In the world of business, sales contracts play a crucial role in sealing deals and ensuring the success and profitability of any organization. However, managing sales contracts effectively c an be a complex and challenging task. In this comprehensive guide, we will explore strategies and best practices for effective sales contract management. From establishing clear communication channels to leveraging automation technology, these strategies will help streamline your contract management processes and optimize your sales operations.
One of the most dreaded challenges that most sales teams face is closing sales deals by getting the contracts signed on time. Navigating through the complex sales contract management process is tedious for sales professionals considering the time spent on its creation, issue, and signing.
Whether it is a SaaS agreement, a service contract, or any other type of sales agreement, sales contracts can consume a significant amount of time. This often causes delays in closing the deals. In fact, 25% of businesses around the world have lost revenue due to poor contract management practices.
Having a sales contract management process thus becomes the need of the hour. A sales contract management process simplifies the daunting task of managing contracts by helping you address common issues, such as lack of contract visibility, security, compliance, prolonged cycles, and more. It’s a technology-enabled process that allows sales teams to create, store, manage, and track the progress of formal business contracts.
Further, the sales contract management process helps in tracking contracts across various stages of contract lifecycle management and maximizing sales team productivity and overall efficiency.
In this article, we’ll learn how to set up an efficient sales contract management process for your organization.
1. The Importance of Sales Contract Management
Effective sales contract management is vital for the success and sustainability of any business. It involves the processes and activities associated with the creation, execution, monitoring, and managing of contracts between a company and its customers or clients. A well-managed sales contract ensures that all parties involved are aware of their rights, obligations, and responsibilities, reducing the likelihood of disputes and misunderstandings.
2. Establishing Clear Communication Channels
Open and clear communication between the sales and legal teams is crucial for successful sales contract management. Both teams share a common goal of closing deals and generating revenue, but they often have different perspectives and priorities. By fostering regular communication and establishing open dialogue, you can bridge the gap between these teams and ensure that they work together seamlessly.
Regular meetings and collaborative contract review sessions provide opportunities to discuss priorities, address concerns, and resolve any roadblocks that may hinder the sales team from reaching their goals. By understanding the needs, processes, and work styles of the sales team, the legal team can provide valuable insights and assistance in navigating the contracting process more efficiently.
3. Leveraging Pre-Approved Templates
Sales teams often spend a significant amount of time on administrative work, taking away valuable selling time. One effective strategy to optimize sales contract management is to develop pre-approved contract templates. These templates, created in collaboration with the legal team, provide a standardized framework for sales contracts, reducing the time and effort required to draft new agreements.
By using pre-approved templates, sales teams can initiate contract drafting more easily and quickly. Additionally, the templates ensure compliance with internal company standards and regulatory requirements, mitigating the risk of non-compliance. Integrating these templates into a contract drafting tool or a customer relationship management (CRM) system further accelerates the contract creation process by automatically populating client data into the agreement.
4. Streamlining Approval Workflows
Approval workflows are critical for ensuring that key stakeholders have an opportunity to review and approve contracts before they are sent to customers for signature. However, jumbled and inefficient approval processes can lead to delays, errors, and frustrations among teams. To streamline approval workflows, consider implementing automation technologies that facilitate the smooth flow of contract reviews.
Automated approval workflows ensure that contracts reach the right people for input and review at the right time. By eliminating manual handoffs and automating reminders and notifications, you can significantly reduce bottlenecks and accelerate the approval process. These streamlined workflows enhance collaboration, improve visibility, and minimize the risk of contracts being delayed or overlooked.
5. Utilizing Milestone Alerts and Notifications
In addition to assisting with contract drafting and approval, the legal team can play a crucial role in customer retention. By setting up automated milestone alerts and notifications, sales teams can stay informed about contract renewal, renegotiation, termination, and other important events.
Automated alerts ensure that sales teams are aware of upcoming contract milestones and can take necessary actions in a timely manner. Whether it’s renewing a contract or addressing changes within a document, these notifications help sales teams stay proactive and maintain strong relationships with customers. By automating routine tasks, sales teams can focus on providing exceptional customer service and addressing customer needs without constantly monitoring for updates.
