Contract management is an essential ingredient of a successful business. It should be the top priority of every business because it is integral to business operations. Apart from that, it also establishes clear communication between two or more parties and prevents disputes.
So in this article, we will talk about the contract management best practices so that you can maximize its results for your business. This will then allow you to input less work and benefit from more results.
What Are the 6 Contract Management Best Practices?
Contracts are an essential part of doing business, and managing them well can save you time, money, and legal headaches. So when it comes to managing contracts, there’s a lot to consider.
While there are many best practices for contract management, here are some of the most important ones:
1. Know your contract
This seems like common sense, but it’s important to know what you’re signing up for before you sign on the dotted line. If you don’t understand everything that is going on in the contract, ask questions until you do. Don’t be afraid to ask for clarification or ask for changes that would benefit your business as well as theirs.
2. Set up key performance indicators
Sometimes, KPIs are already set within the contracts. But for others, it’s not. The best thing you can do is set a separate KPI internally. This will help you determine the effectivity of the strategies you will be putting to place. That way, you can adjust them accordingly to meet the KPIs set in the contract agreed upon.
3. Set up an effective contract management system
A good contract management system will help you save time and effort by making sure all contracts are stored in one easy-to-find place. It should also allow users to easily create and edit contracts, send them out for signatures, and track their progress through the approval process.
If you are looking for a good contract management system, you can try out Fill. It gives you a lot of contract templates to choose from to streamline a step in the contract lifecycle. It can also notify you whether the contract is viewed, signed, and completed as well.
4. Put contracts on auto-renewal unless otherwise specified
Most people want contracts that are automatically renewed when they expire — unless they’re notified otherwise beforehand. Make sure your system allows for this type of flexibility so you don’t need to manually renew every contract every year.
5. Use templates whenever possible to save time and money
Templates make it easy for users to create contracts quickly based on existing templates with only minimal customization needed. At Fill, there are a lot of templates available for use. This help reduce errors by providing an easy way to set things straight before sending it for signature or review.
6. Automate contract expiration for you and the other party
When you automate contract management as a whole, you will be reminded of the boundaries that are both agreed upon by all parties. This means that you can pause ongoing works until contract renewal, if it will be renewed at all. You can automate it using the Workspace integration at Fill.
All you have to do is save the contract expiration on your Google Calendar as a reminder, and notify yourself via Gmail. Once the date arrives, you can notify your teams and the other parties as well.
Contract management should be a straightforward process, but in reality, it’s not. Human error, lack of communication, and forgotten files are just some of the challenges that plague even the best teams.
The key is to minimize mistakes by creating strong systems with simple procedures that are followed each time a contract is involved. Whether it’s better-defined roles and responsibilities or access points for all members using cloud-based contracts, there are best practices available to make your contract management process stronger and more efficient.
So make that change for your business today! Try contract management with us. Open your free account in Fill here.