A contract management solution (also commonly referred to as contract lifecycle management) is the best way for large and small businesses to manage contracts fast and effectively.
The software eliminates the problems of slow, time-consuming contracting processes and offers business the advantages the modern digital world.
Instead of awkward emails and in-boxes, contracts are organized into neat database for better accessibility and control.
Now that you’ve made the decision to improve contracting routines you know there is significant benefits including: save time, and increase speed, and better control of costs, assets and obligations.
There’s only one thing standing in your way: you must choose a vendor.
Which software best suits your needs? What makes one vendor a better choice than the another? What are the criteria for a successful vendor relationship?
There isn't a magic answer, but we offer the following tips to aid your selection process. Use these questions to help you shorten your decision-process and improve outcomes.
The goal is to identify the partner who will generate the biggest value for you both at initial implementation and as your business evolves.
1. What is the vendor's profile?
These software review sites help you quickly do a high-level evaluation of vendors and their market strategy. From there you can make a list of potential vendors to explore in more detail.
Some of the factors to consider at this stage are:
Size: Does the software provider build products for businesses your size? If you are a SMB in Europe, then software targeted at US Enterprises is probably overkill.
Geography: Is the software designed for your market? Security, compliance and other factors are important. For example, contract data must be stored on servers according to regulations.
Industry sector: Is there a contract management system developed specifically for your industry? For example, real-estate? Many vendors have developed products to fit unique requirements because a one-size fits all approach doesn’t work. You want to make sure these companies are considered as part of your evaluation process.
2. Is the contract management software focused on buyer-side or seller-side contracts?
Next you should check whether the software provider focuses on buyer-side or seller-side contracts.
Who will be using the system? Get a clear understanding of their needs and involve them in your evaluation process.
In general, buyer-side contract management software is designed for procurement departments, contract managers, finance teams and other people who are interested in managing expenditures.
Supplier-side software supports sales, revenue management, and other processes related to selling goods and services.
(Note: Subscription Management software is specialized for businesses selling of recurring revenue contracts)
3. Which steps of the contracting process are covered by core features?
Some vendors focus on contract creation process (pre-signing), while others focus on managing and following up contracts once they are signed (post-signing).
It’s difficult to find a vendor that is good at everything. If they claim they are, that is reason to be suspicious.
Which stages of the contract management process are most important to your users? What features do vendors offer to support those stages?
You can use this list to identify the functions that are important - and those you can do without. There is no point in buying a complex system if you don't need it.
- Drafting – gathering text, images and all the contract details
- Reviewing - commenting, editing and tracking comments
- Collaborating – obtaining approvals and managing workflows from contract draft through to signing
- Send agreements swiftly for signature
- Authenticate signers with electronic ID
- Range of signing options
- Monitor signing process
- Communicate with counterparts during signing process
Contract storage and data management
- Store, search and find contracts
- Archive contracts and track revisions
- Manage contract data, dates, counterparts etc.
- Manage users and access rights /roles
- Integrations – if contract management should be synched with other process
Dashboard reporting & follow-up
- monitor incomes and expenditures
- manage renewals
- notify users when contracts should be terminated
- reporting contract values for accounting and finance
4. What localizations are available?
Local rules and regulations are important to contracting. Is contract data stored in the EU or other locations?
Check also the signing process support eIDAS, EU regulations and local eID in the countries you operate. At first glance it may seem like a solution can ‘work anywhere’, but that may not be the case if you dig deeper into local legislation.
5. What is the implementation process?
How will you import contracts and onboard users?
Most people appreciate the value of a contract lifecycle management tool but wonder how they will collect and register contracts in the system. That is the first hurdle a vendor should help you over – and they should offer a range of options.
Is there a way to scan contracts and automate the contract registration process? Does the vendor have experts who can take care of registration for you?
A potential partner should be able to walk you through the implementation process and give specific examples of how they ensure your ongoing success.
6. What is the price?
The ideal contract management solution will grow with your business, and not break the bank.
The pricing model may be based on number of contracts, storage space, number of users, number of signatures etc.
In any case, look for clear and transparent pricing, without hidden surprises.
7. how is the support level?
Before buying any contract management software, check what support options are available. No matter how well software is designed, there will be a time when you need assistance.
Is there comprehensive online support? Does the software include chat and videos? Is there service in the time zones that are relevant? Maybe you need an extra service level?
At some point, you may also want a partner that offers more than technical support. Can you have direct contact with a consultant when you are curious about best practices?
8. Who are You buying from?
First-class data security, constantly improving functionality and good customer support are what creates long-term customer growth.
How solid are the finances of the company selling you your solution? Are they backed by solid owners? Always partner with a company that has a long-term perspective.
Don't forget References
Once you have made your shortlist – remember to ask vendors for a product demonstration and customer references.
A customer who has recently implemented contract management software will be able to tell you what went well – and what didn’t. This is one of the most important checks you can do before purchasing any contract management software.