6. Measuring Contract Performance
To drive continuous improvement in sales contract management, it is essential to measure and analyze contract performance. By tracking key metrics and analyzing contract data, you can gain valuable insights into the effectiveness of your contracts and identify areas for improvement.
Metrics such as contract quantity, contract quality, contract maintenance costs, and average closing time provide valuable information about the performance and efficiency of your contracts. Regularly reviewing these metrics allows you to monitor progress towards your goals and identify opportunities for optimization. By measuring contract performance, you can make data-driven decisions, improve collaboration between sales and legal teams, and enhance the overall effectiveness of your sales contract management processes.
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5 Steps for Managing Sales Contracts
1. Audit Your Existing Sales Contract Management Process
The first step to creating an effective sales contract management process is to start auditing your existing processes to identify the bottlenecks, pain points, and challenges. This will ensure that the new approach you build will be foolproof, efficient, and promise excellent results.
Before we understand how to audit your current processes, ask yourself the following questions.
- Has your sales team ever found difficulty in sharing contracts with your clients?
- Has your sales team ever missed connecting with the clients for plan renewals?
- Did your sales team ever send a different version of a contract?
- Does your sales team encounter hurdles when searching for contracts or any other documents?
These are the sure signs that you need to audit your contract management processes. Follow the below-mentioned steps to get started.
- Identify the key stakeholders who are involved in your existing sales contract management process and learn more about their roles.
- Review the processes of contract creation, its review and approval, negotiation, and how it is sent and its status tracked. This will help you identify the areas that might be inefficient.
- Ask for feedback from your sales team members regarding the existing processes and capture suggestions for making potential improvements.
2. Invest in a Contract Management Tool
Leverage a contract management tool to manage your entire sales contract process online. Eliminate the hassles of spending hours drafting a contract, getting it approved by the key stakeholders, and sending it for signing to the customers.
Contract management software beats manual processes in so many ways. Let us quickly explore how it can improve your work processes.
- Create contracts and share them with your clients in just a few clicks. Track the progress of contract signing across all stages of its lifecycle.
- Store all necessary contract-related data online and ensure it can be easily accessed by team members and key stakeholders at all times.
- Reduce the contract approval time by automating the review process and improving its efficiency.
- Send real-time notifications to the stakeholders about contract reviews, expiration dates, contract negotiations, and more.
- Reduce the friction between the different teams by introducing seamless workflows and closing deals faster.
Improve your company’s operational efficiency using a system that helps you complete more work in less time.
3. Develop Pre-approved Templates
Create ready-to-use sales contract templates in advance that sales representatives can use to draft contracts and compliance agreements in no time. It will save them from the hassles of the complex contract creation processes and generate error-free contracts for the clients. Using contract templates will help in faster contract creation leading to better client experiences and more satisfied clients.
Setting up pre-approved templates will help sales representatives to send precise contracts to the clients with minimal involvement on the legal team. It will reduce unnecessary delays and follow-ups for both teams and boost process productivity.
Here are a few tips you can follow to ensure effective contract templatization.
- Identify the types of contracts that are often sent to most of your clients. These contracts would be the ideal ones to be standardized into templates.
- Start from scratch by looking up publicly available templates and collaborating with the relevant stakeholders. This will ensure you follow a sensible structure and include all the crucial details.
- Utilize simple and understandable language when drafting these templates. Replace complex wordings with easy words to ensure your clients understand the terms without any misunderstandings.
- Do a pilot test on these templates by letting the sales representatives use them. Gather their feedback and continue to refine your templates whenever required.
4. Configure Streamlined Approval Workflows
Every contract is usually reviewed and approved by the key stakeholders before they are sent to the clients for signatures. However, owing to the busy schedules of the various teams involved in this process, there is significant friction that can cause potential delays in sharing the contracts. Hence, introducing approval workflows and automating the said process is the need of the hour.
An approval workflow ensures that the entire process of reviewing and approving contracts is streamlined and accelerated. It eliminates the bottlenecks, reduces time wasted on manual follow-ups, and increases team collaboration.
Before setting up an approval workflow for your contracts, identify the pain points of your existing contract approval process. Next, recognize the key stakeholders and assign them various responsibilities in the approval process. Leverage your contract lifecycle management system (CLM) to create this workflow online and automate the same using conditional logic, allocating role-based permissions, and setting up real-time notifications.
