While Contract Lifecycle Management (CLM) software is a big help to overburdened legal teams everywhere, you unlock its full potential when you bring in other departments.
CLM software helps legal track and manage contracts, maintain compliance, and store agreements in a centralized, easily accessible location. It also helps change the company’s perspective of legal from silo to collaborative business unit. The tool provides the entire business with visibility into contracts: their status, successes, and obligations.
This is important to note when making the business case for CLM. Even without being a daily user of the tool, other departments, team leaders, and executives all gain value from the tool. Let’s cover a few prime examples.
CEOs make crucial decisions daily. And just like America runs on Dunkin’, businesses run on data.
Without data, it’s impossible to measure performance and make informed decisions. While some businesses may be content playing guessing games about what’s working and what isn’t, setting up benchmarks and measuring your performance against it is the smart approach. Otherwise, your business strategy effectively amounts to crossing your fingers and wishing on a star.
Contract Lifecycle Management software provides businesses with key data points for benchmarking and metrics to measure effectiveness. Specifically, CLM data provides insight into the average contract value within a certain industry vertical, how many contracts you executed over a period of time, and approximately how long each takes to finalize. These metrics provide CEOs with the data they need to make hiring decisions, give input on sales territories, and appeal to investors during funding rounds.
Understandably, legal teams want to hold the reins of contract creation. Having final say over the agreements coming in and out of the business is a strong way to reduce your company’s risk profile. But that also reduces sales velocity. If legal had to draft and review every single contract, regardless of value or terms, there’s no way the company would hit its targets without legal facing serious burnout.
Fortunately, CLM makes contract creation easy for sales teams. Legal can generate pre-approved terms and contract templates, and set parameters around which contracts can be edited.
It’s a win-win, legal ensures that the contracts going out protect the interest of the business, and sales has the autonomy they need to run deals. Bonus: You don’t have to worry that there are contracts in the wild with unapproved language.
As regulations pass and businesses need to comply, website terms and conditions will need to be updated. Though the website is f the marketing team’s domain, the content of the terms and conditions is squarely in legal’s wheelhouse. And having the marketing team keep track of the versions of terms and where on the site they live invites unnecessary risk.
Thankfully, legal and marketing can easily collaborate using technology. Since legal has their finger on the pulse of legislations and regulations, they can determine a cadence for making substantive updates to the website terms. Then using this same cadence, marketing teams can update the site, having full confidence that they are uploading the correct version of the terms and conditions with CLM.
Contracts can be fickle and time-consuming. Since much of your legal team’s work includes reading, assessing risk, and writing, one difficult contract can majorly derail productivity.
If, for example, a sales rep cloned an old contract and sent it to legal for final approval, that contract might not have the most up-to-date language, and could even include some terms that are detrimental to the overall business.
As a result, in-house counsel will have to spend valuable time rewriting the agreement and including the necessary terms. Then they’d have to go through a tedious redlining process — one that may be even more tedious if they didn’t do their due diligence in drafting the contract in the first place — and that can take weeks, or months in a worst-case scenario.
But with the power of a CLM behind them, legal teams can automate the tedious parts of the contract process. In addition to automatically generating contracts, a powerful CLM like LinkSquares can have AI take a first pass at contracts, leaving the more complex and nuanced parts to human legal professionals. You can also create a workflow based on the contract type and the approval process that is specific to your business. A process that once took several weeks can now be completed in a few hours.
A CLM solution is the great collaborator inside businesses. Many teams run the risk of operating in silos, but with CLM software, each team has insight into what the other is doing. This is key to improving cross-functional alignment, giving your business a competitive edge.
Want to see it in action? Request a demo today.