4 Secrets to Successful Contract Management
Contract management has become a hot topic in the legal industry in recent years. Non-lawyer executives are acknowledging what lawyers have been saying for a long time: getting a handle on agreements is a sure way to manage risk and save money. “Contract management” typically refers to the process of managing contracts. It also describes roles like “Contract Manager,” “Legal Ops Manager,” roles within broader job descriptions, and even features of legal tech software.
While it’s possible to manage contracts successfully without technology, leveraging legal tech can enhance ROI, mitigate risks, and speed up processes compared to relying solely on human capital. This doesn’t diminish the value of your team; rather, it allows you to allocate your team’s efforts to high-value tasks rather than administrative functions.
Limiting the analysis specifically to technology for a moment, here are four key elements for successful contract management.
1. Implement Efficient Intake Processes
Streamlined and repeatable intake processes can significantly improve how you collect information from internal customers. A well-designed intake process simplifies the request tracking and auditing process. Rather than the random email, message or casual conversation, having a defined process is critical.
Leveraging technology in intake processes should include using centralized forms—no more emailed requests! —and automating workflows. For example, an online intake form allows internal customers to submit the necessary information, which can then be automatically assigned or, in the case of repetitive documents like NDAs, sent straight to signature without attorney intervention.
This approach not only saves time and effort for the legal team, but also enhances the experience for internal customers by reducing back-and-forth communications and speeding up request fulfillment, thus improving interdepartmental relationships.
2. Collaborate Effectively with a CLM Tool
Effective collaboration on key documents is crucial for successful contract management. Consistency in collaboration and documentation is critical.
A Contract Lifecycle Management (CLM) tool allows you to keep your work organized and visible to team members with the appropriate permissions. This means that if you’re out of the office unexpectedly, your colleagues can still access your work, address urgent issues, and understand the context.
Tracking all relevant details is essential. This includes capturing external communications and noting any precedents set by previous contracts. Proper documentation helps manage risk, explain decisions, and streamline future work.
3. Prioritize Contract Storage
Centralized repositories can transform your contract management process if you’ve been managing contracts across individual computers, complex folder systems, or physical filing cabinets.
A central repository offers numerous benefits:
· Automatic Storage: Reduces the time spent filing contracts.
· Quick Retrieval: Allows fast access to any contract, regardless of who originally worked on it.
· Efficient Search: Pulls all contracts with specific terms or clauses in seconds.
· Easy Auditing: Generates comprehensive reports quickly, eliminating the need for manual searches.
Proper contract storage, whether using technology or not, is crucial for reducing risk, ensuring compliance, and saving time.
4. Utilize Reporting Tools
Legal teams are increasingly expected to demonstrate their value to leadership. Reporting on key performance indicators (KPIs), capacity planning, productivity, delivery times, and contract renewals/expirations are essential tools for proving this value. CLM tools facilitate this by offering up-to-date dashboards and customizable reports.
When evaluating legal operations tools, ensure you understand the reporting capabilities and how reports are generated. The ability to create tailored reports empowers you to extract and present the most relevant information, enhancing the tool’s value and utility.
By focusing on these four areas—efficient intake processes, effective collaboration, organized storage, and robust reporting—you can elevate your contract management practices and drive greater value for your legal team and organization.
Schedule a demo and find out how you can use legal software with AI technology like ALOE to create seamless workflows, improve quality assurance, and maximize your team’s potential.
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