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01 March 2022 ·

Three essential tools for digital contract management

 

Legal operations are consistently evolving with a greater embrace for digital transformation and legal professionals are stepping into the new era of Contract Lifecycle Management (CLM).  CLM involves three software tools: contract artificial intelligence, online document collaboration, and speedy electronic signatures.1 Here's what these three solutions mean and how they work together to give results you need as you face today’s demands that you continue building smarter solutions for your clients.

First – use contract artificial intelligence

If your organization manages a high volume of contracts, you could miss out on gaining transformative insights if you do not know how to automate processes and optimize (CLM)2 by using machine learning. Artificial intelligence (AI)3 is crucial for your contemporary contract management strategy which can support:

  • intelligent data extraction;
  • proactive opportunity realization;
  • comprehensive risk mitigation;
  • continuous machine learning; and enhanced contract oversight.

Organizations seeking to improve data extraction should use contract automation intelligence. Natural language processing (NLP) within a contract AI engine supports data pre-processing; automated data extraction; and automated data fill of important information existing within centralized contract records.

Contract document clause detection enables contract management software users to compare newly introduced clauses with clauses existing within their organization's pre-approved clause library. Text from new clauses can be added to training data for consistent machine learning. This improves data entry recognition and output speed. Robust contract management software with contract AI can intelligently classify clauses in accordance with an organization's clause types and present a percentage score that evaluates the accuracy of the applicable categorization system being analyzed.

To further optimize contract data management, organizations can configure rules for the security of data points identified as sensitive. This process establishes data security parameters while simultaneously consolidating and classifying sensitive data.

Contract AI also makes it easy to create contracts from a document. By using drag and drop record initiation with trusted contract management software -- system users can import many file types – such as Microsoft (MS) Word documents and Portable Document Formats (PDFs). After that, a record type can be chosen to create records with one click of a button. Users can enjoy seeing their contract data from their documents intelligently mapped into an easily navigable contract record.

Future-minded contract software supports intelligent workflow automation for task performance analysis and monitoring. Workflow analytics and alerts increase visibility, and contract intelligence helps teams identify contract lifecycle bottlenecks and anomalies within their contract workflow4 processes. These vital tools can help reduce contract lifecycle inefficiencies.

Finally, contract intelligence can positively transform organizations' approaches to risk management. Risk rating and mapping features of contract artificial intelligence can foster digestible insight into contract risk. Intuitive contract risk graphics - such as a risk assessment matrix – can present risk probability patterns and risk exposure. Such granular yet easily comprehensible risk visibility can help contract professionals quickly make informed risk mitigation decisions.

Second – control online document collaboration

Online document collaboration and assembly is one of the cornerstones of digital transformation for legal operations.  Unless done correctly, CLM bottlenecks can arise.  You need to use a centralized process during contract assembly and follow the procedures involving the secure drafting, negotiation, storage, and location of contract documents and data.

An efficient way to edit and collaborate on contract documentation online is to use an online document editing interface to centralize the creation and collaboration efforts within one integrated platform. Trusted contract management software platforms support various online document editing options for enabling organizations to streamline CLM processes.

Leading-edge contract management software provides native tools for enhanced online document editing to allow contract management software users to:

  • create new documents from an established contract management software record info page;
  • import new documents into an established record info page;
  • edit existing documents from an established record info page to maximize data clarity and minimize misinterpreting the data.

If more challenging or diverse options exist, you can use familiar online document editing integrations to streamline processes and enhance contract software usability. For instance, leading contract software solutions offer seamless integrations with Google Workspace and MS Office 3655 to edit documents online with enhanced governance and versatility of collaboration.

When using these document editing tools organizations must organize their contract documents carefully by tracking (clearly identifying) all contract versions so that any incorrect or incomplete versions of contract documents are not mistakenly used throughout the contract lifecycle.  If this happens, you could encounter harmful errors, overlooked obligations, incorrect contract clause language, breaches of contract, and other damaging consequences.

Thankfully, leading-edge contract management software can support organizations' efforts to track contract documents. By using automated and numbered version tracking and robust audit trails of contract documents, contract management teams can stay abreast of contract document versions with an elevated assurance that clauses, sections, and portions of contract language are current, accurate and accounted for.

Online documents, contract data, sensitive information, and other mission-critical contract management software assets can be safely stored in a secure repository within contract management software. Contract management teams can centralize the storage and location of contracts, templates, clauses, contract data, and much more – storing it all in one, unified area by leveraging a secure repository within a leading CLM system. A contract management software platform with security accreditations such as SOC 1, SOC 2, HITRUST, and Privacy Shield compliance6 can keep assets within an organization's secure contract repository not only easily accessible but safeguarded as well.

Configurable reports, dashboards, calendars, and robust yet user-friendly search capability can increase awareness, efficiency, visibility, and accountability. Contract management software users can quickly locate contract record pages, contract documents and attachments, clauses, key data, and other information within their centralized system.

Third – use an electronic signature tool

E-signature eliminates time-consuming paper shuffling and collecting signatures required for a contract can be a daunting task especially when you work with multiple signatories from a vast array of locations. Contract signatures finalize contracts and propel contract execution. As such, this critical CLM stage should not be delayed paper processes and other tedious and delay-prone methods.