5. Integrate Your CLM with CRM
Instead of letting your sales team use a contract management system for managing contracts and a customer relationship management system for managing the client separately, connect these platforms with the help of system integration and boost your sales team’s productivity.
The CLM-CRM integration will help your sales team in the following ways.
- Accurate contract creation – Integrating CRM with CLM ensures that your sales team has accurate data about the client as well as the right contract. They can create error-free contracts in no time and spend the saved time on closing the deals.
- Accelerated contract drafting – With CLM-CRM integration, sales representatives will be able to generate contracts without much effort. By inserting the client data from the CRM directly into CLM, they can speed up the entire contract creation process. This reduces the amount of time spent on manual tasks, such as data entry, file uploads, and more.
- Increased contract visibility – Every member of your sales team can access client information and important contract details at any point in time. It also helps in tracking the various revisions a contract may go through over its lifetime so that no crucial aspect of a contract gets overlooked.
6. Measure Contract Performance
Monitor and analyze the performance of your sales contract management processes from time to time. This will help you understand what is working for your company and what is not. It will help you identify the bottlenecks in your revamped processes and take measures to resolve them. Measuring contract performance will also help you gain insights into designing better contracts in the future.
Here are some of the crucial metrics that you must track are:
- KPIs for tracking contract efficiency, such as contract processing time.
- KPIs for monitoring contract effectiveness, such as the number of contracts created, contract renewal rates, and more.
- Annualized contract value (ACV) for measuring the value of all recurring contracts.
- KPIs for measuring contract risks, such as the number of expiring agreements, risk-prone signing, vendor fraud, and more.
- Time to Signature to measure the overall time taken from contract initiation to contract signing.
Monitoring these KPIs is crucial as it forms a strong basis for improving your contract management performance. It provides you with valuable information for optimizing your entire sales contract management processes.
Best Contract Management Software of 2024: Streamlining Contract Workflows
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Contract management is a critical aspect of business operations that often involves manual and time-consuming tasks. However, with the advancements in technology, businesses can now leverage contract management software to automate and streamline their contract workflows. In this article, we will explore the best contract management software of 2024 that can help businesses accelerate their contracting processes, automate approvals, and efficiently manage contracts.
1. ClickUp: Simplify Contract Management with ClickUp Docs
ClickUp is a comprehensive contract management software that offers a range of features to streamline and track the entire contract lifecycle. With ClickUp Docs, businesses can easily manage important documents and foster team collaboration. The software provides various contract management templates, document management capabilities, and contract storage to store, track, and manage contracts effectively.
One of the key features of ClickUp is its user-friendly interface, making it easy for contract managers and teams to navigate the platform. The software allows users to create tasks with custom statuses to track the progress of each contract. Additionally, ClickUp enables users to categorize all business contract-related details, such as signing date, department, and type of contract, to effectively manage contracts and visualize contract data.
ClickUp also offers powerful project management features, such as time-tracking, dependency warnings, and email integration, to improve contract management and tracking. With ClickUp Automations, businesses can streamline recurring tasks and free up more time for knowledge-intensive work. The software also provides contract analytics and detailed reporting, allowing teams to manage master service agreements, track contract performance, and monitor deadlines.
Pricing: ClickUp offers a Free Forever plan with limited features. Paid plans include Unlimited at $7/user per month, Business at $12/user per month, and Enterprise with custom pricing.
2. Congavia Conga: Harness the Power of AI with Conga
Conga is a contract management software that leverages AI-powered capabilities to simplify the contract lifecycle management process. With Conga Contract Intelligence, businesses can extract commercial terms from contracts and transform them into verified data for business users. This AI-powered feature enables businesses to quickly identify key terms and clauses in contracts, such as renewal dates, termination clauses, and pricing, facilitating informed decision-making.
The software also provides a secure contract repository to store and search for critical documents. With Salesforce integration, Conga enables users to create and deliver alert notifications to the right stakeholders directly from the contract management system. The contextual topic search and customizable dashboards make it easy to find information and track contract data.
While Conga offers a range of contract management features, some users have reported challenges with navigation and customization. However, the software’s integration with leading electronic signature platforms, such as Docusign, ensures a seamless e-signature process.
