consolidation

Scanning documents isn’t helping you go “paperless”

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You know the drill: to avoid losing hard copy documents, you scan and store documents for future retrieval and sharing. Problem solved, right? You are on your way to a “paperless office,” right?

Not quite. Unless your company has a protocol for what to do with important scanned documents (and contracts definitely fall into that category), then you may be making things worse.

Run-of-the-mill document scanning devices and applications help clean-up the piles of paper on the desks of the finance and administration departments. But scanned documents filed away in a folder (nested in another folder, of another folder) or drive can be forgotten, “mislaid” and overlooked as easily as paper documents.

And that’s dangerous. Who has access to these sensitive documents? Are they being shared across unprotected networks? Also, not centralizing these documents can leave different parties making different changes to the same contract document. Imagine the headache when a note is not entered on a centralized record that notes an important “make good” a vendor owes you. One department says it is owed something from the vendor while another knows nothing about it – and bills as a result of that.

Some large enterprises try to get around this common problem with document retention policies. But more often than not, applying a document retention policy depends on how well your tools do the job for you.

This is one of the better reasons to consider contract management software. Contract Assistant, for example, eliminates file chaos by:

  • Providing quick and easy access to important information
  • Centralizing a place for all contract records
  • Linking to or actually storing electronic versions of paper documents
  • Generating standard and custom reports
  • Sending automatic reminders of critical dates and more

With Contract Assistant, at least for contract documents and records, you would know there is one place to go, one central repository of information that can then be used appropriately. We can’t guarantee Contract Assistant would help your company go “paperless” (that’s between you and your fleet of printers to determine), but it certainly will help your electronic filing chaos.

Three proactive ways to use contract management to save your company money

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For many who use contract management software, the benefits become quickly apparent. For those who don’t, however, it may be a little more difficult to picture. After all, “contract management” sounds like a way to file and store contracts rather than actively manage them.

Here are three proactive ways of using contract management software that underscore just how useful and even profitable contact management software can be:

Consolidate Duplicative Services

It’s not rare for a company to implement a contract management software system and then discover they are paying several vendors for the same or similar service. To stop that bleed of financial resources, look for an overlap of contracts you can consolidate.

A best practice to identify these opportunities is to categorize and tag contracts with customizable user-defined fields. Then, search and report on a specific category and begin to assess any patterns or trends of unnecessary coverage, overpayment, etc.

Example: Maybe you opted to purchase extended warranty coverage for new computer equipment your organization purchased earlier in the year. However, the contract you signed with an external IT services provider already encompasses ongoing service and support of the same equipment. Which contract offers more services for a lower cost?

Renegotiate Current Contracts & Agreements

If you’ve input critical dates into your system, a quick search will bring up the list of current contracts that need to be renewed—and therefore renegotiated—in the coming period. And if you are diligent in keeping track of related notes or events pertaining to each contract, you’ll benefit by building your case over time and reduce any last-minute scrambling for supporting information.

Perhaps you can reduce your cash outlay by negotiating a reduced subscription pricing plan or monthly fee schedule. Or, even maintain the current pricing structure, but enhance the arrangement by picking up an added service or benefit at no additional cost.

Example: Think about your personal car insurance rates. At times of policy renewal, many insurance companies are open to renegotiating rates with profitable, long-time customers, especially when presented with quotes from competitor insurers! And if a price reduction isn’t feasible, maybe the addition of complimentary roadside assistance will suffice.

Dates to Beware

And while on the topic of highlighting critical dates in your system, pay extra attention to note any re-enroll or renewal dates that automatically take effect. You want to maintain the flexibility to proactively decide whether to continue your contractual obligations or avoid being trapped with a vendor you no longer want to engage with.

Your contract management system should support reminder alerts to keep you informed of these and other important dates that can have far-reaching implications for your business. Just one miss of a brief period to opt out of an automatic contract renewal can be frustratingly expensive over months or even years.

Example: Mobile phone service providers are notorious for exploiting this tactic. Surely you know someone who didn’t take action after waiting months or more for their service contract to expire, only to be looped back in for another two years. Ask them about the personal ramifications of that mistake and then amplify it to a magnitude relative to the scale of your business. Ouch.