Whether it’s Sales asking Legal to draft contracts to accelerate deal velocity, Procurement managing supplier agreements, or Finance tracking on-time payments and pricing changes, contracts underpin how your business operates. The right CLM tool can lighten the contract management burden on your teams and increase visibility across your business.
However, selecting the right one for your business is a significant undertaking. Start by identifying your business needs and carefully reviewing solutions to find the best fit.
Defining Your Business Needs
Contract Lifecycle Management tools are a valuable way to reduce costs and stay ahead of client expectations. However, implementing and using a CLM system requires careful consideration and planning. In addition, selecting the right tool can be a daunting task for many teams.
A successful implementation plan starts with identifying business needs and mapping current workflows. The goal is to automate processes where possible while minimizing disruption and ensuring critical users are trained.
For example, a legal team might use CLM software to eliminate manual steps that result in a delay or loss of information during the review process. This allows the team to focus on high-value tasks like negotiating or resolving disputes and closing deals.
Similarly, sales departments can use the features of a robust CLM solution to create contracts and proposals that are consistent with legal-approved terms and clauses. This ensures a standardized approach that saves time and reduces risk for the company.
It’s also important to look for a solution that has a centralized repository where you can store all your contracts, and which offers flexible folder structures and tagging. This will make it easier to find and locate specific contracts. In addition, you want a system that lets you set automated alerts for contract renewals and expirations. It’s also helpful to have access to advanced reporting functionality that gives you insights into contract performance, compliance issues, or opportunities.
Identifying Your Workflow Needs
For legal teams, the CLM solution should automate workflows to minimize bottlenecks in the contract approval process. Effective workflows assemble contracts based on rules and definitions, and support both sequential and parallel approvals. Users can also intervene manually to influence a workflow with ad-hoc steps to expedite contracting, and the system should alert approvers of contracts requiring their attention or approaching deadlines.
The contract department should have full visibility of all contracts, including those awaiting review, signatures, or expiration. This will help them ensure they are meeting internal and external obligations in a timely manner. In addition, some businesses need to manage third-party contracts, which can often involve more than one team member. This is a critical function that can be supported by a CLM solution that allows multiple users to access and edit documents, and that sends reminders to all involved parties.
Non-legal departments also benefit from a CLM solution. For example, sales managers can save time in the negotiation process with a solution that automates document generation and helps them quickly locate existing contracts for use as reference. This will enable them to make more informed and confident pricing decisions, increasing their ability to close deals.
CLM solutions can help other departments, such as procurement and HR, manage their contracts. For example, a cloud based CLM tool can provide a central repository for all agreements while automated workflows streamline the approval process and ensure that all necessary stakeholders are notified of new or revised contracts.
Identifying Your Technology Stack Needs
A tech stack is a collection of technologies used to build an application or website. Choosing the right one can save time and money, as developers avoid reinventing the wheel when building new products. It also maximizes efficiency by using existing code and frameworks.
There are many different types of tech stacks, each with its own strengths and weaknesses. Choosing the right stack can reduce development costs, while speeding up project delivery. A well-chosen tech stack can also help developers write quality code that is easily scalable.
For example, a team that chooses to use the LAMP stack (Linux, Apache, MySQL, PHP) can easily switch out components as their needs evolve. A good tech stack should also be compatible with other systems used in the business, such as ERP systems and CRMs. This enables data synchronization and streamlined workflows.
A CLM solution should include features that make it easy for teams to manage contracts throughout all lifecycle stages. This includes centralized contract storage, document generation, support for collaboration and negotiation, clause libraries, and rich integrations with other business tools. Another important feature is the ability to automatically generate a contract summary at every stage of the process and track changes in document status. It should also offer various file formats so users can access contracts with ease, and provide secure electronic signatures.
Identifying Your Goals
Ultimately, the right CLM solution should help you achieve your goals. It’s important to identify the benefits that matter most to your business so you can evaluate CLM software options based on those needs.
For example, some legal teams prioritize ease of use. If a new CLM program is difficult to navigate, it will require too much time and resources to get up and running. This may distract from more pressing legal matters or even halt progress altogether.
Another benefit to consider is the ability to integrate a new CLM solution with existing programs and Contract Lifecycle Management tools, such as CRM, ERP, Slack, and email systems. This allows you to have a single, comprehensive system that helps everyone work efficiently. You can also streamline the onboarding process by starting small and focusing on easy wins like getting contracts into a smart repository.
Finally, you can increase adoption by ensuring that your team has access to training and support. Make sure to include this in your project plan so critical users have a way to ask questions and resolve issues as they arise. You can also find CLM vendors with low-code options that don’t require extensive IT involvement, which makes onboarding easier for tech departments too. This helps to alleviate any stress or concern that might come with introducing a new tool to the workplace.