Pricing: Conga offers custom pricing based on specific business requirements.
3. DealHub: Simplify Contracting with DealRoom
DealHub is a contract management software that simplifies the contract management process by bringing all stakeholders to collaborate on one digital dashboard, DealRoom. With DealHub, businesses can generate legal documents, revise contracts, manage redlines, and provide real-time status and visibility. The software offers contract management templates for various types of agreements, streamlining the contract creation process.
DealHub’s contract management platform allows users to generate NDAs, MSAs, and other contracts in various formats, such as HTML, Word, and PDFs. The software also provides CRM integration with leading platforms like Salesforce, Freshworks, and Hubspot, allowing users to access all agreements and documents directly within their CRM. Customizable approval workflows ensure internal alignment before sending contracts to customers.
While DealHub offers a range of features, some users have reported challenges with the template creation interface and the lack of integration with popular e-signature tools. However, the software’s all-in-one solution provides a centralized workspace for contract management and collaboration.
Pricing: DealHub offers custom pricing based on specific business requirements.
4. Concord: Streamline Contract Negotiations with Concord
Concord is an all-in-one contract management system designed to streamline contract document management for businesses. The software offers features such as contract authoring, negotiation, and storage for both internal and external parties. With Concord, businesses can automate contract negotiation processes, eliminating the need for manual redlining and tracking changes.
Concord’s secure contract repository ensures that teams always have access to the most updated version of a contract. The software also offers e-signature capabilities, allowing users to easily and securely sign contracts with a few clicks. The platform provides real-time collaboration features, such as comments and chat, enabling internal reviewers, business teams, customers, and contract management vendors to communicate effectively.
While Concord offers a range of contract management features, some users have reported limitations in terms of customization options and the additional cost of adding unlimited users to contracts. However, the software’s intuitive interface and comprehensive dashboard for reporting and analytics make it a valuable tool for contract management.
Pricing: Concord offers three pricing plans: Standard at $17/user per month, Professional at $49/month, and Enterprise with custom pricing.
5. Trackado: Manage Contract Lifecycles with Trackado
Trackado is a contract management software that provides businesses with a comprehensive tool to manage the entire contract lifecycle. The software offers a contract repository to store and manage contracts effectively. With Trackado, businesses can set events and reminders for upcoming contract renewals, assign responsibilities to team members, and automate the contract review and approval process.
The workflow automation module in Trackado allows businesses to route contracts through the necessary review and approval processes before sending them to customers. The software also provides advanced search functionality with OCR to easily find contract details and integrates with GPT-3 to leverage AI for contract creation and clause simplification.
While Trackado offers valuable contract management features, some users have reported limitations in terms of searching and filtering using company names and the lack of integration with popular business sources like Microsoft Dynamics. However, the software’s focus on contract lifecycle management and its pricing options make it a viable option for businesses.
Pricing: Trackado offers a free plan and paid plans starting from $39/month.
6. GetAccept: Enhance Contract Management with GetAccept
GetAccept is a contract management software that provides organizations with pre-built templates and interactive proposals for smooth contract management. With GetAccept, businesses can collaborate with stakeholders to create an easy buying experience, reducing the time to close deals. The software offers an overview dashboard to manage contracts of all pending deals and evaluate which deals require immediate attention.
GetAccept’s contract management platform allows users to upload sales collateral and create mobile-responsive sales content using the built-in editor. The software also offers pre-built contract templates to streamline the proposal creation process. With native eSignature integration, users can easily sign contracts electronically and track their progress.
While GetAccept offers a range of contract management features, some users have reported challenges with sorting and filtering data for contract management. However, the software’s focus on interactive proposals and seamless e-signature capabilities make it a valuable tool for sales teams.
Pricing: GetAccept offers multiple pricing plans, including Essential at $15/user per month, Deal Room Professional at $39/user per month, Contract Room Professional at $49/user per month, and Full Suite Professional at $79/user per month.
7. ContractWorks: Simplify Contract Administration with ContractWorks
ContractWorks is a contract management software designed to help businesses manage multiple client projects and contracts. The software offers automated contract lifecycle management, improving transparency and providing alerts about crucial contract details and events. With ContractWorks, businesses can draft agreements in minutes, track contract renewals, and search for contract details easily.
