Many companies only deal with vendor contracts at two times: in the rush to get a contract signed and vetted before it goes into effect; and at the end of a contract when questions come up on renewal and effectiveness.
Once the contract receives proper approval, is signed by the involved parties, and the agreement terms begin, what happens after?
Typically, paper contracts get filed in filing cabinets lining office hallways; electronic contracts get saved to folders buried deep on a network drive. In the best-case scenario, whoever manages contract administration in the organization has a running spreadsheet of contracts and some of the related information
The problem is that this information becomes locked away (sometimes literally) and even in spreadsheet format, becomes user-unfriendly.
Fast forward to a contract’s end date. Did the vendor fulfill the contract fully, as stipulated? Did they meet certain deadlines or time-related requirements? Did anyone even track if this happened? What about over all cost of services over time? Did administering the vendor’s services require more internal staff time than anticipated?
This can cost any organization time and money in the long run. This is where contract management software really pays off. Consider just the basic functionality that Contract Assistant has. By centralizing key contract information and tracking it over the period of the contract, your company will know what the true cost was, or how efficiently the vendor fulfilled their obligations.
Here are six key ways contract management software does this:
- Creating a complete electronic record and decreasing risk of misplaced documents
- Setting alarms to prevent missed deadlines and unwanted auto-renewals
- Conveniently storing a contract abstract and notes
- Allowing users to create fields and user-defined pull-downs to tailor contract management to specific needs
- Tracking and reporting of summary financial data via financial summary fields & monetary key elements
- Making contract data searchable – thus saving time
The point is that if your organization is reviewing these kinds of questions only at the end of a contract, you really aren’t making an informed decision. Instead, you are relying on “institutional memory” (usually one person!) or just general sentiment to decide on that renewal – and on what terms. Doesn’t it make sense to consider contract management software? If your organization wants to be more efficient, and make better decisions, it’s an option that cannot be overlooked.