How to Use Tech to Automate Your Contract Management Process

Why Automating Your Contract Management Makes Sense

Managing contracts can be time-consuming. It involves multiple steps: drafting, reviewing, negotiating, approving, and storing. Each stage often requires collaboration across teams, tracking important dates, and ensuring compliance. As businesses grow, keeping up with the manual process becomes harder. That’s where tech comes in. Automating contract management can save you time, reduce human error, and streamline the entire process. Let's dive into how tech can help automate this process.

Step 1: Get the Right Contract Management Software

The first thing you need is software designed for contract management. Many platforms offer a variety of features that can simplify everything from contract creation to tracking and signing. Look for software that:

• Allows for contract creation with templates.
• Automates the approval workflow.
• Tracks key dates like renewals or expirations.
• Stores contracts securely and allows easy retrieval.

Software like DocuSign, PandaDoc, and ContractWorks are widely used. Each platform has its strengths, so choose one that suits your specific needs.

Step 2: Automate Contract Creation

One of the most repetitive tasks in contract management is drafting contracts. You’re often starting from scratch, even if the new agreement is similar to previous ones. Automation can help here too.

Most contract management software allows you to create templates that can be used repeatedly. You can set up standardized language for common contract types—like non-disclosure agreements, service contracts, or vendor agreements. Once you have the template set up, all you need to do is plug in the specifics (like names, dates, and amounts).

Automation here can save hours of work. Plus, it ensures that your contracts are consistent, reducing the chances of missing important terms or clauses.

Step 3: Simplify Approvals with Automated Workflows

Contract approval often involves multiple people: legal, finance, operations, and even senior management. Managing this process manually can be slow and error-prone. But automation can speed things up.

With contract management software, you can set up automated workflows that route contracts to the right people for review and approval. When a contract is ready, the system will automatically notify the relevant parties, who can review, suggest edits, and approve the document without needing to track down paper copies or send endless emails.

You can also set approval thresholds. For example, if a contract is under a certain value, it can be automatically approved by a single person. If it’s over a certain amount, it goes through multiple layers of review. This keeps things moving smoothly and helps you avoid bottlenecks.

Step 4: Use AI for Contract Review

Reviewing contracts is often the most time-consuming part of the process. With more advanced contract management systems, AI tools are now available that can help speed up this task.

AI can help identify potential risks in contracts, highlight missing clauses, and even flag areas where there might be inconsistencies. This reduces the amount of time spent reading through contracts line by line, allowing you to focus on the more strategic aspects of the agreement.

Some AI-powered platforms can even suggest changes or improvements to language, making it easier for legal teams to ensure compliance. For example, AI can recommend changes to standardize terms or flag language that doesn’t meet company policy.

Step 5: E-Signatures for Quick and Secure Signing

Gone are the days of printing, signing, and scanning contracts. E-signatures have become a standard practice in contract management, and they’re a game-changer.

With e-signature tools like DocuSign or HelloSign, you can send contracts for signature instantly. The signer receives an email with a link to the document, where they can review it and add their signature. The system automatically tracks who signed, when they signed, and even stores a copy of the signed contract. No more chasing down signatures or wondering where the contract is in the process.

The process is fast, secure, and legally binding. Plus, you can sign from anywhere—on your phone, tablet, or computer.

Step 6: Track Key Dates and Deadlines Automatically

Missing deadlines can be costly, especially when it comes to contract renewals, payments, or compliance obligations. Automated reminders help keep track of important dates and ensure you never miss a deadline.

Contract management systems can notify you when a contract is about to expire, when a renewal is due, or when specific obligations are approaching. This way, you can act before any important dates slip by.

You can set up notifications for a range of deadlines, such as payment schedules, contract milestones, or even annual compliance checks. This keeps everything organized and ensures you don’t get caught off guard.

Step 7: Centralize Contract Storage

Finding contracts across various email inboxes, file folders, or shared drives is inefficient. A centralized storage system is key to keeping everything in one place.

Contract management systems offer cloud-based storage, which makes it easy to organize, store, and retrieve contracts at any time. These systems allow you to tag contracts for easy searching, so you can quickly locate specific documents. Additionally, all contracts are stored securely, reducing the risk of losing important agreements.

Having a centralized location for contracts also makes it easier to track the status of contracts, whether they’re in progress, signed, or archived. You can also ensure all contracts are properly version-controlled, so you always work with the latest version.

Step 8: Monitor Contract Performance

Once a contract is signed, the work doesn’t stop. You still need to monitor how the agreement is being executed. Many contract management tools can help with this as well.

You can track milestones, monitor compliance, and make sure that the terms are being met. For example, you can use the system to track payment schedules, delivery dates, and performance metrics. If there’s a problem, you’ll be alerted early, allowing you to address the issue before it becomes a bigger problem.

Automated contract management systems also provide insight into contract performance over time. You can analyze data to identify trends, assess whether contracts are meeting expectations, and even find areas for improvement in future agreements.

Step 9: Keep Everything Secure

Security is always a concern when dealing with sensitive business data, including contracts. Fortunately, most contract management platforms offer strong security features to ensure your documents stay safe.

Encryption, secure user access, and audit trails are standard features in most systems. These features ensure that only authorized people can access contracts, and you can easily track who made changes or viewed a document.

Cloud-based platforms are often more secure than storing contracts on physical servers because they use advanced security protocols and offer regular updates to protect against emerging threats. Plus, you won’t have to worry about losing physical documents or dealing with the risks of local storage.

Step 10: Use Data for Continuous Improvement

The data you collect throughout the contract management process is valuable. Over time, you can analyze trends in your contracts and workflows to identify areas for improvement.

For example, you can look at how long it takes to approve contracts, which stages cause delays, or how often contracts are renegotiated. This data can help you fine-tune your processes, negotiate better deals, and improve efficiency.

Automation tools that track this data make it easier to identify patterns and make informed decisions. By continuously improving your contract management processes, you can enhance your organization’s overall efficiency and reduce the risk of errors or missed opportunities.

Final Thoughts

Automating your contract management process with the right tech tools can save time, reduce errors, and increase efficiency. From contract creation to secure signing and ongoing management, there are plenty of ways to streamline your processes. The key is choosing the right tools and leveraging their features to fit your company’s needs.

By implementing contract management software and automation, you’ll be able to focus on higher-value tasks, like building relationships with clients or improving your overall business strategy. And, you can rest easy knowing your contracts are secure, up-to-date, and properly managed.