Regardless of the industry or niche a business/company may serve, contracts are a major component of daily operations. Created for business partnerships, labor, vendor transactions, customers and more, contracts almost demand that they be managed in the most efficient way possible.
Here are some statistics to consider:
- Goldman Sachs estimated that companies spend almost five-percent of their revenue to track agreements after signing a contract.
- PricewaterhouseCoopers found that 12-percent of a company’s total annual costs may be devoted to contract management and administrative tasks.
Taking this into consideration, it’s easy to see why there’s a case for contract lifecycle management software. If that isn’t enough to convince a company that it may need to consider a contracts management software implementation, there’s this:
- Goldman Sachs also reported that companies using contract management software can reduce annual contract management expenses by 20 to 50-perent.
- The Aberdeen Group has found that best-in-class companies average 85-percent of purchasing transactions compliant with contracts compared to 30-percent for all others. It has also found that best-in-class companies have more than 75-percent of their contracts in a “searchable repository” – while others have contracts in a searchable repository only a third of the time.
What does all this add up to? Contract management software is a no-brainer if an organization wishes to lower costs and improve how it creates and manages an end-to-end digital document.
Let’s now take a look at some of the ways contract management systems are cost-effective and provide genuine value.
- Loss Prevention – Poor contract management causes organizations about 9.2-percent in losses every year, and, as a result, implementing a contract management system can improve processes, reducing loss up to 50-percent.
- Renewal Negotiation – Renewal contracts are as important as new contracts, and with a solid contract management lifecycle, a company can get all the data it needs to create and negotiate the terms for renewal in an efficient fashion.
- Sales Operations Optimization – Having the right contract management software within an organization can help reduce the sales cycle, making the entire process easier, resulting in more sales by investing less time and resources; based on our estimations, this means a savings of 20-percent in operation costs.
- Legal Operations Optimization – A contract management software system significantly reduces the time invested by the legal department in CLM, meaning the team can now invest their time and efforts in operative tasks that used to be outsourced.
Contract management software systems have completely changed the way many enterprises conduct business. To learn more about the way iQuantum is getting on board with the digital transformation, contact us today.