Digital transformation is continuing to gather pace in industries globally. However, according to our state of systems of agreement research, manual agreement processes still burden 9 out of 10 companies, resulting in poor customer experiences, delays in starting projects and delays in recognising revenue. So just how can businesses modernise their contract processes? The key answer – contract lifecycle management.
Modern agreements go far and beyond simply signing on a dotted digital line. Contracts need to be managed and acted on throughout their lifecycle to reap their full benefits. Therefore, businesses need to streamline and manage the entire agreement process. This approach can enhance both speed to market and compliance by creating more efficient and intelligent processes.
To drive their digital transformation forward, it is crucial that healthcare, banking, legal and manufacturing organisations fully understand and utilise the information held in their contracts. There are three direct benefits to be gained.
Enhanced efficiency with contract lifecycle management
A key challenge for many businesses is that agreements are often stored on multiple platforms, file shares, and drives. This can ‘bury’ valuable data, preventing a deeper dive into what’s in their contracts. Without those insights, an organisation can miss actionable information that could help reduce supply chain costs, improve cash flow and enhance compliance. According to the IACCM, ineffective contract management can cost businesses up to 9.2% of their revenue.
Meanwhile, the pandemic has accelerated digital transformation. To adapt to new consumer demands and buying methods, businesses have been forced to consider new partner and supplier contracts. Integrating all this activity into a business can be difficult. Having contracts in a single, searchable place, however, can increase a business’s oversight, speed and accuracy. This helps build and maintain a competitive advantage.
Intelligent, actionable insights
Businesses can also deploy AI-powered analytics to gather valuable information to help minimise disruption and improve cash flow. This allows them to extract hundreds of specific terms from agreements, accelerate contract cycle time and generate actionable insights.
Maersk, one of the world’s largest integrated shipping companies, uses DocuSign AI to help better understand its clients and 10,000+ contracts. By running analytics across its business portfolio, the company can fully scrutinise the contents of its agreements, yielding critical insights into its procurement operations. This could be regarding what their level of compliance is regarding a certain clause, payment terms or sustainability clause. This enables the team to quickly figure out what their contract language says about a certain thing. In the past, the only report we could run were the ones that they had metadata on, and that sets a number of limitations.
Proactive risk management
When contracts are obscured or locked in silos, it becomes impossible to properly assess the risks they might contain or determine a business’ exposure to external events. Manually analysing a portfolio of thousands of contracts for a single issue could take weeks. It might not even be feasible. This is where AI-enhanced contract lifecycle management (CLM) comes into its own. CLM makes the impractical possible and ensures a very high level of accuracy at speed.
In healthcare, for example, the pandemic has multiplied the volume of medical records and patient data stored online. This information plays a critical role in keeping hospital systems running and patients safe. However, outdated software can easily impede a healthcare centre’s ability to deliver quality healthcare efficiently. Here again, a next-generation CLM system can drive vital enhancements, helping ensure the best possible medical outcomes.
The quickening pace of business
Business activity around the globe is gathering pace. New ways of interacting are coming into play. In such a charged atmosphere, it is essential to remain competitive across the entire organisation. In this context, innovative CLM technologies won’t just improve business effectiveness. They can also help extract maximum value from existing contracts. And this value will be crucial for businesses to survive and thrive in a post-pandemic world.
DocuSign helps organisations connect and automate how they prepare, sign, act on, and manage agreements. As part of the DocuSign Agreement Cloud, DocuSign offers eSignature, the world’s #1 way to sign electronically on practically any device, from almost anywhere, at any time.