In an increasingly dynamic and competitive business environment, effective contract management is critical to business success and sustainability. Contracts form the backbone of business relationships, regulating rights and obligations, and ensuring compliance with legal and regulatory requirements. In 2024, the importance of contract management will continue to increase, driven by several key factors.
Organizations can save 2% of annual costs due to contract management.
Why is effective Contract Management important in 2024?
Effective contract management is becoming increasingly important as the complexity of business agreements grows. With global markets, complex supply chains and multiple stakeholders, contracts are becoming more comprehensive and detailed. This requires systematic management to avoid errors, misunderstandings and legal conflicts. Effective contract management ensures that all parties are clear about their rights and obligations, minimizing the risk of disputes.
Secondly, technological advances bring new opportunities and challenges in contract management. Tools such as ShareControl Contract, built on Microsoft 365 and SharePoint, enable the automation and improvement of many aspects of contract management. This includes everything from storing and organizing contracts to automated alerts and analytics with Power BI. Such technologies not only improve efficiency, but also ensure that businesses comply with applicable regulations and best practices.
What is Contract Management?
Contract administration or follow-up of contracts concluded with customers, suppliers, partners or employees. In contract management, the process of managing contract creation, execution and analysis to maximize operational and financial performance within an organization, all while reducing financial risk.
Challenges with Contract Management
Contract management is a complex process that can present several challenges, and these challenges can affect companies’ efficiency and success.
Read also: How technology improves contract management in your business
Lack of overview of contracts
One of the biggest challenges with contract management is the lack of overview and organization of contracts. When contracts are stored in different places and in different formats, it becomes difficult to find the necessary information quickly. This can lead to lost contracts and misunderstandings. With ShareControl Contract, you can systematically store and manage all contracts in one place, ensuring easy access and overview for all relevant parties in Microsoft 365.
Important contract deadlines
Keeping track of all contracts, important deadlines and obligations can be challenging, especially when a company handles many contracts simultaneously. Missed deadlines can result in financial losses and legal issues. To prevent contracts from being forgotten, Share Control’s contract solution has integrated alerts and reminders with Power Automate. Set up alerts via email or other messaging systems so you’re always aware of upcoming deadlines and obligations.
Explore more: What are the total costs and liabilities of your contracts?
In ShareControl Contract, the first notification is sent to the person responsible for the contract. Should the notification not be followed up, a new notification is sent to the next person on the list. This ensures that you never lose contract renewals, even with employees who have left.
Non-compliance with regulations
Compliance with legal and regulatory requirements is critical when managing contracts. Failure to comply can lead to legal sanctions and damage the company’s reputation. In Norway and the EU, recent years have seen more legal requirements that place higher demands on control over data storage from suppliers, such as the Transparency Act and GDPR. A contract management system can therefore help to prevent breaches by constantly maintaining control of signed contracts and applicable guidelines.
Looking for solutions for the Transparency Act? Share Control has developed ShareControl Transparency, which helps you gather all data related to the Transparency Act from your suppliers in one place.
Best practices for Contract Management in 2024
Effective and secure contract management is essential for any business. Here are some best practices and tips to ensure your contract management is optimized for success in 2024.
Reporting in Contract Management
Accurate and timely reporting is essential to keep track of contracts and ensure that all obligations are met. Here are some tips to improve your reporting:
Centralized handling
Use a central system such as ShareControl Contract to store and manage all contracts in one place. This provides a clear overview of all active and expired contracts, simplifying reporting.
Customized reports
Use tools such as Microsoft Power BI to create customized reports that provide insight into contract data. This can include financial performance, key deadlines and contract renewals.
Automated reports
Set up automatic reporting features that generate and distribute reports regularly to relevant stakeholders. This ensures that everyone has access to up-to-date information without manual effort.
Financial reporting
Financial reporting is a critical component of contract management, providing businesses with insight into their financial status and future obligations. To enhance this process with ShareControl Contract, Excel VBA can be integrated, providing more accurate and detailed financial forecasts. By combining Excel VBA with ShareControl Contract, businesses can benefit from the strengths of both systems.
