Learn how organizations effectively manage routine contracts so crucial personnel can spend time on higher-value work.
What is contract tracking? 7 ways it helps your organization
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In a business world where routine contracts suck up valuable time and resources, an effective contract tracking solution can be a powerful way to let your business focus on the impactful, engaging work that matters.
How can tracking contracts do this? Let’s take a deep dive into where contract tracking fits into your business processes.
What is contract tracking?
Contract tracking refers to the effective monitoring of contract agreements through the entire contract lifecycle — from the initial contract request through negotiation, revisions, and enforcement. When done properly, contract tracking empowers stakeholders to more effectively execute, monitor, and comply with the terms within agreements.
What are the seven ways contract tracking can help your organization?
Here are seven ways contract tracking can give your organization an edge:
- Freeing up time and resources. Monitoring contracts and shepherding them through the process can take up hours of work. By tracking contracts through a contract management system, organizations can ensure time goes towards more valuable and strategic revenue-growing efforts.
- Boosting employee morale. Managing contracts is tedious work. There is a greater chance of burnout and turnover when these tasks take time away from valuable employees. With the automated assistance of contract tracking, professionals can focus on the high-value tasks they should be spending their time on — and companies can avoid the expensive chore of having to recruit and hire new in-house lawyers or expensive outside counsel.
- Keeping key individuals in the loop. In a lengthy contracting process, it’s easy for stakeholders to miss important steps. Contract tracking can make sure the people that need to weigh in on vital elements aren’t shut out.
- Staying on top of compliance issues. Tracking contracts ensures all parties remain in compliance. Effective tracking throughout the contract lifecycle allows all parties involved to know what they need to do and when they need to do it.
- Knowing about upcoming renewals. With contract tracking, your organization gets alerted to upcoming renewals well in advance. That means you have more time to plan — deciding whether to proceed, how to adjust budgets, where to shift resources, and much more.
- Getting a negotiation edge. When sitting down to negotiate, organizations need every advantage they can get. Contract tracking provides the insights and data from precedent agreements to inform your negotiating strategy and improve negotiation outcomes.
- Tracking the metrics that matter. Powered by artificial intelligence, contract tracking provides the data-driven edge an organization needs for efficiency, speed, and growth.
What does the contract tracking process look like?
The tracking contracts process might be a little different from one organization to another, but there are usually a few universal steps.
Once your organization has defined a contract tracking and contract management solution, it should:
- Define key stakeholders and decision-makers. First, figure out who needs to make critical decisions, and develop workflows and hierarchies through the contract lifecycle. Are there decisions that need to go to senior management, or can certain steps get approval from others?
- Assign responsibilities to tasks. Designate which people in the organization need to do key tasks — negotiations, drafting, revisions — to move the process along.
- Track contract versions. Observe evolution through the contract lifecycle to track amendments and other changes. Ensure everyone is operating from the most recent version.
- Monitor and report. The final stage involves data and insight. Check in on what the data says about your contract tracking process then report to the organization and adjust for efficiency.
What kind of contract tracking software do you need?
If your organization is ready to automate its contract tracking, what’s the right type of software to deploy? There are plenty of options out there. Be certain to prioritize features including:
- Robust reporting, with insight from artificial intelligence. Your solution needs to be all-encompassing. A lot of different solutions might offer AI capabilities. However, it’s the amount of data the software brings in — and the insights it can offer — that enable your company to chart a more efficient path.
- Human oversight. Remember, AI can only go so far. The best contract tracking software features a “human-in-the-loop” component to help do everything AI can’t do (yet).
- Easy integration and access. The last thing your organization needs is a piece of software adding more headaches and frustration. Contract tracking software must be easy to integrate within existing systems and easy to access and use for the people who rely on it.
- Real-time visibility. There’s no time to wait for critical tracking access and data. Your contract tracking system needs to supply real-time visibility into the contract lifecycle, distributing the information you need to keep the process moving.
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