Selecting
a CLM solution
for your organization

The Contract Lifecycle Management (CLM) market is experiencing rapid expansion, projected to grow by 3.5 times between 2020 and 2030 and driven by the need for modern, streamlined contract management processes. While CLM platforms offer significant benefits in automation, compliance, and risk reduction, this growth has led to a crowded vendor landscape.  

Many businesses find this overwhelming, with a recent Agiloft poll showing 39% of respondents hesitating or opting against CLM implementation due to too many vendor choices. Despite this selection challenge, the demand for efficient contract management remains high for organizations aiming to improve operational efficiency, mitigate risks, and enhance compliance.  

For organizations looking to improve operational efficiency, mitigate risks, and enhance compliance, finding the right CLM solution has become a top priority. 

CLM Basics

Best practices for CLM

Intro to CLM

Vendor contracts bootcamp

Understanding your CLM needs

Identifying your business requirements 

The first crucial step in CLM selection is thoroughly assessing your organization’s specific needs by evaluating current contract processes. 

Ask key questions such as: 

• Are manual processes leading to delays or errors? 
• Are contract approvals taking longer than expected? 
• Are teams struggling with limited visibility into contract obligations or renewal deadlines? 

Identifying pain points, such as approval delays or compliance concerns, helps you prioritize features like workflow automation or automated compliance checks. Defining clear objectives—like improving efficiency, reducing errors, or enhancing visibility—will help ensure the chosen solution aligns with your goals. 

Stakeholder involvement in buying a CLM

Engaging key stakeholders from departments like Legal, Procurement, Sales, and Finance is critical for successful CLM implementation. Since contracts impact many areas, involving these teams early ensures the system addresses diverse needs, fosters user buy-in, and leads to better outcomes.  

A report by Gartner confirms that understanding different departmental pain points, such as Legal’s compliance needs or Sales’ desire for faster contract generation, is vital for defining system requirements and achieving long-term success. Early involvement of stakeholders also builds ownership and facilitates a smoother transition. 

Choosing the right CLM

After identifying your organization’s needs and engaging stakeholders, the next step is evaluating the features of potential CLM solutions. The right platform should address immediate pain points while offering advanced capabilities to support future growth. 

CLM selection criteria 

1. Contract creation and authoring tools:  
   A robust CLM platform should simplify the drafting process through customizable templates, pre-approved clause libraries, and collaborative editing capabilities. These tools save time, improve consistency, and minimize the risk of errors. 
2. Approval workflows and automation 
   Look for CLM software that automates approval workflows, routing contracts to the appropriate stakeholders, sending reminders, and escalating issues when necessary. Automation helps reduce bottlenecks and accelerates the contract lifecycle. 
3. Electronic and wet signatures 
   E-signature integration is essential for modern contract management, enabling secure and efficient signing. Some organizations may still require wet signatures for legal or regulatory purposes.  Agiloft’s data-first CLM platform supports both options, ensuring flexibility and compliance. 
4. Contract repository and storage 
   A centralized, searchable repository provides a single source of truth for all contracts. This ensures stakeholders have access to the latest contract data, reduces confusion, and minimizes risks associated with outdated or misplaced documents. 

Advanced features 

1. AI and machine learning capabilities 
   AI-powered tools can automate tasks like clause identification, risk assessment, and contract review. Machine learning can provide actionable insights, helping teams make data-driven decisions quickly and efficiently. 
2. Integration with enterprise systems 
   Seamless CLM integration with systems like Salesforce, Workday, SAP, and other enterprise tools ensures information flows smoothly across departments. Agiloft’s Integration Hub, for example, connects CLM platform with CRMs, ERPs, and other platforms to create a unified workflow. 
3. Compliance and risk management tools 
   Automated compliance checks, risk scoring, and alerts help organizations stay aligned with regulations and internal policies. These tools reduce the likelihood of costly fines, missed obligations, or unfavorable terms. 
4. Analytics and reporting 
   According to a CLOC survey, legal professionals spend between one and six hours tracking obligations within the lifetime of a single contract. Advanced analytics capabilities enable organizations to track KPIs, uncover trends, and identify bottlenecks.  Customizable reporting helps teams assess contract performance and optimize processes. 
5. Flexibility and scalability 
   Choose a system that can adapt to your organization’s growth. A scalable solution should handle increased contract volume, support additional users, and incorporate new features without requiring costly upgrades or overhauls. 

What to look for in a CLM demo 

A product demonstration is a crucial step in evaluating CLM vendors, offering a firsthand look at system functionality and alignment with your business needs. To maximize a demo’s value, here’s what to focus on: 

1. Tailored demonstration over a generic walkthrough 

Vendors often offer general demos, but the most valuable ones are customized. Before a demo, provide the vendor with details about your specific challenges and workflows so they can tailor the demonstration to your needs. 

Look for: 

• A walkthrough of contract creation, approval, and signature workflows relevant to your business. 
• Examples using your industry’s contract types (e.g., procurement agreements, sales contracts, NDAs). 
• A clear demonstration of how the CLM integrates with your existing tech stack.  

