Best Contract Management Software

What is Contract Management Software?

Contract management software refers to the process of managing the complete contract lifecycle. This includes all the steps in the business process management process, including the creation, execution, and analysis of the contract. A contract officially documents the terms and conditions that two companies agree upon when doing business with each other. It legally binds two organizations two to fulfill their parts of the agreement. 

Contracts go beyond managing dealings between two companies. They also apply to freelancers, employees, partners, vendors, stakeholders, and more. Companies need to create and manage different contracts based on the purpose. This can prove to be time-consuming, resource-intensive, and costly. 

Furthermore, errors in contracts occur frequently. Not understanding your client's requirements, missing out on important boilerplate clauses, making the contract too one-sided, and typing mistakes are common in contracts. While these errors may sound insignificant, they can cost you thousands of dollars. 

This asks for effective contract management software procedures that help speed up your contract management process while reducing costs and increasing efficiency. Here's where contract management software comes into play. These solutions enable you to manage and oversee all your contract processes from one place. 

A contract management system automates redundant contract management processes, such as drafting the contract, enduring proper formatting, getting approvals, keeping up with amendments, and more. It also comes with a contract database that allows you to store all your contracts on the cloud and access them from any device. These databases have search capabilities that allow you to find any contract within seconds. 

However, implementing a robust contract management solution or hiring contract management professionals isn't enough. Employees must augment themselves with the software, technologies, and processes to satisfy the ever-changing analytical and compliance requirements. 

When organizations successfully blend contract management technologies with the right employees and skills, they can expect to see the following developments:

• Realization of financial returns and business benefits

• Increased cooperation and responsiveness to your needs by the supplier

• A substantial reduction in contract disputes and errors

• Improved speed and quality of service delivery

• Increased satisfaction among both parties

What Are the Benefits of Using Contract Management Software?

Contracts are the cornerstone of conducting business in many industries. Therefore, having an effective contract management process is crucial. Let's look at how using the best contract management software can improve your contract management process. 

1. Speed Up the Process

Contract lifecycle management software automates all administrative contract management tasks, shortening approval times and making the process faster. You can customize automated workflows per your requirements to make the process more efficient. Most contract management software systems come with a dynamic workflow to-do list functionality that helps you track your contract management workflows better. 

2. Improve Control

Contract management solutions come with a centralized portal that enables you to manage all your tasks and processes from one place. You can access functionalities like audit trails, contract history, and compliance information within seconds. This way, you'll be able to get complete control over your contract management procedures. 

3. Increase Contract Visibility

If you're still relying on paper-based contract management systems, the chances are that you're spending more time and resources than you should. But more importantly, paper-based manual lead management to improper storage and organization of contracts, which can affect contract visibility.

Contract management solutions resolve this hurdle. You can store all your contracts and related information in a centralized contract repository. This improves contract access as anyone in your team can find the needed information easily and quickly. Moreover, if your system is cloud-based, you can find the desired information from any device. This goes a long way in increasing contract visibility and overall process efficiency. 

4. Ensure Contract Compliance

As a business owner, ensuring contract compliance is probably one of your top priorities. The best contract management software can assist you with that. It streamlines the entire process from request to approval, ensuring it is in line with the compliance standards. 

Furthermore, many modern-day contract management systems integrate seamlessly with solutions like MS Word to ensure contract compliance without disturbing your workflow. This allows the concerned individuals to create and edit documents as needed while enabling consistent contract compliance. 

5. Keep Up with Renewal Dates

If you recently missed a contract renewal date, you're not alone. Business owners and other senior executives have so much on their plates that losing track of contract renewal dates is only normal. However, it can hurt your business in many ways. 

First, a missed contract means a lost client, which in turn means lost revenue. And if you miss contract renewal rates too often, these revenue losses can pile up. Second, it deteriorates relationships with clients, which can impact your ability to do business in the long run. 

Contract management software ensures that you never miss a renewal date. These solutions come with a built-in calendar and alarm configuration functionality. You can set alarms for renewal dates to get automatically notified. You can also assign team members to ensure the right action is taken. 

6. Streamline Document Management

Managing documents is an essential part of the contract management process. However, it's certainly not the most enjoyable, and in some cases, it can be tedious and prone to errors. Paper records are prone to damage and theft, making contract management even more challenging. 

Contract management software solutions enhance the document management process. You can directly scan paper documents and store them in cloud storage as an image or PDF. And since the docs are stored in the cloud, you can access them whenever and wherever you want. This way, you can eliminate the messy documentation process and spend more time on work that matters. 

7. Reduce Risk

Contracts can be risky. A slight deviation from the recently updated compliance standards can cost you thousands of dollars. And when it comes to contract management, businesses need to take care of too many regulations, policies, and standards. Keeping track of them can be challenging, and failing to comply with them can hurt your business.

Contract lifecycle management software can make your life easier by reducing the risk. These solutions standardize the contract management process. This reduces unexplained expenses and supply chain risks, making the entire procedure less expensive and more valuable. 

Additionally, contract management solutions come with certification and validation tools that facilitate seamless supplier onboarding. You can easily identify contracts based on suppliers. Furthermore, you can segment contacts based on high-risk zones, natural disasters, political unrest, and economic uncertainty to manage your risk better. 

