Contract management is a lengthy process that’s typically split into three main phases; pre-contract phases, contract execution phase, and post-award phase. However, numerous different stages make up these three phases. In this post, we’re going to walk you through all of these stages, so you understand precisely what goes on during contract management.
Stage 1: Preparing the Contract
The first stage is getting the contract prepared and identifying all your needs and goals, etc. Here, you will define all the risks that could present themselves, and you will essentially bring up a framework for what the contract will be about. It can take some time to prepare everything as you really need to think about all the different factors that come into play. When you’ve finally decided why the contract is being created, and the goals are set, you can proceed with stage two.
Stage 2: Generating the Contract
Next, you have to start generating the contract. This is where it helps to consult with an attorney or legal representative, so you know exactly how to draw everything up. You can use templates to make things a lot easier for you as they essentially give you a contract and you fill in the blanks to relate to your needs. By using contract management software from Symfact, you can create contracts with ease using multiple templates. It will help speed this stage up so you can move onto the next one.
Stage 3: Negotiating
After step two, you will have the first draft of your contract. Next, there will be negotiations with the other party to ensure everyone’s needs are met. They might have a few amendments that they request, and you have to review that and find common ground where everyone agrees. Again, this is where Symfact can help you with our contract lifecycle management software. By using this software, both parties can amend the contract and view the document on one platform, from different places. It enables all of you to collaborate with ease, so negotiations can go smoothly.
Stage 4: Approval
Before you can finalise the contract and start executing it, it needs to be approved. Both parties will agree on it, and then other people in both organisations will have to approve it. With contract management systems, you can send the contract to these people for approval, so they can look at it, make edits, then sign it off with their seal of approval.
Stage 5: Execution of the Contract
Everyone is ready for the contract to be executed, so both parties sign and it’s made official. Now, it’s merely a matter of carrying out the contract to the requirements laid out in it. These days, you can use secure electronic signatures to speed up the process and ensure contracts are executed without needing to send documents back and forth across the world!
Stage 6: Amendments/Revisions
It’s extremely rare for a contract to go through its lifecycle without any amendments made after the execution. Usually, either party may realise that certain things aren’t working, so they want to revise different elements. This used to be incredibly challenging to stay on top of as you’d have to go through filing cabinets to find the specific contract, then work your way through the document to make revisions, send it off to the other party, and so on. Thankfully, life is a lot easier with contract management software as you can easily find your contract via the online system, then keep up with all amendments in real time.
Stage 7: Further Management
The last step is simply undertaking further management of the contract. This includes assessing the contract to ensure that both parties are complying and keeping up with their legal obligations. But you can also take a contract and set up notifications for renewal dates via contract management software. In doing so, this ensures you don’t miss these dates and can renew contracts with ease. Also, manage the agreement by setting deadline notifications to guarantee that everything is done on time. This stage is essential for maintaining a positive relationship with the other party to help continue your professional relationship beyond this particular contract.
By looking at all seven of these stages, it might make you feel like contract management is complicated and time-consuming. In truth, this used to be the case. Manual contract management of physical documents is challenging, but life is made so much better thanks to contract management systems. By using the right software, you can streamline the entire process and stay on top of all your contracts with various parties.