offers substantial benefits beyond legal document management; including greatly streamlining drafting and negotiation of contracts. However, for many businesses, legal document management is the “gateway drug” that first leads them to consider a contract management or advanced CLM system.
The days of simply filing a contract away are long over, and the digital equivalent of a file cabinet is no longer enough. Adopting a Contract Lifecycle Management system for legal document management greatly improves visibility and saves time and money for all parties.