Storing a contract and its addendums wherever you like - whether it’s for convenience or because your organisation works in silos - is the first major step in failing to realise expected contract outcomes.
Contract storage should be proactive and strategic. Knowledge of where your contracts are, what they involve, what actions are due and if there are any risks present will help you to make meaningful decisions at the right time."
In this article, we’ll outline why taking the right approach to contract storage is so important, how it benefits your business and why your business should consider a digital contract storage solution.
Common contract storage challenges
Contract storage is often treated as a passive act of storing agreements away somewhere. Sometimes, they can be stored anywhere - without all parties knowing the location. We hear this from a wide variety of businesses - whether they’re a start-up or an established enterprise - and the same challenges are commonly cited.
Businesses managing contracts through a combination of spreadsheets, email, shared drives and even verbal agreements often find themselves trying to manage chaos. This causes frustration within teams and across business units - with the contracting process taking far much more time and effort than is really required.
If your business is taking manual, fragmented approaches to contract storage, don’t be surprised if it runs into issues including:
- Low visibility of the agreements and their key terms and dates
- Repetitive administrative tasks that distract teams from strategic work
- Poor version control of agreements
- Limited understanding of what obligations are contained in the contracts
- Instances of non-compliance as crucial documents expire without anyone knowing
Businesses that are scaling quickly, have a large number of suppliers or have complex, geographically-dispersed teams feel this frustration even more keenly. And as we head into a period of economic turbulence, poor contract storage methods could lead to a set of wider problems that will impact businesses further. These may include:
- Missed renewals causing revenue leaks
- Valuable business hours being lost to contract administration
- Non-compliance and audit failures leading to costly fines and litigation
Having a standardised, digital approach to contract storage helps businesses to resolve a lot of their existing challenges and minimise financial risks in the future.
What does best practice contract storage look like?
Best practice contract storage is having your complete, up-to-date records in a single, secure contract repository. Relevant stakeholders with the right access permissions should be able to access the information they need from wherever they are. They will also be able to access a complete, auditable history of any actions taken against each contract record so they have a single source of truth.
Best practice contract storage, to put it simply, is digital.
Using dedicated software to improve and centralise your contract storage will put your business on a better path to improving visibility and compliance across its portfolio. Let’s take a look at how best-practice contract storage can be supported by contract management software.
1. Improved contract visibility and secure accessibility
Contract management software, such as ContractNow, offers a digital repository. All agreements are stored in a single, secure location. Any additional information relating to the agreement - whether it’s a security certificate or another addendum - can be attached to the Contract Master Record via a parent-child hierarchy.
See everything in one place with ContractNow
Accessibility is immediately improved, with stakeholders being able to locate up-to-date records from any location or device when the right permissions are set. Teams working remotely, on-the-move or who need to find information quickly can all benefit from digital contract storage.
Centralising up-to-date records and making them accessible to relevant colleagues builds a single source of truth, boosts visibility and helps teams to work together effectively."
2. Greater internal efficiency through powerful search capabilities
Contract management software pairs a centralised repository with powerful OCR technology. When using ContractNow, stakeholders can search for the agreement they need within all documents.
This search can be carried out from across the entire platform and will return results that are defined by the contract, counterparty or file name. Each contract is also tied to the owner, making collaboration much easier.
OCR technology saves businesses hours of time
By digitising contract storage, businesses can save valuable hours that otherwise would have been spent locating an agreement, tracking down missing information or even liaising with internal colleagues. This reduces contract administration and low-value tasks, allowing specialist teams - particularly in-house counsel - to focus on their strategic purpose.
Internal efficiency is just as much about working accurately as it is quickly. When everyone can find the information they need, business decisions can be made in an instant."
3. Proactive renewals management with key dates to hand
One of the biggest problems with manual contract management is that you can’t know what you can’t see. So when key dates such as contract renewals are buried in inboxes or spreadsheets that never get checked, important events can pass by without anyone knowing.
Receive reminders for upcoming renewals
By prioritising best practice contract storage with a digital solution, stakeholders can easily see key dates. More importantly, they can strategise them. Key dates can trigger automatic notifications to contract owners, letting them know a renewal is due and giving them time to build in the necessary contract review.
Missed auto-renewals lead to revenue leaks, making it harder to recession-proof the business in the coming year. Centralised contract storage and using key dates to drive action is vital to avoid this."
4. Compliance proven by a defensible history
Businesses that work within regulated industries cannot afford the risks heightened by manual contract management. Fragmented ways of working, poor version history and an inability to find crucial data increase the risk of non-compliance. Ramifications can be quite serious including disruption to business operations, expensive fines and audit failures.
By approaching contract storage with a digital solution, these issues can be negated. We’ve already mentioned that agreements and their relevant documents are stored in a secure, accessible area.
ContractNow goes one step further by building a complete history of all actions taken against a record - with a name, time and date stamp to drive accountability.
Contract storage needs to account for every version of an agreement. Trying to manage this manually can lead to providing auditors with conflicting information."
The importance of using a dedicated CLM solution for your contract storage cannot be overstated. ContractNow provides a secure, efficient, and accessible way to store and manage contracts, improving visibility, searchability, renewals management and compliance.
By taking a digital approach to contract storage, businesses can save time and reduce low-value work. Business decisions become more proactive, have greater accuracy and will help stakeholders to realise the full value of their agreements. If you’re ready to improve the visibility of your agreements, get in touch with us today.