Making better decisions by streamlining your contract data

Any decisions over contracts made in today’s uncertain economic landscape could make or break your organization.

Make the wrong decision, and you might find your organization unnecessarily spending on contract renewals. The right strategic decision, however, could actually drive savings and boost revenue.

So what’s hindering effective decision-making in companies today?  Many companies still rely on outdated legacy systems and manual processes that cannot meet the demands of the current business environment. This, combined with the fact that many large organizations operate in silos with each department having their own systems, made matters worse. As a result, contract managers do not have visibility into data that can help them make informed decisions.

No data, no analysis

This was exactly the problem that the Senior Technical Project Manager at a leading healthcare company faced before adopting Agiloft CLM.

Like many companies today, the customer relied on legacy systems and manual processes to manage contracts. This absence of a centralized system and standard processes created silos within the organization. The company had legal teams in different organizations and departments, and each department had systems of their own. Since contract taxonomies and terminologies weren’t standardized, there was confusion over the contract classifications.

This made assessing contract performance and analyzing spend management a struggle.

“When we are selling our services, we need to know what our performance is on that, and also know that when we’re providing the service and we’re getting paid, we’d have to know what payment variance. Are we getting paid what we contract?,” the project manager said.

In a webinar hosted by Agiloft, the project manager highlighted how a flexible CLM solution helped streamline the company’s convoluted contract management process and how that helped them make better strategic decisions.

Building the right foundations

To make the most of contract data, structures need to in place to ensure the data that’s being leveraged is accurate and comes from a single source of truth.

The company got the ground running in optimizing their contract management by developing a centralized contract repository – putting an end to their reliance on manual processes and Excel spreadsheets.

“The first step in any CLM process is get your portfolio, and get all the contracts in one space,” the project manager said.

Next, the company tackled the problem of confusing contract classifications. By agreeing on common taxonomies, employees could now go into the enterprise system and search a contract by its classification. A common approach to contracts helps eliminates silos within the company since everyone is now speaking the same language.

With a standardized approach and a centralized repository, employees can easily access and view all contract information from a single location. This helps them quickly find information about contract status, obligations, and risks without the need to search for documents across multiple departments or locations.

“Things like taxonomy and data dictionaries; those are all foundational elements in order to achieve a certain ROI or a value from the system,” he said.

Better visibility = Better decisions

With automated CLM, making strategic decisions have never been easier. The increased visibility that comes with Agiloft helps legal teams identify and manage risks associated with contracts more effectively. By having a complete view of all contracts, legal can spot potential risks and take proactive steps to mitigate them.

The transparency gained also provides contract leaders with oversight over compliance and regulatory requirements, helping organizations avoid costly penalties and legal issues that can arise from non-compliance.

Above all, Agiloft CLM enables better collaboration between teams involved in the contract lifecycle. By having a single source of truth for contract data, all parties can work from the same information, reducing the risk of errors and inconsistencies.

For the healthcare company, the benefits of a flexible, automated CLM could not come at a better time. Not unlike many other industries during the height of COVID-10, the organization struggled with rising labor costs and supply chain problems. To overcome these challenges, the team looked into their contract data—from renewals to price points—and leveraged Agiloft’s sophisticated analytic tools.

“I think having that capability to have visibility into your portfolio, it allows you to make better decisions,” the project manager said.

To learn more about how Agiloft CLM can help your healthcare company, check out this recent blog post about Ikena Oncology.