Most likely, you realize there is a better way to manage contracts that your legal department creates or is responsible for reviewing. Maybe you have a contract administration system that isn’t working. You might be thinking about looking for help.
Although it is a common practice to manage contracts through file cabinets and folder storage manually, inefficiencies can lead to decreased efficiency. An automated contract management system will allow companies to save time and automate many processes involved in managing contracts. This will increase their value. This guide will help you understand contract management and how to manage your contracts. It will also guide in selecting an automated solution.
Before you begin your search for an automated solution for contract management, you need to understand what contract management is and how it works.
What is Legal Contract Management?
Legal contract management is the management of the contracts between a company’s clients’ legal department or other divisions of a corporation. Contract management includes contract creation, negotiation, and adherence. Service level agreements are also included.
The following are some of the most common types of contracts legal professionals use:
- Trust deed
- Lease agreement
- Service agreement
- Commercial agreements
- Litigation documents
A well-executed contract management process can protect you from all types of legal action by ensuring that all requirements are met promptly and effectively and all the contents of contract management database are secure.
Contract and legal project management are essential for managing multiple legal processes and satisfying clients on a large scale. It is nearly impossible for legal teams and their lawyers to complete all arrangements without a well-organized administrative process.
The Key Features of Contract Management Software
- Document Generation. This system should allow lawyers and business personnel to create templates from contracts. Ideally, they can choose from menu options and fill in the form fields.
- The templates should include user instructions. Any information or clauses that are required should also be identified and managed. Users should be able to attach any correspondence or documents within the contract folder.
- The system should support multiple document formats, including spreadsheets, images, and word processing files. The system should keep the original contract and any subsequent revisions after creation.
- The system’s database should retrieve key metadata from user-created templates, such as party names and addresses. This information is crucial for future contract administration, reporting, and risk mitigation.
- Workflow Tasks such as contract review and approval should all be automated using checklist tasks, communication flow, and the systematic delineation of roles and responsibilities.
- Business people and attorneys should be able to review and approve agreements quickly, request additional details, or issue approvals. It is crucial to compare new contracts with templates and make revisions according to the version.
- Contract Administration and Risk Management. The software should remind the assigned personnel when a contract is due to renew, or other important dates are approaching. It should flag high-dollar transactions or agreements with parties on the “watch list” as risk indicators.
- Auditability and compliance with quality assurance requirements should be key features of the system. The system should automatically generate standard management reports and action items and be forwarded to the appropriate personnel.
- Administrators and system users should review and report on individual contracts in batches. All reports related to contracts should be generated by in-house counsel with just a few clicks.
Why Your Legal Department Requires a Contract Management Software?
A Contract Management Software for Legal Departments could significantly impact ROIs, collaboration, efficiency, and productivity throughout the contract lifecycle. These software systems have been proven to reduce time, increase productivity, and eliminate errors. These are the features that make law firms and teams more successful:
You can create custom templates to generate repetitive contracts. Users can create custom templates for repetitive contracts by simply filling in a brief questionnaire. This makes contract drafting much easier than ever, often without the need for legal intervention or chain approvals. A template can also eliminate errors related to layout or spacing issues.
What happens if you handle a complex document requiring multiple signers or approvers at different stages of the document’s lifecycle? Here’s where workflow configuration is useful. The workflow configuration allows users to organize the entire lifecycle into stages, assign signers and approvers, send reminders and notifications, and centralize the process to eliminate bottlenecks.
Secure Archives & Smart Repository
Legal departments use these systems to keep track of their contracts and documents over time. It is important to archive in a secure repository, but it is much better to have that central space smart, configurable, and searchable with specific permissions.
Are you asking yourself, “How can I sign a PDF?” Integrating Legal contract software with electronic signature tools is possible through the use of Legal contract software. Electronic signatures can be done securely from anywhere.
It can be difficult to track the status of thousands or hundreds of contracts. Contract Management Software provides a smart, flexible reporting system that lets you track all contract progress from one dashboard. It gives you all the information you need at a click.