Contract Lifecycle Management services (CLMS) is a technology enhanced contract realisation process.
It simply means effectively administering contracts and relationships between entities by strategically going through every stage of contract management resulting in reducing, eliminating or mitigating financial, legal and procurement risks. Contract lifecycle covers any process that brings the parties a step ahead in discharging their obligations right from the initiation involving drafting through to execution and closure.
When it comes to contract lifecycle management services, the first thing that comes to the mind is that it is a wholly technology driven process. That is true to an extent but contract is a legal document which would definitely require human intervention and that too of a legal expert as it involves various traditional stages which could only be evaluated by a human mind.
Our service offerings can help our clients to reduce the routine, repetitive and voluminous work of their legal departments and let them focus on adding strategic value to their companies as such routine, repetitive and voluminous work constitutes around 45% of their legal work. Close to a one third of organization’s legal spend is on contract management.
The First and foremost stage of Contract Lifecycle Management is Contract request where one party initiates the contracting process and subsequently uses that information for drafting the contract document.
Authoring the terms of contract is an important stage where parties pay attention regarding the specific usage of wordings as ambiguity leaves contracts up for interpretation. Country norms will also need to be taken into consideration, especially if two parties are in different locations.
This is the contract drafting stage where legal needs are analyzed to weigh what terms and conditions are required in final contract. In this stage contract document is generated with all clauses, terms and conditions wherein approver and signing parties negotiate the contract and signing details are captured in the contract document.
This stage of contract lifecycle management includes 2 services:
Approval is next to the negotiation in which the document prepared is further submitted for availing sanctions of different departments so that contract document can proceed to the next step in the Contract Lifecycle.
For closure of any deal, the parties must sign the final agreement. The signing is the simplest part of a contract, which signify official authentication of a contract document. This may be achieved either by digital signature on an electronic document or by wet signature on a paper document.
In long-term Business relationships, revisions and amendments are common in practice. We need a reliable process to keep track of original terms in addition to the added amendments. It is important to have everything available in one repository to provide a consolidated view so that parties can stay ahead of the changes and make sure that they are fully aware of the agreement or any revisions.
Once the final contract document is prepared it is stored permanently and with contractual meta data fields, which is saved for future references. This stage enables business users to quickly search, apply filters and retrieve relevant documents from the contract system
This is the most important stage of CLM after the contract has been executed. In this stage, the contracts, which are uploaded into common repository, are further streamlined through contract management. This involves contract summarization, tracking contract obligations, creating files, alerts, renewals and generating assessment reports.
In addition to this, it also notifies the clients about the present status, contractual obligations and the risk analysis relating to its each and every contract.