ContractWorks’ contract management solutions provide a shared environment for relevant stakeholders to facilitate contract negotiations collaboratively. The software also offers advanced search functionality with OCR and integration with GPT-3 for contract creation and clause simplification. ContractWorks is particularly suitable for businesses that require compliance with government regulations and periodic audits.
While ContractWorks offers valuable contract management features, some users have reported limitations in terms of customization and bulk operations, such as archiving all expired contracts. However, the software’s focus on contract obligation management and its pricing options make it a viable choice for businesses.
Pricing: ContractWorks offers three pricing plans: Standard at $700/month, Professional at $900/month, and Premium at $2000/month.
8. Agiloft: Customize Contract Workflows with Agiloft
Agiloft is a contract management software that offers a fully customizable no-code platform for managing the entire contract lifecycle. The software provides dynamic clause libraries and templates to fasten the contract creation process. With Agiloft, businesses can easily find contract documents and details using the natural language search feature.
Agiloft’s contract management software allows users to create custom contract templates with conditional logic, ensuring that the final contract is tailored to specific requirements. The software also offers an intuitive interface and robust search functionality, enabling users to find contract data quickly. Agiloft’s customizable platform allows businesses to streamline their contract workflows and focus on strategic tasks.
While Agiloft offers valuable contract management features, some users have reported challenges with the initial learning curve and the lack of technology to identify duplicate agreements. However, the software’s customizable no-code platform and its focus on contract lifecycle management make it a valuable tool for businesses.
Pricing: Agiloft offers three pricing plans: Essentials, Advanced, and Premium, with custom pricing based on specific business requirements.
9. Outlaw: Streamline Contract Negotiations with Outlaw
Outlaw is a modern contract management software that simplifies the contract lifecycle for organizations. The software offers features such as templated document generation, contract-based redlining, real-time negotiation, and eSigning. With Outlaw, businesses can streamline contract drafting and negotiations, allowing their legal teams to focus on strategic work.
Outlaw’s contract management software enables users to create custom contract templates with dynamic clause libraries and conditional guardrails. The software provides real-time audit trails, version control, and notifications to maintain transparency and visibility. Outlaw also offers seamless integration with other applications, enabling users to access all contract-related data and documents in one place.
While Outlaw offers valuable contract management features, some users have reported challenges with court-related documents and sorting and filtering data for contract management. However, the software’s focus on contract authoring and its all-in-one solution make it a valuable tool for businesses.
Pricing: Outlaw offers custom pricing based on specific business requirements.
10. ContractSafe: Centralize Contract Management with ContractSafe
ContractSafe is a contract management software that provides businesses with a secure and centralized platform to manage their contracts. The software offers a dedicated repository to store, search, and track contracts from one place. With ContractSafe, businesses can set contract deadline reminders, assign tasks to team members, and easily access critical contract information.
ContractSafe’s contract management software ensures data security and compliance, with features such as encryption, malware and virus detection, and vulnerability tests. The software also provides customizable dashboard analytics and custom reports, allowing businesses to gain insights into contract performance and compliance. ContractSafe’s mobile access feature enables users to access contract data on any device, at any time.
While ContractSafe offers valuable contract management features, some users have reported challenges with dragging and dropping contracts into different folders and the need for training and explanation for certain features. However, the software’s focus on secure and centralized contract management and its pricing options make it a viable choice for businesses.
Pricing: ContractSafe offers four pricing plans: Basic at $329/month, Standard at $549/month, Professional at $779/month, and Enterprise at $999/month.
Conclusion
Effective sales contract management is crucial for the success and profitability of any business. By implementing strategies such as clear communication channels, pre-approved templates, streamlined approval workflows, milestone alerts, and contract performance measurement, you can optimize your sales contract management processes. Embracing automation technologies and leveraging contract management software can further enhance efficiency and productivity, allowing your sales team to focus on what they do best – closing deals and driving revenue. With these strategies in place, you can ensure that your sales contracts are managed effectively, mitigating risks, and maximizing business opportunities.
