7 reasons why CLM implementations fail (and how to avoid them) 

Implementing a Contract Lifecycle Management (CLM) platform can be a game-changer for any organization, streamlining processes, improving compliance, and boosting revenue.  Yet, despite the best intentions, many CLM implementations fall short of expectations. Read on for the top seven most common reasons CLM implementations fail – and how you can avoid these common pitfalls to ensure success. 

The challenge at hand 

The technical aspect: Implementing CLM systems can be a complex endeavor, often requiring a significant investment of time, resources, and expertise.  

According to a 2022 Onit survey, more than three quarters of in-house counsels (77%) experience failed technology implementations and indicate the most common factors contributing to the failure are lengthy processes (38%), overcomplicated solutions (36%) and technology unfit for their actual needs (33%).  

The complexity arises from the need to integrate CLM solutions with existing systems, customize workflows to meet specific business needs, and ensure compliance with various regulatory requirements. Each organization has unique contract management processes, which means that a one-size-fits-all approach rarely works. Instead, successful CLM implementations often involve a tailored approach that addresses the specific challenges and goals of the organization. 

The investment aspect: The costs associated with CLM implementations can vary widely depending on the size and complexity of the organization, as well as the specific features and capabilities required. While the upfront investment can be substantial, many organizations find that the long-term benefits—such as improved efficiency, reduced risk, retained revenue, and better compliance—justify the expense. Ultimately, a well-implemented CLM system can provide a strong return on investment by streamlining contract processes and enhancing overall business operations. 

The 7 most common reasons why CLM implementations fail 

1. Lack of clear objectives

One of the primary reasons CLM implementations fail is the absence of clear, well-defined objectives. Without a clear understanding of what you want to achieve, it’s easy to get lost in the myriad of features and functionalities that CLM tools offer. 

How to avoid it: Start with a clear roadmap. Define your goals and objectives upfront. Are you looking to improve compliance, reduce contract cycle times, or enhance visibility into contract data? Having specific, measurable goals will guide your implementation process and keep you focused on what matters most. 

2. Inadequate stakeholder engagement

Another common pitfall is failing to engage key stakeholders throughout the implementation process. If the people who will be using the system daily aren’t involved in the selection and implementation phases, they’re less likely to adopt the new tool. 

How to avoid it: Involve stakeholders from the beginning. Gather input from various departments—legal, procurement, sales, and IT—to ensure the CLM tool meets the needs of all users. Regularly communicate progress and solicit feedback to keep everyone engaged and invested in the project’s success. 

3. Underestimating data migration challenges

Migrating existing contracts and data into a new CLM system can be a daunting task. Many implementations fail because organizations underestimate the complexity and time required for data migration. 

How to avoid it: Plan for data migration early in the process. Conduct a thorough audit of your existing contracts and data. Develop a detailed migration plan that includes data cleansing, mapping, and validation steps. Allocate sufficient time and resources to ensure a smooth transition. 

4. Insufficient training and support

Even the best CLM tool won’t deliver results if users don’t know how to use it effectively. Lack of training and ongoing support can lead to low adoption rates and frustration among users. 

How to avoid it: Invest in comprehensive training programs, like Agiloft University. Provide initial training sessions during the implementation phase and offer ongoing training opportunities to keep users up to date with new features and best practices. Ensure there’s a robust support system in place to address any issues that arise. 

5. Ignoring integration needs

A CLM platform that doesn’t integrate well with your existing systems can create more problems than it solves. Poor integration can lead to data silos, duplicate entries, and inefficiencies. 

How to avoid it: Choose a CLM platform that offers seamless integration with your existing systems, such as ERP, CRM, and document management systems. Work closely with your IT department to ensure the integration process is smooth and that data flows seamlessly between systems. 

6. Overlooking change management

Implementing a new CLM tool often requires significant changes to existing processes and workflows. Without a solid change management strategy, these changes can meet resistance and hinder the success of the implementation. 

How to avoid it: Develop a comprehensive change management plan. Communicate the benefits of the new CLM tool to all users and address any concerns they may have. Provide training and support to help users adapt to new processes and workflows. Celebrate small wins to build momentum and keep the project on track. 

7. Choosing the wrong vendor altogether

In a recent Agiloft poll, 39% of respondents said that they will not, or are not sure about, implementing a CLM solution simply because there were too many vendor choices. With so many options out there, each boasting unique features and benefits, it’s easy to get overwhelmed. After all, it’s not just about finding a vendor with the best technology; it’s about finding a partner who understands your business and can support your long-term goals.  

How to avoid it:   

To help narrow down your choices on the marketplace, be sure to ask the following questions: 

• What are you trying to accomplish with a CLM solution?   

• What is your implementation success rate? (e.g. Agiloft carries a 99.6% implementation success rate.) 

• Can you find a vendor dedicated to meeting your needs rather than simply selling a software package?    

• Can you validate each vendor’s customer satisfaction and analyst profile within the industry?    

• What is each vendor’s commitment to innovation and to running a stable business? 

• Can each vendor’s product respond to unforeseen circumstances or scale with your needs as your organization grows? 

Conclusion

While implementing a CLM tool can be challenging, avoiding these common pitfalls will significantly increase your chances of success. By setting clear objectives, engaging stakeholders, planning for data migration, investing in training and support, ensuring seamless integration, and managing change effectively, you can pave the way for a successful CLM implementation. 

Remember, the goal is not just to implement a tool, but to create a system that enhances your contract management processes and delivers long-term value to your organization. Here’s to your long-term CLM success!  

Discover how you can streamline your contract management across the enterprise. Start a conversation with us today.