In this contract lifecycle management series, we have discussed the first seven stages that occur within the lifecycle of a contract. These stages include the following:
Stage #1: Contract Request
Stage #2: Contract Authoring
Stage #3: Contract Approval
Stage #4: Contract Execution
Stage #5: Contract Storage
Stage #6: Records Management
Stage #7: Search and Retrieval
The next stage in contract lifecycle management is the reporting and data analysis stage. This stage is critical to making wise business decisions, gaining insights on digital contract performance, and strategizing the next steps for your contract management system.
Content-
- Stage #8: The Reporting and Contract Analysis Stage
- Why Reporting is Key to Successful Contract Management
- What is Contract Analysis
- How does Contract Analytics work?
- Data Analysis and Your Contract Management Dashboard
- The Advantages of A Comprehensive Contract Dashboard
- 10 Important Questions That Your Dashboard Can Answer
- Gain Valuable Insights Instantly
- Best Practices for Contract Reporting & Analysis
- Conclusion
Stage #8: The Reporting and Contract Analysis Stage
This stage of contract lifecycle management focuses primarily on the effective retrieval of digital contract data so that accurate and in-depth contract reports can be developed. Data is additionally analyzed to aid in decision-making, risk mitigation, and contract optimization. Contract management software systems provide custom reporting and data analytics capabilities so that you can gain valuable insights on each stage of every digital contract’s lifecycle.
Managing contracts post-execution is streamlined with advanced software features, allowing contract managers to save time when creating reports and analyzing contract data on several departments involved in their lifecycles (i.e., legal, sales, etc.). With detailed and user-friendly data analysis features always available, you can view the duration of digital contract lifecycles, savings, renewal statistics, sales metrics, and other data points on the effectiveness of your contract management processes.
Why Reporting is Key to Successful Contract Management
Reporting is key to successful contract lifecycle management. Your contract management team needs to be able to access reports on demand based on various digital contract types. In addition, tracking the access history and version change history of your documents is very important. Generating reports based on compliance with contractual obligations helps stay aware of how your contracts are performing. Consider items like contract changes, breaches of contract, and late payments—all of which can be tracked and flagged with detailed reporting features.
1. Monitor KPIs and Improve Processes
You mustn’t lose sight of your contracts, that’s why consistently monitoring and setting KPIs is the key. To optimize your contract lifecycle management, you can set specific KPIs to oversee how each contract is performing. In addition, contract reporting features will help you improve your processes by collecting data that will help you both strategize and make the best choices for your system moving forward. This may lead to improvements like reduced contract lifecycles, faster negotiation and approval times, increased compliance, increased contract accuracy, and saved time, money, and resources.
2. Identify Emerging Patterns and Trends
A custom reporting feature can help you identify any emerging patterns and trends in your contracts, allowing you to make the most of your data and plan for the future. One scenario where using contract trends can help is when making decisions regarding which contracts to renew and which to terminate. If a given contract’s renewal date is approaching, leverage your custom reporting features to see if similar contracts have performed well previously. If so, you can feel more confident in your choice to renew it.
3. Proactively Manage Deadlines
Missed deadlines and forgotten auto renewal and expiration dates can lead to some of the most detrimental repercussions to an organization. To ensure you never miss a key date or deadline again, we recommend leveraging the reporting feature of a contract management software solution so you can keep everyone in the loop. Ever wonder what the timeframe of an opt-out window is on a certain contract? Well, you can easily find those dates in your contract management software so you don’t have to worry about an auto renewal. By keeping tabs on all of your key deadlines, you can gain contract control and save money, rather than waste it on contracts that aren’t ideal. The reason why contract reporting can be so advantageous in terms of tracking your deadlines is because your reports contain every upcoming date in a single place. For example, you can run custom reports on all of your contracts to identify which ones expire in 30-, 60-, and 90-day intervals. With automated reminders and alerts, you can keep everyone reminded of their responsibilities, obligations, and milestones for their contracts.
