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Legacy vs. New Age Contract Management – Resolving the war in Middle East Procurement
Unraveling the P2P benchmark survey findings – The visibility & compliance picture
November 28, 2014
The State of Strategic Sourcing 2014 – Part I
December 8, 2014
Having seen the challenges posed by legacy systems, let’s explore how technology can help us resolve the issues in the post-war period.
Contract Management Life Cycle
Resolving the challenges with New Age Contract Management Systems:
Challenge 1:- Low visibility
- Implement a central repository to store and manage contract information.
- Identify key terms of a contract which need to be tracked like expiry date, variations and set the respective alerts.
- Analyze the contract utilization trends which will in turn help you identify whether contract terms are being followed or not.
- Review evergreen contracts and re-negotiate terms if required.
Challenge 2:- Compliance
- Integrate your contracts with the organization’s ERP system.
- Identify purchase price compliance and rebates by monitoring purchase information with the contracts.
- Additionally, maintain a contract repository & track utilization metrics.
Challenge 3:- Standardization
- Create standardized contract templates and keep them easily accessible to the sourcing managers.
- Track what terms are negotiated most often and change them globally.
- Also define a clause hierarchy based on the different regional aspects.
Challenge 4:- Long Cycle Time
- Introduce eSignatures and avoid the hassle of manual signatures.
- Create pre defined approval hierarchy based on category, spend etc.
- Thus the written contract will automatically follow the hierarchy for approval and feedback.
- Set clause level approvals where you can define clause ownership and automate the process.
As quoted by Andy Grove, Intel – “There is at least one point in the history of any company when you have to change dramatically to rise to the next level of performance. Miss that moment – and you start to decline”.
Learn More: Contract Lifecycle Management Software;
How have you resolved a challenge? Share your views in the comments section below.
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