Each time you pick up the phone, draw out an email, or click on a website “subscription” you and your company are in fact entering into a legal agreement with another company. You’re making a contract Nowadays, on average, the individual makes a contract once every two weeks. Whether they know they are entering into one or not.
Companies, depending on their size, may enter into one every other day. The bigger the company, the bigger the collection of contracts — with their life cycles, and clauses, and deadlines, and addendums, and whatnots. And each one is a crucible when it comes to understanding its ins and outs, and their negotiations. Contract negotiation, for example, is a complex and time-consuming process that businesses of all sizes encounter. According to industry research, companies spend an average of 15-40% of their time on contract-related activities.
This includes drafting, reviewing, and negotiating contracts. It’s a manual and oftentimes mind-numbing process. Thankfully, the advent of contract negotiation software has revolutionized the way legal departments handle contract amendments. In this article we’ll explore how the use of such cutting-edge software can streamline and enhance the contract amendment process, making it more efficient and effective.
The Importance of Efficient Contract Amendment Processes
Efficient contract amendment processes are essential for businesses to adapt to changing circumstances, address unforeseen issues, and ensure contract compliance. They are the guidelines, the rule books, the very manuals by which your business, well, does business. A well-structured and streamlined amendment process helps companies maintain healthy and dynamic relationships with their partners, mitigate risks, and seize new opportunities. Nevertheless, traditional contract amendment processes often face significant challenges.
Challenges in Traditional Contract Amendment Processes
Let’s take apart and digest some of the uphill battles your legal department has to traverse every time they have to face a negotiation.
- Manual workflows: Traditional contract amendment processes typically involve manual tasks — such as printing and physically exchanging documents, resulting in time-consuming and error-prone workflows.
- Lack of collaboration: Communication and collaboration among multiple stakeholders involved in the amendment process, such as legal teams, business units, and external parties, can be challenging to coordinate and manage effectively. The truth is that most folks are reticent when it comes to broaching a new communication channel. This is why companies like Slack exist — to center everything into one platform. It is also one of the reasons why companies don’t readily adopt such tech wonders — the individual is hard-pressed to abandon what they already know. In other words, you’ll have folks making amendments through SMS, others through emails, others directly on the contract, etc.
- Version control issues: With traditional methods, tracking changes and maintaining accurate versions of the contract during the amendment process can be difficult — this oftentimes leads to confusion and potential errors.
- Time constraints: Contract amendments often require quick turnarounds to address pressing issues, but manual processes can cause delays and hinder timely resolution. Sometimes a negotiation is on the line, and folks are quite literally waiting for that contract.
- Limited visibility: Without a centralized system, tracking the progress of contract amendments and accessing the necessary information becomes cumbersome, leading to inefficiencies and potential miscommunication.
How Can Contract Negotiation Platforms Address These Challenges
Contract negotiation software, also known as a contract negotiation platform, is at its core digital solution designed to streamline and optimize the contract amendment process. It is an app/platform/software solution. It offers a range of features and functionalities that specifically address the challenges faced by businesses in traditional contract amendment processes.
Contract negotiation solutions simplify the whole amendment process by providing a centralized and collaborative platform. A one-stop shop for all your contract needs. It enables all stakeholders, all your team and trusty staff, to access the contract in real-time, view proposed changes, and contribute their input seamlessly. Not only that but with automated workflows, contract negotiation software ensures that the amendment process follows predefined steps, eliminating manual and error-prone tasks. It edits out your biggest risk factor — human error, making them obsolete.
Features of Contract Negotiation Platforms
Contract negotiation software offers several key features that facilitate efficient contract amendments:
Automated workflows
Today, automation is the magic word every company strives for. The more automated their process is the better. Contract negotiation solutions automate repetitive, oftentimes archaic and manual, tasks and guide users through predefined workflows. This ensures consistent and efficient amendment processes. It eliminates the need for manual tracking, reminders, and notifications, saving time and reducing errors.
Change tracking and version control
The software enables users to track changes made to the contract during the amendment process. Like current documentation and word processing software, individuals can visualize what has been adjusted and by whom. It maintains a comprehensive history of amendments, ensuring full visibility and accurate version control. This feature helps users understand the evolution of the contract and reduces the risk of conflicting or outdated information. It also keeps everyone honest.
Collaborative editing and commenting
Contract negotiation software allows multiple stakeholders to collaborate on the same document simultaneously — different staff, from different parties, can talk, chat, and highlight sections in real-time. This gives the whole process a different flow. Users can make edits, leave comments, and discuss proposed changes simultaneously — creating the contract faster and with greater ease. This promotes efficient communication and collaboration, ensuring that all parties involved are aligned and informed.
Document comparison
The software provides advanced document comparison functionality, allowing users to easily identify changes between different versions of the contract. You and your staff can easily pick apart what differs from the current version and how it has improved over its forefathers. This feature optimizes the review process and reduces the time spent manually comparing documents.
Approval workflows
Contract negotiation solutions facilitate approval processes by defining roles, limiting responsibilities, and optimizing the approval paths. It ensures that amendments undergo the necessary reviews and checks and balances from relevant staff members.
Document storage and accessibility
Contract negotiation software offers a secure and centralized repository for contracts and associated documents. Not only giving your staff member continued access from multiple devices to their contracts, but ultimately securing them like the IPs contracts are. This enables easy access to historical contract data, supporting efficient referencing and reducing the risk of information loss.
The Benefits of Using Contract Negotiation Software for Contract Amendments
- Improved efficiency: Contract negotiation platforms streamline the amendment process. This ultimately and thankfully reduces the time and effort required to reach mutually acceptable terms between the parties. The software automates manual tasks, minimizes errors, and ensures consistent workflows. As a result, you’ll be looking at faster and more efficient contract amendments.
- Enhanced collaboration: the software enables real-time collaboration, facilitating faster decision-making and reducing miscommunication.
- Reduced errors and risks: With automated workflows, change tracking and version control, contract negotiation software minimizes the risk of errors and discrepancies. The software provides a clear audit trail, ensuring that all changes and approvals are documented accurately. You’ll know who fowl up, if it ever comes to that — which gives you more oversight and studies have shown that folks that feel supervised tend to focus more on their job and are less prone to make mistakes.
- Increased visibility and transparency: Contract negotiation solutions provide clear visibility into the progress of contract amendments. You’ll be able to track the status and history of changes. This transparency improves accountability and facilitates effective communication among team members.
- Compliance and auditability: Contract negotiation software helps businesses adhere to regulatory requirements and internal and external policies. Not just the values and terms of your business, but those that have to do with regional laws and legal precedence.
- Time and cost savings: By eliminating manual processes, reducing errors, and expediting the amendment process, contract negotiation software saves businesses time and resources. It enables legal teams to focus on high-value activities and strategic initiatives.
Taylor is a freelance SEO copywriter and blogger. His areas of expertise include technology, pop culture, and marketing.