4. Contract Portfolio Overview
Reporting is important for knowing what is happening with your contracts at all times. Monitoring contract performance, location, status, and entire contract lifecycles is critical to understanding what next steps to take and what responsibilities might need to be shifted. Your contract management software’s custom reporting feature gives you the ability to standardize your reporting by automatically scheduling custom reports according to certain data tags. In this manner, you can run monthly and quarterly reports discussing items like opt-out windows, active contract performance, risky-clause management, required legal reviews, and vendor agreement performance. By generating custom reports on an automated schedule, you’ll ensure that your teams have access to all the data they need to make intelligent contract decisions.
What is Contract Analysis
Contract analysis involves reviewing and analyzing contracts to extract actionable insights. It entails elaborately examining the terms, clauses, and obligations outlined in a contractual agreement to track relevant data and values.
Analyzing the content of contracts throughout the lifecycle goes a long way in identifying chink in the armor. They can pinpoint potential threats, openings, and strategies for enhancing company performance. Traditionally, contract analysis was a manual and time-consuming task. This approach is prone to errors and oversights. However, with advancing technology, especially the rise of artificial intelligence and machine learning, contract analysis is now more efficient and accurate.
How does Contract Analytics work?
One of the greatest benefits of using a contract data analytics tool is the awareness of potential gaps and areas of growth, allowing you to make informed changes and reduce unnecessary costs. By consistently analyzing digital contract data, you can pinpoint where production is lacking, where time is being mismanaged, and where compliance is substandard. We highly suggest making contract audits a standard and scheduled practice so you can ensure that your processes are compliant. Auditing your contracts also helps to reduce financial, contractual, and operational risks. Our contract management solution provides comprehensive audit trail capabilities so you can safeguard your contract management process.
Any contract manager and business owner would want to know the location, status, and performance of their digital contracts at all times. Manually monitoring and tracking contracts is a lengthy and disjointed process, but contract management software solves this problem. Contract management software can seamlessly track and organize your contract data into detailed reports so you can easily view contract progress and make decisive decisions. With accessible and user-friendly digital contract dashboards, analyzing data and viewing your reports in real time is easy.
Data Analysis and Your Contract Management Dashboard
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With your dashboard, you can analyze data and see exactly how to improve your business’s contract lifecycle management system. In this way, you can analyze and learn from previous experiences, and use that data to improve systems as you move forward. On your dashboard, you can accumulate contract data to be shared with your legal department.
Because contract lifecycle management is the combined effort of various departments such as operations, sales, procurement, etc., your dashboard will include pieces of data that aren’t necessarily the most relevant to your legal department. With your Dock 365 dashboard, you can collect digital contract data for your legal team that is most relevant to their contributions. Your customizable dashboard is a wonderful solution that can be tailored to fit your unique business needs.
The Advantages of A Comprehensive Contract Dashboard
A key advantage of a comprehensive contract dashboard is the ability to identify trends in your contract management procedures. You can gain a broad overview of each stage of every digital contract’s lifecycle. During the contract lifecycle, Dock collects data and measurements regarding your how individuals and teams are collaborating on each document. Furthermore, your contract management system is equipped with advanced search and custom filter functionalities that provide ease in locating data and contract terms and clauses. Generating charts, graphs, and reports is rapid and accurate with Dock.
When analyzing data and generating reports, you must identify the key pieces of information that will help most with developing strategies to improve internal functions and operations. This can be done by configuring your dashboard appropriately. Your elaborate contract management dashboard is complete with all of the most important insights, like digital contract lifecycle duration, quantity of contracts, and other key metrics. With constant visibility over your company’s contracts, you can pinpoint where you can increase efficiency and improve risk management and compliance.
10 Important Questions That Your Dashboard Can Answer
- Where are bottlenecks occurring within our current contract lifecycle management process?
- What is the average time that it takes to finalize a contract?
- In terms of contract negotiations, which type of contract is negotiated most often?
- Which contract clauses are negotiated most often?
- What is the status of actions to be taken by a counterparty?
- Which contracts have an upcoming renewal date?
- Which contracts have an upcoming expiry date?
- Which contracts have performed the best in the last 6 months?
- Which contract clauses have performed the best in the last 6 months?
- Where are areas of risk exposure present?
