Contract management software is a recent innovation in the information technology industry. The software aims to digitalize the storage retrieval of business contracts. The software enables better contract management and investigation of the lifecycle of each deal.
Factors to consider in the adoption process
Simplicity of use
The software you select should be simple to use in terms of convenience. The users of the software should be, however, willing to give a trial to the software to gauge the functionality. Also, the software needs to be compatible with the technology in your office. You can opt for various options from ContractSafe.
In the selection process, there is a need to ensure that the templates of the software offer accurate data. The features will enable to simplify the contracting process and save costs.
The flexibility of the system
Most contracts are not static and may require frequent amending. The software needs to offer an option for the user to create and assign various contracts within minutes. If you decide to renew the agreement, the software needs to have the capabilities to adjust the lifecycle of the contract.
Also, you need to select between a traditional or cloud-based software. The conventional type is installed on the computer while the cloud-based software you can access it through the internet. The two methods differ, and both have different implications in the business. For the traditional software, it is quite limited to the installed devices, while the cloud-based is accessible to all devices in the location.
Most contracts contain vital information about both parties. The information in various arrangements should be secure from unauthorized third parties. If you happen to leak such sensitive data, there are legal implications. Thus the software you opt for should offer robust security to prevent such mishappenings.
One key area to investigate is the access control of the software. The best way to mitigate the risk of access from third parties is to regulate the information each user can gain access to. The employees should only access the information they need to perform their tasks.
Also, the system should have a variety of security codes in addition to the passwords. Each employee should have a unique authentication code to log in to the software. The added security ensures that the system is not vulnerable to fraudulent activities.
Different software has varying holding capacity for their contracts; thus, it is up to you to select the one that best suits your company. For the software to be cost-effective, it needs to have a reasonable holding capacity.
The holding capacity in a more significant extent will also determine the price of the software. Thus it is crucial to look at the price and ensure that it is within your budget.
What are the functions of the contract management software?
Most businesses engage with various third parties in the process of doing business. Most professional engagements need the use of contracts to make any agreement legally binding. In the lifecycle of the company, you will sign many agreements with either the suppliers, customers, financial institutions or other third parties.
In ancient times most businesses did not engage in multiple contracts, and storing them in the cabinets was convenient for them. However, in the modern era, there is a need to adopt digital technology in the storing process and contract management software comes in handy.
Helps in the automation of administration
Automation of administration tasks mainly involves the use of modern software to reduce manual handling. The automation in the administration of the contracts enables efficient and productive handling of the arrangements. The contract management software will allow processing of the legal and business agreements in a better way.
The software enables centralized storage of all contracts. In a decentralized business organization, all employees can have access to all the agreements. Storing contracts in different locations will delay the retrieving process. It will also interrupt the operation of contracting.
Track changes on various contracts
Another essential use of contract management software is to track the changes in the contracts. Tracking of changes involves investigating the progress of the contract and ensuring the contractor is adhering to agreed limits.
Also, you can be able to establish the lifecycle of the contract. It is crucial to know the contract lifecycle of an agreement to investigate whether you need to terminate or extend the contract.
Advantages of the contract management software
Correct establishment of the expiry date
Most contracts have a specific lifespan depending on the agreement of the parties. Once the agreed lifespan expires, you should weigh the success of the contract and decide on the way forward for the deal.
But if you store the contract in traditional methods it is almost impossible to track the expiry date of the agreement. In such an event, the business will unknowingly extend contracts that might not be beneficial to the company. The software assists to eradicate such problems and assist you in tracking the expiry date correctly.
Saves storage space and time
Storing the contracts agreement on paper consumes massive space in the office. Adopting the software removes the needs of storing physical documents. All contracts can be retrieved from the various digital devices such as mobile phones, laptops, tablets and other devices.
Conventional contract management is tedious as the papers require filing, storing and manual management. The long process slows the contracting process and may generally slow the sale or buying of any agreements.
Most contracts have the same terms and conditions, and using the software enables the authoring of contracts. If you opt for the traditional forms of contracting you will end up drafting repetitive copies of contracts. You can make use of a similar template that is customized for contracting for similar agreements.
Adopting the contract management software ensures the process of contracting is cost-effective and efficient. The software is beneficial to both the contractor and contractee and both parties should be flexible to incorporate it into their organization. However, before settling for a specific software ensure you consider the key factors discussed above.