Contract lifecycle management on customer contracts is a CFO and Director level responsibility, not a CRM task. Because failure to properly manage your contracts has far reaching and serious consequences for the organisation and individuals involved. Poor contract management impacts directly on revenues and profit margins, and the likelihood of litigation occurring, as well as claims for death and personal injury carrying the risk of jail time for contract managers.
Contract lifecycle management software on the sell side helps us get a better handle on what our organisation has committed to in customer agreements by providing visibility and access to agreements and pre-emptive alerts as trigger points approach. This mitigates our risk of non-compliance.
You are probably not the person who negotiates the agreements, but you might manage delivery to the customer. If this is the case, then you need to know of any special conditions present in the customer's contract. For example, you probably have the right to increase the value of your contract by CPI annually. You will need to provide notice of your intent to increase your rates within a certain number of days prior to the date when the contract rolls over, and if you miss the date, then you miss out on the price increase. There are other triggers that you will need to be aware of and you need systems to track these dates.
You must comply with your obligations to your customers. It is fundamental. You promise then you have to deliver (a contract is a promise). If you don't have a system that monitors deliverables and milestones, then governing your commitments will prove troublesome and items will slip through the cracks. You won't know that you are non-compliant until it is too late. And this non-delivery may mean annoying a customer or worse still, losing one.
Delays in some large contracts can make you liable to pay liquidated damages to your customer as a penalty for late delivery. Late or non-delivery can also lead to termination of an agreement, and possible litigation, costing your organisation millions in lost revenue and damages.
Contract lifecycle management software helps mitigate the risk of non-compliance in your customer agreements by automating your contract management processes for everyday tasks. Contract lifecycle management can make these processes available to your whole organisation providing corporate consistency, accountability, and auditability.
The biggest risk is not knowing what your commitments are. How can you manage your risk if you do not even know what contracts you have? How long does it take you to locate a contract, its amendments, history, and associated correspondence and file notes? Sounds like it?s time to put in a system. - 15790
Contract lifecycle management software on the sell side helps us get a better handle on what our organisation has committed to in customer agreements by providing visibility and access to agreements and pre-emptive alerts as trigger points approach. This mitigates our risk of non-compliance.
You are probably not the person who negotiates the agreements, but you might manage delivery to the customer. If this is the case, then you need to know of any special conditions present in the customer's contract. For example, you probably have the right to increase the value of your contract by CPI annually. You will need to provide notice of your intent to increase your rates within a certain number of days prior to the date when the contract rolls over, and if you miss the date, then you miss out on the price increase. There are other triggers that you will need to be aware of and you need systems to track these dates.
You must comply with your obligations to your customers. It is fundamental. You promise then you have to deliver (a contract is a promise). If you don't have a system that monitors deliverables and milestones, then governing your commitments will prove troublesome and items will slip through the cracks. You won't know that you are non-compliant until it is too late. And this non-delivery may mean annoying a customer or worse still, losing one.
Delays in some large contracts can make you liable to pay liquidated damages to your customer as a penalty for late delivery. Late or non-delivery can also lead to termination of an agreement, and possible litigation, costing your organisation millions in lost revenue and damages.
Contract lifecycle management software helps mitigate the risk of non-compliance in your customer agreements by automating your contract management processes for everyday tasks. Contract lifecycle management can make these processes available to your whole organisation providing corporate consistency, accountability, and auditability.
The biggest risk is not knowing what your commitments are. How can you manage your risk if you do not even know what contracts you have? How long does it take you to locate a contract, its amendments, history, and associated correspondence and file notes? Sounds like it?s time to put in a system. - 15790
About the Author:
Adam McInnes is the CEO of Open Windows Contracts, an innovator in contract lifecycle management software. Open Windows offers a trial of their contract management software and further information that you may be interested in.