Effective contract management not only involves emerging agreements and authenticating them, but it’s a series of events that direct you from the initial stages of evolving complete processes for managing each and every agreement of the company, through the steps to check contracts through to its conclusion.
Get a clear understanding of what happens at every stage to confirm that all contract management procedures meet the objectives and requirements to achieve optimal results.
Here are the seven crucial stages involved in contract management software
1. Planning stage
Before you implement a process, it’s vital to opt for a system that best suits the needs and resources of your company. To keep things organized and streamlined, it’s crucial to raise a contract management system that is applied company-wide.
Your contract automation software must comprise a flexible roadmap involving the processes that address all types of business contracts, from ordinary employment contracts to highly complex and specific deals. Therefore, the first step of developing a strategy is to regulate your requirements, including answering the following questions:
What are the categories of contracts you want to manage, and in what volume?
Is there any standard agreement you want to use again and again? What must be included in these?
Who is involved in each stage, and what do they require to complete their job?
What sort of problems has happened in the past, or what issues may occur during the management process?
What resources are needed in contract strategy?
Understanding all the stages of contract management that help inform your processes.
2. Implementation stage
Once you have the blueprint of your contract management procedures, you need to start implementing your plan before you can use it. This includes contract management software that helps execute all the contract-related responsibilities and shift the contracts to a central repository.
A vital part of the implementation strategy is onboarding, which ensures everyone involved understands your objectives and vision of contract management and easily uses the tools in the process.
3. Pre-contract stage
Now that your contract management groundwork is set up, you can start implementing it for future contracts. That means making new contracts or executing boilerplate contracts for a standard situation. The key challenge in this phase is to develop a detailed document that delivers your requirement and reduces your risks.
This phase is as easy for ordinary situations as looking for the right contract type, filling in the right information, and possibly making a few tweaks. More complex contracting situations are checking the development of an entire document. Making a contract from scratch is made easier by looking at other applicable agreements and familiarizing those terms and conditions. Don’t forget to include important requirements like branding standards or compliance obligations. Once you have approved the terms and made your contract, e-signatures keep the process moving.
4. Handover stage
It’s standard, particularly in big companies where the individuals are included to execute the contract are not the ones who negotiated it. Thus, to guarantee the contract is content as expected, it’s vital to perform a smooth delivery. Instead of assuming shareholders get everything they require, it’s beneficial to spend time looking over all the details and confirming responsibilities and milestones.
5. Contract stage
This stage is where all goals come to life – if you properly manage them. And many management works are done already, thus setting you up to do just that.
But this stage doesn’t accomplish itself – it’s here when you have to pay close attention to all of the terms in your agreement and execute consistent monitoring to ensure the whole thing is working as it should. It’s beneficial to have an idea for performing so, with a clear aim of milestones and routine metrics that let you approve everything is on track – or offer an early warning if any glitches arise.
6. Pre-renewal stage
Nothing stays forever – not even the contracts. But there are many ways your contracts can end: unique contracts may come to an ordinary conclusion, you can renew the agreement, or select to dismiss it. Often, some terms – and even default actions or penalties- affect the outcome; that is why it’s imperative to think about the end of your agreement in a timely and practical manner. Now is the time to estimate how the contract is performed and choose if you want to recommence or make any changes. Ensure all the shareholders know about the end and renewal dates and have enough time to go through all the information before you make any decisions.
7. post-contract stage
Once the contract comes to an end, there is still some alteration to be done to ensure everything is concluded properly. This includes safeguarding termination situations, paying or issuing final statements, and archiving your agreement. Therefore, it’s useful to accomplish a contract examination, highlighting valuable information and learnings that improve the outcomes of future contracts.