Remember, effective sales contract management is an ongoing process that requires continuous improvement and adaptation to changing business needs. By incorporating these strategies into your contract management practices, you can streamline your operations, foster collaboration between teams, and achieve greater success in your sales endeavors.
Although sales contract management seems like a challenging and time-consuming process, it can be streamlined for better efficiency and performance. You can revamp your existing processes by identifying recurring bottlenecks, automating manual tasks, and introducing seamless workflows to yield outstanding results. We are certain that you will follow the tips we mentioned in this blog to optimize your sales contract management process and boost your sales.
As businesses continue to rely on contracts for their operations, contract management software becomes essential for streamlining workflows and improving efficiency. The best contract management software of 2024 offers a range of features, including AI-powered contract management, self-service portals, automated document assembly, contract obligation management, connected systems, workflow automation, secure repositories, electronic signature integration, dashboard analytics, and mobile access.
Each software has its own unique strengths and limitations, catering to the specific needs of different businesses. By leveraging these contract management software tools, businesses can optimize their contract processes, reduce manual work, improve collaboration, and ensure compliance. Whether it’s ClickUp, Conga, DealHub, Concord, Trackado, GetAccept, ContractWorks, Agiloft, Outlaw, or ContractSafe, finding the right contract management software can revolutionize the way businesses manage their contracts.
Q&A Section:
1. Why is effective sales contract management crucial for businesses? Effective sales contract management ensures clarity, reduces disputes, and outlines obligations for all involved parties. It streamlines processes, minimizes delays, and helps maintain strong customer relationships, ultimately contributing to business success and profitability.
2. How does poor contract management impact businesses? Poor contract management can lead to revenue loss, legal issues, and damaged relationships. It can cause delays in deals, compliance issues, misunderstandings, and inefficient resource allocation, affecting the overall success of the business.
3. What role does communication play in sales contract management? Clear and open communication between sales and legal teams is vital. It aligns priorities, resolves conflicts, and ensures that contracts meet legal standards while fulfilling business objectives. Regular dialogue helps bridge gaps and enhances collaboration.
4. How can pre-approved templates improve contract management? Pre-approved templates standardize the contract creation process, reducing the time spent on drafting agreements. They ensure compliance, minimize errors, and empower sales teams to generate contracts efficiently, maintaining consistency and accuracy.
5. What benefits do automated approval workflows offer in contract management? Automated approval workflows streamline the review process, ensuring contracts reach the right stakeholders promptly. They reduce bottlenecks, eliminate manual handoffs, and enhance collaboration, leading to faster approvals and reduced contract cycle times.
6. Why is contract performance measurement important? Measuring contract performance provides insights into efficiency, risks, and areas for improvement. Key metrics help track contract processing time, renewal rates, value, and risks, aiding in optimizing processes and adapting to evolving business needs.
7. Why is contract management software important for businesses? Contract management software streamlines processes, automates workflows, and centralizes contract data, reducing manual tasks and errors. It enhances collaboration, ensures compliance, and provides insights for informed decision-making, ultimately boosting efficiency and mitigating risks.
8. How does contract management software improve workflow efficiency? Contract management software automates tasks like document storage, contract creation, approvals, and alerts, reducing manual effort and time spent on administrative tasks. It centralizes information, enables collaboration, and offers insights to expedite contract lifecycles.
9. What are some key features to consider in contract management software? Essential features include document management, templates, e-signatures, search functionality, integrations, analytics, and customizable workflows. Advanced functionalities like AI-driven contract intelligence, automated notifications, and CRM integration enhance efficiency further.
10. What challenges might businesses face when adopting contract management software? Challenges include initial integration and learning curves, customization limitations, issues with navigation or user interface, and potential difficulties in data sorting or filtering. Some platforms might require additional training or explanation for certain features.
11. How do these software solutions help with compliance and risk management? Contract management software ensures adherence to regulatory standards by maintaining a centralized repository, tracking contract deadlines, and offering encryption and security measures. It aids in identifying risks by providing analytics and insights into contract performance.
12. Which factors should businesses consider when choosing contract management software? Businesses should assess their specific needs, scalability, ease of use, integration capabilities, security measures, pricing models, and support options. Customizability, mobile access, and the ability to align with existing workflows are also crucial factors to consider.