2. Ease of use and user experience 

Even the most feature-rich CLM will fail if it’s not user-friendly. During the demo, pay attention to: 

• How intuitive the interface is for Legal, Sales, Procurement, and Finance teams 
• The simplicity of setting up workflows and approvals without IT assistance 
• How easily users can search for contracts, track obligations, and generate reports 

A system that is difficult to navigate will lead to low adoption rates, so ensuring there is an intuitive interface is critical. 

3. Workflow automation and AI capabilities 

Automation is one of the top features to evaluate in a product demonstration. The demo should highlight: 

• How automated approval workflows reduce bottlenecks 
• The role of AI in extracting key contract data, identifying risks, and suggesting next steps 
• Whether automation can be easily configured to match your existing processes 

Modern CLM systems, such as Agiloft, leverage AI to eliminate manual work, improve compliance, and enhance contract insights—features that should be front and center in any demo. 

4. Searchability and reporting features 

One of the main benefits of a CLM system is having a centralized contract repository with robust search and reporting functions. During the demo, test how quickly you can: 

• Find a specific contract using filters like expiration dates, contract type, and counterparties 
• Generate reports and dashboards on contract obligations, renewals, and compliance 
• Set up automated alerts for upcoming renewals and key deadlines 

A strong CLM platform should make it effortless to locate and manage contracts in seconds, not hours. 

5. Integration with existing systems 

Your CLM software shouldn’t exist in a silo. Ask the vendor to demonstrate how the system integrates with your existing software, including: 

• CRM platforms, like Salesforce, for seamless contract generation 
• ERP systems to connect contracts with financial processes 
• Procurement platforms for supplier agreement tracking 

Agiloft’s Integration Hub, for example, connects with more than 1,000 enterprise systems, ensuring contracts are fully integrated into broader business processes. 

6. Security and compliance features 

Contracts contain sensitive data, so security is a non-negotiable factor. During the demo, ask about: 

• Role-based access controls and user permissions. 
• Audit trails that track who accessed or modified a contract. 
• Compliance features for industry-specific regulations like ISO 27001, HIPAA, or SOC 2. 

Ensuring the CLM meets your compliance requirements from the start will save time and reduce risks down the road. 

7. Implementation process and support 

A new CLM system should enhance productivity—not create additional headaches. Inquire about: 

• Estimated implementation timelines and resources required 
• Training options, such as Agiloft University, to ensure employees can effectively use the system 
• Ongoing customer support, including response times and dedicated account managers 

Choosing a vendor with a strong track record of successful implementations and customer satisfaction, like Agiloft, ensures a smoother transition and long-term support. 

CLM ROI and cost considerations 

Understanding the total cost and potential Return On Investment (ROI) of a CLM solution is crucial for making an informed decision. 

Total cost of ownership (TCO) 

A CLM platform’s TCO goes beyond the initial purchase price and includes: 

• Setup and implementation costs: Expenses like system configuration, data migration, and integration with other tools 
• Subscription or licensing fees: Pricing should be scalable to support future growth, such as additional users or increased contract volume 
• Maintenance and support costs: Ongoing costs for updates, technical support, and system upkeep 

Understanding these factors ensures you’re prepared for the full financial impact of the solution. 

Return on investment (ROI) 

A recent MGI report found that Agiloft’s CLM platform can deliver over 100% ROI compared to manual processes, demonstrating clear financial and operational benefits.  

By balancing TCO and ROI, you can ensure the chosen system delivers value for both the short and long term.  
 
A well-implemented CLM system can deliver measurable ROI by: 
 

• Improving efficiency: Automating workflows and reducing errors can recover up to 9% of lost revenue caused by inefficient contract management, according to World Commerce & Contracting. 
• Mitigating risks: Automated compliance checks and real-time alerts help avoid fines, missed deadlines, and unfavorable terms. 

CLM implementation and change management 

A successful CLM implementation relies on proper planning and effective change management to ensure smooth user adoption. 

Tips for implementation 

1. Develop a roadmap: Work with your vendor to create a step-by-step plan for system setup, data migration, testing, and go-live 
2. Assign roles: Clearly define responsibilities to ensure accountability and keep the process on track 
3. Leverage vendor expertise: Select a vendor with a strong track record, like Agiloft, that offers tailored guidance through its Professional Services team to ensure a seamless setup 

Managing change 

1. Communicate benefits: Build a clear business case and highlight how the system will improve efficiency, reduce errors, and simplify workflows for users. 
2. Provide training: Offer comprehensive training, such as Agiloft University’s resources, to help users feel confident and prepared 
3. Monitor and adapt: After implementation, gather feedback to fine-tune the system and ensure it continues to meet your organization’s needs 

In summary 

Selecting a CLM solution, when approached systematically, can transform contract management. By understanding needs, engaging stakeholders, evaluating vendors, and planning implementation, you’ll ensure a smooth transition and long-term success.  

A CLM system is an investment in growth, efficiency, and compliance; with the right vendor and strategy, you can unlock its full potential for sustainable business success.