8. Optimize Your Finances

When you have multiple contracts to manage, unplanned renewals can occur. Too many unplanned renewals can increase operational expenses and hurt your revenue and profits. Contract lifecycle management software helps you eliminate such undesired renewals. Not only does this enable you to reduce costs, but it also increases spending visibility. 

This way, you can save more money. Ideally, companies that link their sourcing and contracting operations save more. When you use contract management solutions, you purchase the right quantities from approved suppliers at the right time. It reduces unwanted spending and optimizes your finances. 

9. Increase Productivity

Lastly, a robust contract management system can make your workforce more productive. These contract management tools have advanced reporting and data analytics capabilities, enabling accurate forecasting. This reduces the risk of errors and makes the contract management process more efficient. 

Moreover, the best contract management software automates most redundant administrative tasks, such as document and compliance management. This frees up employees' time, allowing them to focus their time and energy on work that matters. As a result, your employees become more productive and contribute to the organizational goals. 

Who Uses This Contract Management System?

Any individual, team, or department in an organization that creates or manages contracts can use a contract management system. This includes everyone from business owners and senior executives to sales agents dealing with clients and customers. 

Let's look at how contract management software fits different organizational roles. 

1. Business Owners

As a business owner, you must've signed at least one contract in your lifetime. Then, you might already realize how tedious it can be to prepare contract documents, ensure compliance, save and organize contracts, and more. 

Contract management can take away a significant share of your time and resources if you handle multiple contracts. Contract management software makes your life easier. Business owners can use it to streamline and automate the contract management process and save more time and energy. 

2. Senior Executives

Like business owners, senior executives also spend a significant share of their time exploring new business opportunities. For example, a CEO might be in talks with another company's CEO about procuring raw materials for production. Similarly, a chief marketing officer (CMO) could be looking to outsource some of their tasks to offshore agencies. 

All these procedures require the creation and management of contracts. Senior executives can use contract management software to automate the contract management process and focus on more important tasks. 

3. Human Resources (HR) Teams

HR teams need to create and manage employment contracts on a daily basis. Almost every organization has an employment contract policy highlighting the terms & conditions and rights of both the employee and the employer. HR teams can leverage contract management systems to streamline employee contract creation and management processes. 

4. Sales Teams

Sales teams are always in contact with potential and existing customers. Hence, contracts are an essential part of their job. As soon as a customer agrees to come on board, signing a contract is one of the first things they need to do. Sales teams can utilize contract management systems to speed up the contract lifecycle and provide a better onboarding experience to customers. 

5. Legal Teams

Managing contracts is an essential part of the legal workflow. Legal teams must spend a great deal of time creating, renewing, and managing contracts. Contract management software systems can help legal teams manage their contracts more efficiently and become more productive. 

6. Finance Teams

Finance teams must keep up with all the existing contracts and contracts in the pipeline to ensure they're in sync with the company's policies. These teams are also responsible for measuring and calculating the financial risk associated with each contract. Contract management systems help financial teams better track and manage all the contracts, conduct audit trials, and reduce potential risk. 

Market Size of Contract Management Platform in the USA

The global contract management software market was valued at $1.5 billion in 2019 and is projected to reach $2.5 billion by 2025. When it comes to region-wise segmentation, the USA was the leader in terms of market share and growth. The contract management software market in the USA is likely to exhibit a CAGR of 10% through 2025. 

Several factors have contributed to the growth of the US contract management platform market. Let's discuss them in brief. 

• Rising demand for contract management technologies and services to manage the increasing number of contracts cost-effectively. 

• An influx of investments by key US players pushes the country's contract management software market.

• The development of contract management technology and enterprise management solutions

Furthermore, the market is divided based on the deployment mode, organization size, and industry. Let's discuss these segments. 

1. Mode of Deployment

Regarding deployment mode, the contract management software market in the US is segmented into two parts – on-premise and cloud-based. 

An on-premise contract management platform is deployed on the organization's systems. This provides complete control and increased data privacy and security. However, on-premise systems lack mobility, which has become crucial in this remote work era. Cloud-based solutions resolve this hurdle. They are accessible from any device and location and, thus, are gaining significant popularity. 

2. Organization Size

Based on organization size, the market is divided into two segments – small and medium enterprises (SMEs) and large enterprises. Most large enterprises already have contract management systems as standalone solutions or combined with other enterprise resource planning capabilities. Therefore, the large enterprise segment will not likely witness much growth in the forecast period.

On the other hand, SMEs are new to the concept of digital contract management. The rate of contract management solutions adoption among SMEs is rising, and this trend will likely continue in the upcoming years. The need for risk mitigation, reducing compliance risk, alleviating unnecessary expenses, and producing favorable outcomes are some reasons for the widespread adoption of contract management solutions among SMEs. 

3. Industry

Companies in almost all industries use free contract management software solutions; however, the implementation rate is high in certain sectors. These include the healthcare system, IT, telecom, and BFSI. 

The healthcare sector is the leading adopter of contract management software in the United States. The global healthcare contract management software market is projected to reach $2.82 billion by 2027, with the US showing the highest growth along with Europe and Asia-Pacific. This growth can be attributed to the increasing demand for technology-based solutions to streamline hospital contract management workflows. 

4. Key Players

Some major contract management software vendors in the US are Apttus, Aaveneir, Agiloft, IBM, ContractWorks, Conga, CLM Matrix, Concord, CobbleStone, and more.

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