How to Improve Contract Management: A Comprehensive Guide

Managing contracts efficiently is a cornerstone of successful business operations. Yet, recent studies from World Commerce & Contracting have shown that companies lose up to 8.6% of annual revenue due to weak contract management practices. The good news? With strategic improvements, businesses can save time, reduce costs, and seize missed opportunities.

In this guide, we explore how to improve contract management through five actionable tips that streamline processes and boost productivity.

1. Create and automate contract templates

Drafting contracts manually takes significant time, especially for recurring agreements such as employment or purchase contracts. One of the most effective ways of how to improve contract management is to standardize and automate templates. You can:

• Use templates for contracts where only specific variables (e.g., price, parties, or notice period) change.
• Protect non-variable sections from accidental edits to maintain consistency.
• Digitize and automate templates with contract management software to generate quality-assured contracts by simply answering a few questions.

Benefits:

• Saves time by eliminating repetitive drafting.
• Improves team understanding of obligations.
• Accelerates contract negotiation processes.

2. Streamline approval workflows

Bottlenecks during approvals often slow down contract processing. Optimizing workflows is crucial when learning how to improve contract management. When using contract management software, you can easily streamline approvals by:

• Automatically notifying authorized personnel when a contract is ready for approval.
• Setting up rules to pick up an approver based on specific conditions in the contract.
• Locking contracts to prevent any changes while awaiting approval.

Pro Tip: Integrating automation ensures approvals happen promptly, reducing the time spent on administrative tasks.

3. Adopt electronic signatures

When it comes to solving how to improve contract management, using electronic signatures is one of the simplest ways to speed up execution and reduce time spent on managing physical documents.

Why use e-signatures?

• Eliminates delays caused by ordering bulk quantities of paper and printing documents.
• Allows counterparties to sign documents instantly from wherever they are in the world.
• Ensures legal compliance in 99.99% of cases (e.g., eIDAS and ESIGN).

Quick Fact:

E-signatures are legally binding in most jurisdictions, making them a reliable solution for businesses.

4. Centralize contract storage

Scattered contracts can lead to missed deadlines and lost agreements. Centralizing storage is a critical step in improving contract management.

Steps to centralize storage:

• Use a single digital repository for all contracts.
• Opt for solutions that make contracts searchable by keyword.
• Keep sensitive agreements secure with robust access controls.

Advantages:

• Quickly retrieve contracts when needed.
• Reduce risks associated with misplaced documents.

5. Set automated reminders and alerts in your calendar

Missed deadlines can result in financial losses and damaged relationships. Setting automated reminders is essential when learning how to improve contract management.

How to create efficient reminders:

• Use a contract management software solution that can integrate with your calendar (e.g., Google Calendar or Microsoft Outlook Calendar).
• Add alerts for key milestones like renewal or expiry dates.
• Automate who receives reminders for certain types of contracts.
• Ensure at least two team members receive alerts for important dates to avoid lapses during turnover.

Result:

Automated alerts ensure your team stays proactive, never missing important deadlines.

FAQs about how to improve contract management

What is contract management software, and how does it help?

Contract management software streamlines contract creation, storage, and tracking, making it easier to manage obligations and deadlines efficiently.

How can our business improve contract management?

By using tools such as automated templates and e-signatures, businesses can increase productivity and decrease contract-related costs.

Can contract management be entirely automated?

While many tasks can be automated (e.g., templates, reminders), human oversight remains essential for complex negotiations and final approvals.