How do you know if you need contract lifecycle management software? Who uses it and why? What options are available?
Contract Lifecycle Management (CLM) software is an established choice for businesses looking to gain time, clarity, and control of their contracts through the contract lifecycle from creation to renewal.
This article answers the most common questions about CLM software and its applications in your organization. If you’re interested in implementing software to improve contract processes at your business, then skip the reading and hit the button below. If you’d still like to learn more, use the links below to navigate this resource.
What is contract lifecycle management (CLM software)?
CLM software is a contract tool that aids legal and business teams in the creation, negotiation, signature, renewal and data analyses of legal contracts. It streamlines the contract lifecycle, enabling business users to self-serve, sign and manage routine contracts at scale from one unified workspace.
Legacy enterprise CLM software systems such as SAP and Ariba are still used to handle contracts, but your ability to locate, understand, and analyse the information in them remains limited. Contracts end up silos, require clause-by-clause legal review, and end up as multi-versioned Docx and PDF files scattered across shared drives.
Newer software providers are reimagining contract management, enabling the contract lifecycle to unfold as a transparent, fully integrated and automated process, every step of which is easily controlled through an all-in-one platform. CLM is changing - and Juro is at the vanguard of the providers changing it.
What is a contract lifecycle?
But what actually is a contract lifecycle? A contract lifecycle is a process through which a contract is created and managed. It involves various stages a contract must go through, from drafting all the way through to post-signature tracking.
Although certain business contracts will spend longer in certain stages of the contract lifecycle than others, most contracts follow the same vague process, and will be created, reviewed, negotiated, signed, tracked and renewed in that order.
However, since contracts are complex legal documents, it's not uncommon for them to move back and forth across the contract lifecycle. For instance, if a contract is being negotiated, it's likely that it will return to the review stage following any changes by a counterparty, where it will be approved by the relevant contract stakeholders before it can be signed - usually with approval workflows.
CLM workflow: what are the phases of the contract management lifecycle?
Disjointed and risk-prone legacy contract systems can burden lawyers with time-consuming and redundant processes, requiring extensive review (wasting even more time). Today, next-generation CLM platforms like Juro unify contract processes in one system and use automation to accelerate and streamline every phase of the contract lifecycle, including:
1. Contract creation
Without contract lifecycle management software, contracts would be authored by various different parties, each with their own unique approaches and styles, which can create risk and uncertainty. It can also mean that contracts lack coherence and appear disparate as a result.
At this stage in the contract management lifecycle, legal and business teams need to minimize risk and maintain a contract’s integrity, before a contract is passed on to the counterparty. This can be achieved with the support of contract lifecycle management software, since it delivers a more standardized approach to writing a contract, with templates and rules to refine the process.
2. Internal review and collaboration
At this stage, internal stakeholders and in-house counsel review draft contracts and contribute specialised knowledge to better align contract terms with company-wide goals.
When reviewing contracts internally, your contract stakeholders should seek ways to advance your commercial interests, and ensure that you've taken every opportunity to minimize any risks within the transaction.
Usually, CLM software delivers value at this stage of the contract lifecycle by providing intuitive commenting features, and opportunities to work together on a contract in one unified workspace, in real-time.
3. Contract negotiation
The counterparty and any relevant third parties review and revise the draft. The main goal of contract negotiation is for each party to be satisfied with the rights and obligations and ready to sign.
To achieve this goal more efficiently and with less friction, contract lifecycle management software can simplify the negotiation process, with many CLM solutions providing a detailed audit trail of any edits, suggestions and amendments made.
This enables legal teams and those they enable to quickly identify any friction points and respond to these accordingly, enabling parties to progress the contract to closing stage with greater ease.
The contract is then shared with all parties, where they are prompted to sign the agreement. Automated alerts ensure timely electronic signature in a sequence defined by the contract owner. This makes for a more convenient signing experience and empowers legal and business teams to get contracts across the line faster.
With some CLM software, you may even be able to use eSignature in Salesforce, as well as in other integrated platforms. This enables sales teams, for example, to continue working in the systems they know and love.
After signature, legal can digitally monitor the fulfillment of obligations and ensure compliance with all terms, conditions, and deadlines.
During this stage, legal and business teams can set up notifications to be triggered when certain milestones are reached and keep a close eye on the enforcement of key terms. They can also extract valuable data that can better inform the way contracts are handled in the future.
Contracts are renewed or terminated, automatically or manually, as agreed.
