Legal teams handle volumes of contracts, with constant pressure to fit contract drafting, review, ensure compliance, consider liabilities and renewal clauses, and sign off all within the stipulated deadline.
Today’s legal professionals are struggling to keep up with the extensive flurry of activities in corporate legal departments, managing differing complexities while maintaining consistency and standards throughout hundreds or thousands of contracts. Naturally, contract management becomes an elaborate process for in-house counsels where GCs must fulfill the roles of advisors, advocates, and communicators across contracts. This is where legal tech enters in simplifying the day-to-day activities of legal teams and general counsels.
Advantages Of A Cloud-based Contract Management System:
Simplified contract management and automation- Instead of manually creating and reviewing contracts, AI-enabled contract automation quickens the processes of contract drafting, negotiation, compliance, and implementation. An end-to-end contract management software for GCs acts like a skilled lawyer who slashes the time required in manual contracting by leveraging the power of machine learning and automation.
Improves transparency of contracts- Different units in the organization can take a look at the contract status and communicate with the lawyers, breaking down the myths and jargon associated with legal teams. Both internal and external users get absolute clarity on the status of the contracts and the people reviewing/re-reviewing them, thereby improving contract performance with addresses in the initial stage.
Trendspotting with analytics- The data collected by the software enables general counsel to manage and enhance legal efficiency within a firm. Legal tech allows access to structured data and reporting to analyze contracts, current and past agreements, and other business data.
Advanced Tracking With CLM
Though general counsels majorly deal with the legal language, a lesser-known aspect of their work deals with numbers and other quantifiable data. Apart from boosting the contracting processes, GCs can dig deeper into the analytics offered by contract lifecycle management software and help organizations gain insights and improve in different departments of the business. Here are some ways General Counsels can improve contract and operational performance:
Contracting expenses- Keeping a tab on how much it costs to create, negotiate, and process contracts can reveal surprising values integral to the legal team. A dedicated contract lifecycle management solution can help assess the multiple variables that factor into the cost of a contract and lead to a dramatic reduction in contracting expenses. A survey across big and small organizations shows that the average cost of processing and reviewing basic contracts is rising, while costs for mid-complexity to high-complexity contracts reach thousands of dollars. This means tracking contracting expenses has become more important than ever for corporations and efficient businesses. For mid-sized companies, tracking contract costs can lead to significant savings annually.
Contract cycle time- Time is the second most valuable asset for legal teams, and more time required for contracting cycles means longer delays in closing deals. Measuring the time consumed by each step of the contracting cycle determines its efficiency and simultaneously suggests ways to improve the process. This also helps the legal team with a roadmap to focus their efforts and remove bottlenecks.
Quality of contracts- It is crucial to balance contract quality with quantity in order to ensure contractual obligations are successfully fulfilled. General counsels must ensure that all contracts adhere to the legal and industry standards by tracking deviation rates, contract risks, compliance, and error rates. In comparing different contracts or contract portfolios, legal professionals can identify patterns, trends, and areas for improvement for a higher contract renewal rate and contract quality.
Do the general counsels need a CLM? The long and short answer is yes.
The days of manual contracting and contract management are long gone. Adopting a CLM boosts legal team efficiency and improves business functions. With a contract lifecycle management solution, contracting becomes a data-driven, transparent, and collaborative process that works toward meeting business objectives. With the right tools like InkPaper, you can:
automate contract drafting and review with AI and LLM
collaborate with team members in real-time
improve contract execution with digital signature
analyze contracts with ease
set and measure KPIs for business growth