Where does contract management software fit into the picture? How will it help or hinder your goals? Keep reading to find out.
Understanding Contract Management Software
Contract management software is a program or series of related programs for storing and managing legal agreements: contracts with vendors, leases, licensing agreements, and the like. At its most basic, contract management software is an electronic version of a filing cabinet. It supports the entire customer and contract lifecycle, covering any process that contributes, creates, or utilizes contract data.
The best contract management software streamlines admin tasks and reduces overhead by providing a single, unified view of each contract’s processes. Contract management software is typically designed with one focus in mind: contracts. Consequently, it can offer some unique contract-focused functionality that may not be present in more generic content management systems.
Why Banks Can't Rely on Contract Management Software Alone
1. Its Functionality is Limited
One benefit of using contract management software is that it provides one source for all of your content, including contracts. However, you may miss out on some key contract analytics functionality, including:
1. Duplicate/ROT detection and remediation
2. AI-assisted Classification based on internal contract contents
3. Metadata enrichment with data intelligently extracted from the contracts themselves
4. High-quality OCR for any non-searchable legacy or third-party contracts
5. Advanced analytics, including signature, strike-through detection, and detailed document comparison
Many contract management solutions don’t deliver the capabilities needed to gain deep insight and identify opportunity or risk, such as the ones listed above. Contract management software addresses the broader challenge of managing the contracting process—contract creation, modification, distribution, signing, approval—but may not provide the deeper contract analytics needed for maximum ROI.
2. It Can't Handle Legacy or Third-Party Content
Most contract management vendors focus on the contracts that start or end their lives within the system but struggle to deal with legacy contracts and third-party content.
Overall, contract management software isn’t built with preexisting and legacy contracts in mind.
3. It Has "Repository-Itis"
Contract management software, similar to content management software, are often siloed and have blind spots for the myriad content not fully managed by the system. These solutions have decent control over content managed within the repository but lack the access and oversight into contracts that exist in other departments or systems.
The Final Verdict
Contract management software streamlines admin tasks and reduces overhead by providing a single, unified view of each contract’s processes. It can also offer some unique contract-focused functionality that may not be present in more generic content management systems. However, contract management software can’t uncover contractual opportunity or risk, nor will it discover, ingest, analyze, or enrich your contracts. If you wish to gain deeper insight into contractual opportunity and risk—and go a step beyond simply managing the contract process—look to contract analytics software.