At this stage in the contract management lifecycle, software will typically send automated renewal reminders, allowing legal and business teams to decide ahead of time whether they'll continue a business relationship or not. This advance notice can give decision makers time to assess the value a contract has provided and determine whether the contract is suitable for your business if it's changed and developed.
Why do you need contract lifecycle management?
At some point, increasing contract volumes will outstrip your ability to manage contracts using Word, Excel and shared drives. Legal teams start to find contract process unmanageable, facing three basic but essential questions:
- Where can I find the most recent versions of contracts? Are contracts signed? Have they been amended? Where are the relevant attachments?
- What’s in my contracts? All contracts should include the most up-to-date and risk-adjusted terms.
- Who owns this contract? Who is responsible for completing required actions during each phase of the contract lifecycle?
These are the pain points that most often drive businesses to consider implementing contract lifecycle management for their document workflow.
The risks of using a manual contract lifecycle process
However, there are also some very specific risks associated with maintaining a manual approach to the contract process, including that:
📚 Lawyers are buried in low-value work
Without a robust structure and management tool in place, business teams will continue to rely on legal teams for document creation and queries, including on routine contracts. With legal's time consumed by these low value routine tasks, in-house legal teams risk missing important deadlines on higher value work.
❌ There's an increased likelihood of human error
Mistakes and errors in legal agreements can be costly. In the absence of a contract lifecycle management solution, business teams that try to self-serve on contracts can miss out on important standardized language, forget to input important data, or lose vital information. All of which can jeopardize both the contract's fulfillment and your relationship with the counterparty in the long term.
🔎 There's a lack of transparency
Today, many contracts require collaboration to get them across the line. Without contract lifecycle management in place, business contracts are often created and shared manually, resulting in lots of versions and little control. This also means that comments, amendments and changes can get lost in the manual process, creating extra work for legal teams that need to get contracts across the line.
📊 It's an inefficient way to track data
Without a single, unified workspace and automated data collection functionality, the manual contract lifecycle can result in incomplete or inaccurate data. Given that there are so many valuable contract metrics to track, this is a significant missed opportunity, and one that can cost businesses - particularly if renewal dates and potential risk areas aren't identified and addressed. It can also make contract audits extremely painful in the future.
🆕 Difficult to manage change
Manual contract lifecycles are also not very flexible, which can be a problem for complex contracts that require back and forth, various changes and lots of collaboration. Rather than quickly amending contracts, or commenting on them, your counterparties and colleagues will have to create new versions of a document, send it over and wait for the recommendation to be acknowledged.
This is distinct from where, with advanced contract lifecycle management software, contract stakeholders can redline contracts and edit them in real-time where everyone can see and respond to these changes.
Who uses CLM software?
It’s easy to think that only lawyers need contract software, but improving how everyone in your organisation relates to contracts opens opportunities for significant gains. A recent EY Law survey found that 90 per cent of business development leaders face challenges when working on contracts with their procurement, law, and commercial teams. Some 57 per cent of those leaders said inefficient processes slow revenue recognition, and 50 per cent report that inefficiencies have resulted in lost business.
Today’s CLM software digitally connects business development leaders, legal, procurement, HR, commercial teams and beyond, enabling automated efficiencies and streamlining processes to drive immediate and long-term business value.
What are the benefits of contract lifecycle management software?
Adopting a CLM platform like Juro benefits your organisation in several ways, including:
1. A self-serve contract creation process ✍️
Business users can create new contracts through a self-serve Q&A workflow to accelerate the process without needing to rely on legal. All new contracts are based on templates that use standardised, pre-approved language to reduce risks and optimise performance.
This means that commercial teams like sales teams no longer need to wait around for legal teams when it comes to closing a deal. With contract lifecycle management software and the opportunity to self-serve, legal becomes an enabler, instead of a blocker.
2. More collaborative workflows 🙏
Multiple parties can quickly review and negotiate contracts in-browser, using one unified workspace. They can converse in real time in the document sidebar and check prior versions with one click using Juro’s timeline. This collaborative experience means that there's less back and forth when it comes to reviewing contracts internally. It also means that the otherwise lengthy negotiation period takes less time.
3. Automation improves efficiency ⌛
By automating a lot of the administrative tasks associated with contracts, using software to manage your contract lifecycle makes the process more efficient for everyone involved. For instance, contract automation software means that users benefit from:
Automated alerts, routing and escalation procedures ensure the appropriate parties know when action is needed.
Informative, customised dashboards keep you up to date on and in control of every contract.