Gain Valuable Insights Instantly
By analyzing your digital contract data, you can focus your efforts on the areas of need first and foremost, prioritizing certain tasks according to a comprehensive assessment of the performance of your contract lifecycle management system. In addition, having this holistic overview of your contracts can help you to drive strategic business decisions. With your dashboard, you will have the status of your contracts displayed according to whether they are active, pending, or expiring. You can also enable automated reminders to notify you of incoming due dates so that the appropriate departments and individuals can take proactive actions. In this way, you can increase the efficiency of your negotiations and keep your teams on track.
Your dashboard serves as a place to derive the most accurate and up-to-date contact insights and knowledge. Easily extract contract metrics from the very beginning of contracts, all the way through their lifecycles to the very end, allowing you to analyze milestones and each action involved. Analyze data to optimize contract management to your business’s advantage so that make the most well-informed business decisions. Your dashboard with Dock is constantly available with clear information that will help you gain an understanding of your contract management processes, allowing you to learn how exactly you can improve your organization’s contract lifecycle management as you move forward.
Best Practices for Contract Reporting & Analysis
Earlier, companies had to spend hours poring over contracts and manually extracting critical information for analysis. They are hardly viable for scaling organizations with large and complex contract portfolios. Fortunately, today's modern tools help speed up contract analysis while maintaining quality. Here are a few tried and tested strategies to streamline contract analysis for businesses of all sizes and purposes.
Centralize Contract Storage
A fundamental prerequisite for efficient contract reporting and analysis is visibility. However, storing contracts as physical documents or across different folders and drives can slow down accessibility. That is why businesses must store all their contracts and related data in a single location within a centralized repository. It enables parties to access documents and data for analysis without effort.
For instance, Dock 365 contract management software provides a cloud-secure repository to store, organize, and search legal documents. It has sophisticated search features that enable speedy retrieval of particular contract terms and clauses, along with pertinent dates and milestones. Thus, businesses can examine, extract, and review contracts for analysis with little effort.
Automated Data Extraction
One of the main components of contract analysis is gathering pertinent information from contracts. Manually retrieving and reviewing data from voluminous legal documents can be time-consuming and resource-intensive. Hence, businesses need tools to automate contract data extraction.
Dock 365 leverages machine learning algorithms and natural language processing (NLP) capabilities to quickly analyze and extract relevant data from contracts with high accuracy. Users scan through vast amounts of text, identify clauses, dates, obligations, and other details, and extract them in a fraction of the time it would take a human. It speeds up the process of contract analysis and reduces the risk of human error.
Contract Reminders
Missed deadlines can have severe consequences for any organization. Contract analysis allows businesses to extract and examine relevant deadlines and milestones. However, Dock 365 takes it one step further.
In addition to retrieving essential dates, users can create automated reminders with our all-in-one platform. Stakeholders will receive timely alerts for renewal deadlines, payment due dates, and milestone events. It helps companies fulfill their contractual duties promptly and prevent costly disputes or legal issues.
Role-based Permission
Contract analysis involves going through legal agreements to obtain actionable insights. However, everyone in an organization mustn’t access this information. That is why businesses must take steps to restrict visibility to avoid unauthorized breaches.
Dock 365 does that with Microsoft’s top-notch security and compliance. The centralized platform ensures that only authorized personnel can access sensitive contract data. Thus, businesses can restrict access to specific departments and teams. It reduces the risk of data breaches and unauthorized changes. User permissions allow companies to control who can view, edit, or delete contracts with user permissions. It adds an extra layer of security to their contract analysis process.
Conclusion
The reporting and data analysis stage of contract lifecycle management is central to the long-term success and strategic management of your company’s contracting processes. Here at Dock, we can help you optimize this very stage of contract lifecycle management in a way that is suited to your company’s unique business needs and objectives.
The Dock 365 Contract Management System provides powerful and productive contract management, especially in the reporting and data analysis stage of a contract’s lifecycle. Dock works to streamline and simplify your contract management process for every individual and team involved so that work can be completed as productively and efficiently as possible.
Continue your exploration of Stages of Contract Lifecycle Management with Dock 365 - Contract Expiration or Renewal.
If you would like more information, we welcome you to schedule a free demo with us today.
