Tom Odlin
Tom is a dynamic marketing professional passionate about legal technology and cryptocurrency. With extensive experience driving marketing strategies and leveraging cutting-edge tech innovations, Tom enhances brand visibility and engagement.
Table of Contents
Efficiency is key to staying competitive.
One area where many companies fall short is managing contracts. From creation to execution, contracts are often fraught with delays, errors, and inefficiencies, costing businesses valuable time, resources, and money.
This is where Contract Lifecycle Management (CLM) comes into play.
CLM is more than just a buzzword; it’s a powerful tool that can streamline your contract processes and deliver significant savings.
What is Contract Lifecycle Management (CLM)?
Contract Lifecycle Management refers to managing a contract from its initial request to its execution, renewal, or termination.
It encompasses every stage of a contract’s life, including creation, negotiation, approval, execution, compliance, and renewal. Modern CLM solutions, like Zegal, leverage technology to automate and optimise these processes, making them more efficient and less prone to human error.
Saving time with CLM
Time is one of a business’s most valuable assets. Traditional contract management methods often involve manual processes that can be time-consuming and prone to delays.
Consider the steps involved: drafting a contract, sending it for review, negotiating terms, making revisions, getting approvals, and executing the contract. These steps can involve multiple stakeholders and iterations, resulting in significant delays.
With a CLM system, much of this process is automated. Legal templates can generate contracts quickly, and automated workflows can ensure contracts move through the necessary stages without unnecessary delays. Additionally, e-signatures and centralised document storage mean that contracts can be executed and accessed more quickly, reducing time lags.
For example, a CLM system can automatically alert relevant parties when a contract is ready for review or approval, eliminating the need for back-and-forth emails. This automation speeds up the process and ensures that no step is missed, reducing the time it takes to finalise a contract from weeks to just days or even hours.
The facts
Businesses implementing CLM solutions report a 45% reduction in contract processing time, enabling faster deal closures and improving time-to-market for new agreements.
Resource optimisation through CLM
Managing legal contracts manually requires significant human resources.
Legal teams, procurement departments, and other stakeholders often dedicate a lot of time to contract-related tasks, which can distract from other critical business activities.
Moreover, the lack of a centralised system can lead to duplicated efforts, as different teams may work on the same contract without realising it.
CLM systems optimise resource use by providing a single, centralised platform for managing all contract-related activities, enabling more effective collaboration among all parties involved in the contract process.
Reducing manual effort and improving coordination between teams means that businesses can do more with the same number of resources.
In addition to optimising internal resources, CLM systems can help manage external resources more effectively. For instance, a CLM system can track contract compliance, ensuring all parties meet their obligations.
CLM reduces the need for external legal counsel to resolve disputes, as potential issues can be identified and addressed proactively.
The facts
Companies using CLM report a 30% increase in productivity within their legal and procurement teams, allowing these departments to focus on higher-value tasks.
Cost Savings with CLM
The financial impact of inefficient contract management can be substantial. Delayed contracts can lead to missed business opportunities, while contract errors can result in costly legal disputes or non-compliance penalties.
Moreover, the time and resources spent on manual contract management add up, further increasing costs, which is especially painful for startups and new businesses.
CLM systems deliver cost savings in several ways. First, businesses can reduce the labour costs associated with contract management by automating and streamlining contract processes. Second, the improved accuracy and compliance tracking of a CLM system minimises the risk of costly errors and legal issues.
Additionally, CLM systems can help businesses negotiate better terms by providing insights into contract performance and historical data, leading to more favourable pricing, better service levels, and reduced liability, all contributing to cost savings.
For example, a CLM system can provide analytics on contract renewal rates, helping businesses identify patterns and negotiate better terms with suppliers. It can also track contract performance, ensuring that businesses only pay for services that meet agreed-upon standards and avoid overpayments.
The facts
Organisations that adopt CLM systems see an average 25% reduction in overall contract management costs, including a 20% decrease in legal fees and compliance-related expenses.
Conclusion
By automating and optimising the contract process, CLM systems save time, reduce the need for extensive resources, and deliver significant cost savings.
Companies that invest in CLM solutions like Zegal are not just making their contract management more efficient; they are gaining a competitive edge that can drive long-term success.
Implementing a CLM system is a strategic move that will pay off in the long run.