- Automated tracking monitors milestones and deadlines to avoid costly oversights.
4. Quick and easy access to contract data 📊
With CLM software, contracts tend to live in a data-rich repository where they are easily searched, audited, and analysed at any time. The software typically collects and collates data throughout the entire lifecycle, with each element of the contract captured as structured data, making it easy to search and query.
Over time and as your contract portfolio increases, you can use data analytics to build more efficient contract processes, inform your strategy and create contracts that drive better business outcomes.
5. Integrate with the platforms you love 🔗
One of the biggest benefits of CLM software is that you can integrate it with existing programs to eliminate manual data retrieval and entry tasks. Automating data exchange saves time and effort while ensuring contracts contain accurate and up-to-date information.
For instance, Juro integrates with the likes of Salesforce, Workday, Zapier, Greenhouse and more to ensure that legal teams and those they enable can manage contracts without having to leave the platforms they love.
6. Enables you to align your resources better 👩💼
With low-level administrative tasks handled through automation, your legal team can focus on its KPIs and spend much more time on more strategic and impactful work.
This is vital since Juro's recent Tech GC report revealed that 69% of in-house legal teams were buried in low-value work. By alleviating this pressure on legal teams, they can return to the work they're trained to do and find more fulfilment in.
How do I implement CLM software?
To implement contract management lifecycle software successfully you need a clear idea of the problem you're trying to solve, concrete objectives, and buy-in from the wider stakeholders who'll be using the solution once it's rolled out.
There are a couple ways to help ensure CLM software is adopted and used to its fullest. Your first project should quickly demonstrate the value CLM software can bring to an individual’s work life. We find that customers often have great success starting small with a defined project, such as automating the NDA workflow, or partnership agreements, before moving on to a company-wide deployment having proved value.
Secondly, you can ensure adoption by integrating your CLM software with your current software systems. People are more likely to use CLM software when they access it from an application they’re already using. Standard integrations include Workday, Salesforce, Slack, GDrive and Box.
Contract lifecycle management solutions
Legacy CLM platforms primarily target large enterprises and are priced accordingly. They often require significant upfront investments in costs and training - many of them advertise that they might get you to value within six months.
At Juro, we think a six-month implementation period is nothing to be proud of! That's why we offer an intuitive browser-based interface that people jump in and use immediately. Juro is free to try and has a typical implementation time of 21 days. Users create, negotiate and sign contracts using a single all-in-one platform, instead of moving into Word, GDrive, or DocuSign, creating friction and losing audit trails and data.
"We've created a workflow that is scalable, quicker, automated and allows other teams to self-serve their contracts. For a small legal team this is essential and has saved us so much time"
"Easy to learn, intuitive user interface, anyone can use it without training. The Q&A function is amazing and let me as a legal person focus on contracts which actually require my expertise in drafting and negotiating. The future is here!"
"Juro's platform has significantly improved the efficiency of our legal function and has enabled our legal team to spend more time focusing on high-value work"
CLM use cases and case studies
CLM software offers the quickest ROI when you automate low-negotiation, high-volume contracts such as:
- non-disclosure agreements (NDAs)
- master service agreements (MSAs)
- employment offer letters
- option agreements
- vendor agreements
- partner agreements
Here’s a look at how contract lifecycle management works in practice, and just a few of the benefits customers have gained.
⚙️ Automate NDAs
RVU, a company behind a series of comparison businesses, uses Juro to automate the self-serve generation of NDAs from templates. Business users approve NDAs in a browser-based workflow and sign NDAs online, ultimately enabling the legal function to save up to 30 per cent of its time.
“With Juro doing the heavy lifting on low-negotiation contracts, I had the breathing space to be more strategic, which included securing an excellent first hire into my team.” — Michael Haynes, Head of Legal, Cazoo
⚙️ Automate MSAs
Automate MSAs using a preset approval workflow with defined roles for legal and CFOs as well as signatories. Sequential workflows automatically notify multiple approvers in a specific order. Payments company Shieldpay uses Juro to reduce the time it takes to generate contracts from several days to several minutes.
“We’re saving so much time. Our clients see us as understanding, with quicker turnaround times and faster execution - thanks to Juro” — Willem Wellinghoff, Chief Legal and Compliance Officer at Shieldpay
⚙️ Automate Offer Letters
You can expect to generate, issue and secure signatures on an offer letter in less than one hour. Automated workflows allowed online food delivery company Deliveroo to issue 1400 employee letters across 13 markets in 2 weeks while reliably tracking acceptances from each recipient.