This is how it works:
- Automation of data import: Using Excel VBA, data from ShareControl Contract can be automatically imported into Excel. This eliminates the need for manual data entry and minimizes the risk of errors.
- Customized reports: Create bespoke reports and dashboards that show key information about your contracts. This includes financial performance, cost forecasts, revenue streams and risk assessments.
- Advanced financial forecasting: With VBA, users can create advanced forecasting models that analyze historical data and estimate future financial liabilities and revenues. This provides a better understanding of financial trends and helps management make informed decisions.
- Risk management: The integration makes it possible to identify and monitor risk factors associated with the contracts. Excel VBA can be used to set up alerts and flag high-risk contracts, based on defined parameters such as late payments or imminent expiry dates.
Automation of processes
Automation is key for businesses looking to optimize their contract management in 2024. This can reduce workload, minimize errors and ensure that no critical tasks are overlooked. Here are some ways to automate processes in contract management:
- Automatic alerts and reminders: Use features like Power Automate to set up alerts for important deadlines and renewals. This ensures that all commitments are followed up on time.
- Electronic signature: Implement electronic signatures for fast and secure signing of contracts. This reduces the time it takes to enter into agreements and ensures the integrity of the documents. In ShareControl Contract, you can choose between integration with Adobe Sign or DocuSign.
- Workflow automation: Using ShareControl Contract to automate your contract management, the first step is to automate approval processes and document flow. This ensures that contracts go through all the necessary steps without unnecessary delays.
Security and privacy
At a time when data attacks and security breaches are becoming increasingly sophisticated, it’s vital that businesses take security and privacy seriously when it comes to contract management. Securing sensitive data is not only a legal obligation, but also a business-critical task that can protect your company’s reputation and financial stability. Read more about how you can secure sensitive data by digitizing your contract management here.
Strong security protocols should be implemented to protect contract data. This involves the use of encryption to ensure that data remains inaccessible to unauthorized parties, both during transmission and storage. In ShareControl Contract, this is ensured with technology from Microsoft. Access controls are also essential; only authorized users should have access to sensitive contract data. Regular security updates and audits should be carried out to ensure that systems are always protected against the latest threats.
Furthermore, all employees should be trained in data security best practices. Awareness of phishing attacks, secure use of passwords and correct handling of sensitive information are crucial to maintaining a high level of security.
ShareControl Contract
ShareControl Contract is an advanced contract management solution designed to streamline and secure contract administration. Built on Microsoft 365 and SharePoint, ShareControl Contract leverages the powerful capabilities of these platforms to provide an integrated solution that makes it easy to store, manage and follow up on contracts.
Read also: How to benefit from digital contract management?
Implementing ShareControl Contract gives you access to a range of features and benefits that improve and ensure efficient contract management:
Centralized library
All contracts are stored on the same platform, providing easy access and a better overview. This makes it easier to find and manage contracts without having to search through different storage locations.
User-friendly interface
The system is user-friendly and intuitive, making it easy for employees to learn and use it. This reduces training costs and increases productivity.
Security and compliance
Built on Microsoft’s secure platform, ShareControl Contract offers robust security features such as encryption, access controls and compliance with GDPR and other relevant regulations. This protects sensitive data and ensures your business complies with legal requirements.
Integration with Microsoft tools
ShareControl Contract integrates seamlessly with other Microsoft 365 tools such as Power BI and Excel. This makes it possible to create tailored reports, analyze contract data and gain deeper insight into financial commitments and trends.
Automated alerts and reminders
ShareControl Contract can be set up with automatic alerts and reminders for important dates such as renewals and expiration dates. This ensures that you never miss a critical deadline, which can save you significant costs and legal issues.
Increased collaboration
The integration with Microsoft Teams and other collaboration tools makes it easy for team members to work together on contracts in real time. This improves communication and ensures that all relevant parties are informed and involved in the contract process.
Secure and efficient Contract Management in Microsoft 365
The use of Microsoft 365 and SharePoint provides a robust platform for secure and efficient contract management. These solutions offer built-in security features that comply with strict compliance and privacy requirements, including GDPR. This means businesses can be confident that their data is handled in line with the latest security standards and legal regulations.
Learn more about Contract Management in Microsoft 365
