Around 80% of all business-to-business transactions are based on legally binding contracts. Most contain clauses and conditions that need to be managed to maximize returns and minimize cost and risk. Yet many companies lack a process for active contract management. They are often placed on a file server or in a filing cabinet, where they do not come to light until problems arise or the validity period has expired.
It is no longer sufficient to be able to produce a contract signature at the request of an auditor. Organizations will increasingly need to provide evidence that they have control over their entire contracting process. This includes both the drafting and the filing and management, if they are to comply with, for example, U.S. SOX (Sarbanes-Oxley Act) or EuroSOX.
The five most important factors in contract management
When designing CANEA Document, one of the five modules of CANEA ONE, we considered these five key components in all contract management:
• Overview of all contracts. • Efficient creation and management. • Alerts and reminders. • Security and storage. • Support for the entire life cycle.
With the help of contract management in CANEA ONE, we are now able to meet the information needs of the organization and management is now not as person-dependent as it was before. In addition, it is much easier to find your way through all the contracts.
Helen Hagberg, Fristads AB
Common problems in contract management
It is very common for an organization to have several different contract management systems, yet no effective contract process. And there is often no method to ensure that contracts are renewed or terminated on time - no notices are sent - leading to lack of service, missed deliveries and unnecessary costs. Other problems we have seen over the years:
Wrong version of contract sent out for signature due to lack of version control.
Unclear who owns the relationship in a contract and who is responsible for the contract.
It is difficult to determine whether a contract is being renewed, terminated or adjusted and, if so, how far along the process it is.
Softer values and history related to the contract - such as emails - "disappear" after the contract is signed, as the information is not stored.
It can be difficult to understand wording in contracts that are a few years old.
Difficult to enforce a common and quality assured process.
How we can help you
Don't despair - we have the solution to the above problems. Our business management system CANEA ONE stores all contracts in one place and makes them searchable on metadata. This ranges from supplier agreements, customer agreements and employment contracts to partner agreements, GDPR agreements and Non-Disclosure Agreements (NDAs). Deadlines for contract renewals and terminations are documented per contract and reminders are sent to the relevant persons. New versions activate alerts to let interested parties know what is going on. CANEA ONE has more benefits:
Standardize the production of new contracts and facilitate initiation and creation based on templates. Permanent access to the latest version to work from. Provides both higher quality contracts and ensures compliance through review and approval processes.
More automated process all the way from creation, referral and signing to updating, follow-up and finally archiving. Streamlines and creates easy compliance with the agreed contract process and all phases of the life cycle.
Automatic contract monitoring and follow-up with reminders for renegotiation and termination. Manage contract periods, termination periods and monitoring dates and get a full overview of when contracts expire or are up for renewal.
Secure storage of all agreements. Read and write permission settings control access to agreements at both role and individual level. Support for both draft and version management. Full traceability of all changes and comments around agreements.
Filter, categorize and sort contracts in any way you like and find all contracts easily with powerful search functions. Provides full control and visibility of all your contracts/agreements through clear reports and dashboards
You get a complete solution for contract management that is integrated into the management system and is easy to maintain and change when needed.
Full control of who signed which contract and when.
Full control of when contracts expire or need to be renewed.
Easy access to all contracts in one place.
Delayed renewal or unnecessary costs in terminating contracts become a thing of the past.
Everyone follows the common process for producing and monitoring contracts.
All in all, it increases revenue and reduces risk and hassle costs. For the benefit of both working environment and reputation.
CANEA knows contract management
To succeed in contract management, the way you work needs to be adapted to your organization's needs and situation in terms of resources, activities and information, for example. We have many years of experience in managing contracts and offer not only complete IT support, but also knowledge in the form of training and skilled consultants.
We've been helping businesses improve for more than 30 years. Contact our sales representatives for pricing or to get more material on CANEA's methodology for creating live and effective management systems that meet all the requirements of various standards.