Contract lifecycle management software (CLM) has made business contract management more efficient and collaborative. With contract lifecycle management software, contracts don’t have to be painful. By adopting a CLM that allows you to leverage your data better (and attain valuable insights about the strategies you’re already implementing), you can take control of your organization's contract processes and create, negotiate, sign, store, execute, and review contracts with ease.
At Lexion, we know a little something about streamlining contract workflows. We understand that navigating can be difficult and leave potential users with lots of questions about the benefits of CLM. And who better to ask about CLM than…well, a CLM?
What is contract lifecycle management software?
Contract lifecycle management software is a type of tool that helps businesses streamline their contract management process at key stages. Before CLM was developed, contract management required several legacy tools used at different contract lifecycle stages. The result was a slow, disjointed, manual process that created lots of challenges and made contracting a nuisance.
With CLM, you can manage your organization’s contracts from start to finish on a single platform designed specifically for digital contracting. Innovative organizations are pivoting to using contract management software, and it’s for several good reasons.
How can software help with contract lifecycle management?
Utilizing contract lifecycle management software in your contract management system offers several benefits. Here’s a technology overview of contract lifecycle management, from our expert lens:
Automated contract workflow
Without CLM, your contracts usually follow a laborious manual process. Sales or other departments send in contract requests, and legal teams create contracts, often from scratch or using static templates. You send the contract to the counterparty via email. The counterparty redlines the contract in a Word document and sends it back to you.
With CLM, you can build a contract workflow that eliminates the need to move contracts manually from one stage to the other. You can create pre-approved templates, which is especially useful for your organization’s most recurring contracts. As you refine your boilerplate clauses, everyone on your team has access to your updated clauses and contract templates.
Streamlined contract negotiation process
CLM provides a collaborative platform for your contract negotiation and redlining. No more searching through long, confusing email threads and dealing with the possibility of stakeholders working with different contract versions. Each party can view any edit, comment, or suggestion made by others in real-time. The contract document updates automatically, ensuring all the stakeholders are always in sync.
Because we know legal teams love using Word for negotiations—trust us, our CLO is adamant about this—we’ve built a Microsoft Word Add-In for faster redlining that integrates with your CLM (you can find it in the Microsoft App Store).
Consistent version tracking
As you create, review, and approve contracts, they go through several stakeholders and various changes. Your organization’s shared drive may be littered with various contract versions and file formats, which can make it difficult to know the latest contract version and to determine the sequence of edits done on the contracts.
Throughout the contract documentation creation process, CLMs track everything that happens. From creation to signing and storing, you can see every revision, edit, and comment in the history of the document. Contract management software keeps these important records for properly auditing your contract and making alterations without fear of inadvertently saving over previous versions.
Easier internal contract review
Traditional contracting used tools that were not designed for contracting and therefore did not support the level of collaboration modern contracting requires.
Contract lifecycle management software helps stakeholders collaborate on processes like internal contract review more efficiently. When contracts are visible, all people involved know at what stage contract development stands and understand the actions that need to be taken. This is vital in the contract review stage where many departments usually participate, especially when the stakes are high.
In contract review, different stakeholders have to review and confirm that the contract terms are accurate, the contract complies with internal standards and external regulations, and the clauses are drafted properly. Contract management software stores all your contract data and related documents in a central repository, making it easy for contract stakeholders to access them from any device.
Our CLM uses artificial intelligence in our repositories to offer you access to a single source of truth for all your contracts and make search even easier.
Electronic signature collection
Electronic signatures are an accepted way of signing contracts and they’re a lot more efficient and time-saving than traditional signature collection. As your organization enters hundreds of contracts or more, electronic signatures offer an effective way to get your contracts signed without hassle. Unlike traditional wet signatures that require lots of time and effort to get counterparties to sign the document, you can simply send a signature request from your contract management platform.
Contract lifecycle management software has made it easy to collect electronic signatures from counterparties. Lexion and many other systems will integrate with document signing platforms like DocuSign, HelloSign, or Adobe Acrobat Sign to make the process still faster and more secure.
Automated alerts for contract renewal
Effective contract management requires you to track important contract deadlines, such as contract renewal. Some organizations still use spreadsheets to track contracts and rely on employees to keep track of key contract timelines manually. Contract software solutions automate this process by sending you timely reminders to prepare or begin contract renewal. No more missing opportunities to renegotiate more favorable terms or getting stuck in business deals you no longer need.
Contract performance tracking
Improving contracting efficiency starts with measuring and monitoring contract performance to identify areas of strength and weakness. However, to do this effectively, you’ll need to understand and identify your objective. In other words, what’s your goal? What aspect of your contract management do you want to understand and improve? Answering this question is crucial so you can decide the key performance indicators (KPIs) you need to monitor and evaluate.
Contract performance tracking also helps legal teams to provide data-backed evidence of their value to the organization. This is vital if legal will be perceived as a business partner and not a cost center.
Tracking contract performance helps in monitoring contract compliance, allowing you to ascertain whether parties are complying with contractual terms in their execution.
How do I choose the right CLM?
Contract lifecycle management software has real functionalities that streamline and standardize your contract management processes. CLM gives you a single platform for all your contract lifecycle stages.
A perfect contract lifecycle management solution should be intuitive and easy to use. This will encourage other departments to adopt it. Automating your contracting processes will free up your legal team to carry out tasks that add to your bottom line, and not waste time doing mundane tasks, such as tracking contracts on spreadsheets.
Lexion’s contract lifecycle management software is incredibly easy to use, and it helps small- and medium-sized businesses automate their contract processes. Our use of cutting-edge AI sets us ahead of the pack when it comes to contract lifestyle automation.
Your business runs on contracts. Improving your contracting capability will directly affect your business success and growth. Discover how Lexion’s CLM can help your legal team master contracts and drive business growth. Learn more about how we use AI to close deals faster or request a demo today!