“Juro was fit for purpose across all markets – we were even able to input foreign language versions, including Italian, Spanish and French. That was a great outcome - we could communicate with local markets and meet local legal obligations” — Cameron Russell, Senior Award Analyst at Deliveroo
For more information on CLM software, additional benefits and use cases, check our contract management software explainer. Need to convince stakeholders to invest in better contract processes? Use this free business case template.
What are contract lifecycle management best practices?
Great, so say you have a contract lifecycle management software in place already. How can you make the most out of the solution and create a truly frictionless contract process? Here are a few contract lifecycle management best practices that may come in handy.
🗄️ Set up a template repository
If your CLM software allows, set up a single, central location for all of your contract templates to be stored, ready for use. As your use cases expand and the volume of contracts being processed increases, you'll be able to accumulate efficient contract templates over time, allowing you to quickly and efficiently generate a contract as soon as a request is made.
👩🏫 Enable business teams to self-serve on routine contracts
By creating a playbook or some other guide, determine when a contract will be delegated to a commercial team, instead of being actioned by the legal department. For example, you should establish which routine, standardized contracts can be self-served on, and whether contracts that meet a certain value threshold should be passed over to legal. By setting this up, you can quickly decide who is responsible for a contract and set up any safeguards to accommodate this.
📝 Facilitate standardization
Set up standardized templates that can eliminate the need for excessive data entry, inconsistent formatting, and repetitive drafting. If your contract lifecycle management software has features like conditional logic and access controls, legal teams can rest assured that contracts handled by business teams carry less risk and require less time for reviews.
👥 Set up a collaborative workflow
According to research by McKinsey, improved communication and collaboration through social technology, like CLM software, can increase the productivity of interaction by between 20 to 25%. To facilitate this collaboration, it's important to make the most out of the features offered by your contract lifecycle management software. This can mean encouraging collaboration to happen through internal and external commenting threads, working on contracts together in real-time and setting up notifications to remind users to action certain tasks.
✅ Mitigate risk using approval processes
If your CLM software offers the ability to set up approval processes, use them. Approval processes ensure that legal teams can maintain control over the contracts managed by business teams and that they get the final say on certain clauses and in high-value negotiations. Utilising this feature allows legal teams to mitigate risk whilst also working on higher-value work.
📈 Track vital contract data
A wealth of data can be collected from contracts, including post-signature. If you have a CLM that allows you to query, collate and report on contract data, then it's worth tracking certain metrics, like renewal dates, turnaround time, and cost per transaction.
Do you need contract lifecycle management software?
You’re in an ideal position to benefit from an all-in-one CLM software solution like Juro if:
- Your company enters into ten or more contracts a month, and the volume is increasing.
- Contract outcomes affect revenue.
- The majority of the contracts you're looking to manage are low-negotiation.
If this sounds like you, then hit the buttons below to find out what contract lifecycle management could do for your business.
How to choose the right contract lifecycle management software
Once you've recognized the value that a contract lifecycle management software could bring to your business, you then have to decide which solution is right for you. Certain solutions are better for storing documents, whilst others are particularly effective for collaboration.
When deciding which contract lifecycle management software is most suitable for your needs and use cases, consider the following things:
- Workflow stages. Which contract workflow stages does the solution cover, and how effectively? If you need a solution that will streamline the entire process, find one that can add value at every stage of the contract lifecycle.
- Complexity of your contracts. How complex are the contracts you want to manage using the solution? Are they standard agreements, or are they more complex? Different solutions will be stronger with different contract types, so consider what your use cases require.
- Your need for collaboration. Are contracts in your business a solo effort? Or are they something that different departments and members of the legal team collaborate on? If your contract workflow involves a lot of collaboration, look for contract lifecycle management software with access controls, approval workflows and intuitive commenting features.
- Integrations available. Would you benefit from integrating your CLM tool with another platform like Salesforce or Greenhouse? If so, find a contract lifecycle management software that integrates with the CRM and task management tools you use regularly.
- Implementation time. How soon would you like to get value from the software? Whilst some enterprise-minded solutions can take up to a year to implement, alternatives like Juro can take just 21 days.
Having considered all of these things, you should be able to identify the perfect CLM software to suit your specific requirements.
If you find yourself in need of a contract lifecycle management software that adds value at every stage of the contract lifecycle, has a fast implementation time and enables advanced collaboration, hit the green button below to find out more.