Instead, why not embrace digital transformation by including an electronic signature (eSignature tool) within your CLM software? Best-in-class software offers a quick way to promote signing and executing contracts to cut your send-to-sign time by up to twenty percent to keep your customers, partners, counterparties, vendors, and employees happy.

An eSignature tool within CLM software allows you to sign either in the office or on the go with virtually any device that has suitable internet access. To make electronic signatures even more robust, leading contract management systems offer a CLM software mobile app for electronic signatures.  This app is a key differentiator in contract management digital transformation allowing organizations to gather signatures for necessary stakeholders in record time with diversified signing options.7

Trusted contract management software platforms offer digital signature certificate options that can secure a signature's date and time to effectively demonstrate that the signature remains secure (untampered with).  This will decrease the need for a licensed notary.

Robust contract lifecycle management software can support organizations by digitally inviting stakeholders to add signatures -- including via email -- to documents within a secure electronic signing portal. To further keep signing safe, secure, and direct, organizations can restrict invited signatories' access to irrelevant or proprietary information within the CLM system.

Organizations can send electronic signatures for contracts, requests, bids, purchase orders, policies, and more. Even participants who do not use electronic signatures can keep the process moving with the ability to quickly sign manually. Signing parties can quickly electronically sign from their internet browser without the need to download additional software or applications.

Organizations can even send tens, hundreds, or potentially thousands of documents for electronic signatures in mass. Manual processing for bulk signatures – such as bulk addendums, HR documents, policy updates, and new agreements -- can be eliminated by using leading contract management software instead.

Organizations using leading-edge contract management software for electronic signatures can store and retain signed documents within a secure online portal that provides end-to-end status tracking and oversight of partially and fully executed documents. Organizations using particularly robust CLM software systems can leverage their existing licenses to connect with leading electronic signature platforms.

Enjoying CLM Contract Management

As a CLM software user, you can enjoy:

  • an automated and streamlined contract request process.
  • simplified contract authoring with the automated merging of contracts with templates from your pre-approved clause library.
  • a central process for contract negotiation, collaboration, and contract review.
  • swift and intelligent contract approval routing.
  • speedy electronic contract signatures.
  • contract obligations oversight with intelligent workflow automation, key date awareness, task alerts, milestone tracking, obligation status reports, system dashboards, and more.
  • contract compliance management for terms and conditions, general and field-specific rules, regulations, guidelines, and more.
  • contract renewals mastery with helpful automated calendar and dashboard reminders for upcoming renewal dates and opportunities, easy searching within a secure contract repository for contracts up for renewal, robust audit trails, robust contract analytics tools, and more.

When you embrace legal operations’ digital transformations you get innumerable benefits by using a leading contract management software platform that offers

  • contract intelligence;
  • online document collaboration and assembly; and
  • centralized electronic signatures.

Your organization needs a CLM system to launch all its stages effectively. Which means you use reliable CLM software to manage the contract lifecycle accurately so that software users can tackle each stage of the contract lifecycle – from contract requests through contract renewals.

Our vision?

We want you to confidently enter and excel in the age of legal operations digital transformation with increased return on investment ROI.8  But, regardless of which software app you select, you can experience all the benefits stated above which are just the tip of the iceberg.  There’s much more out there!   

ABOUT THE AUTHOR

As a Content Marketing Manager, Sean Heck partners with company leadership, subject matter experts, and sales to develop engaging digital marketing campaigns and related content that includes client success stories, collateral, blog articles, press releases, videos, social media, presentations, and web copy. He is passionate about promoting brand awareness and creating engaging content to maximize clients’ goals.  His specialties include digital marketing, project management, content creation, communications, planning, listening, organizing, and networking. 

ABOUT COBBLESTONE SOFTWARE

CobbleStone provides contract, vendor, and e-procurement management software used by hundreds of organizations worldwide. This cloud-based or deployed (on-premise) organization provides a platform that hosts over 3 million contract transactions and billions of dollars in contract value. This involves Software as a Service (SaaS), which is longer than any other contract platform. Their goal is to provide the most advanced, cost-effective, and user-friendly contract and procurement management software applications that enable employees to do their best work.

END NOTES

  1. Contract Management Software and Sourcing Solutions
  2. Contract Lifecycle Management (CLM) (See also World Commerce & Contracting’s Commitment Matters blog.)
  3. Contract artificial intelligence, Cobblestone definition
  4. Contract Automated Workflows Cobblestone definition
  5. See also Microsoft 365 Versus Google Workspace: Which is Right for Your Organization, Matt McDermott, published by Spanning, a Kaseya company, November 26, 2021.
  6. Ref. sources:

    o     What’s the difference between hitrust and soc 2 certification? by RSI Security December 4, 2020 (HITRUST blog category). 

    o     HITRUST Soc 2 Executive Briefing

  7. See Cobblestone’s Electronic Signature Software demo and an example of Cobblestone Software Mobile App.

  8.  

    Cobblestone’s ROI software calculator.

     

     

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Sean Heck
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