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Contract Intelligence Blog
Feb 01, 2022
How Contract Data Can Empower Technology Companies to Manage Risk in 2022
Innovation is paramount in the technology sector, where solutions and services move and evolve at lightning speed. Therefore, technology organizations must continuously strive to be more agile and resilient to keep up with the pace of business and stay ahead of the competition.
The commercial models in the technology industry are highly complex, with indirect sales through channel partners and systems integrators. It also encompasses complicated licensing agreements tied to subscription “as-a-service” cloud offerings and hardware purchases or leasing that can make the net profitability of a deal challenging to calculate and optimize.
In an industry marked by enormous opportunity and fierce competition, technology companies, and sales teams in particular, must work fast and deliver—all while managing risks that can bubble up from across the enterprise. These include financial risk, reputational risk, or regulatory risk. These risks are compounded by the global nature of business today.
As software and hardware companies enter complex sales deals at scale, potential failure points can exponentially multiply as relationships are built, expanded, and evolved. These inefficiencies impact not only the contracting team but also the organization’s very mission. That’s why any efforts to address the biggest challenges facing today’s technology companies must include reimagining how you manage and get value from your contracts.
How Contract Intelligence Drives Business Performance for Technology Companies
One emerging solution that mitigates contract-related risk is contract lifecycle management (CLM) software. CLM allows organizations to turn their contract repositories into the single source of truth for business risk, compliance, and performance.
Already being adopted by leading technology companies, including Microsoft, Pluralsight, and ServiceNow, advanced CLM technology digitizes the critical information in contracts, then structures and connects it to the systems that contracts touch to move faster, realize value, and drive compliance. We call this contract intelligence.
Contract intelligence has proven to be a must-have for these and other technology leaders due to contracts’ ubiquitous and foundational nature. By offering a 360° view of contracts and relationships, contract digitization overcomes the complexity of the technology partner ecosystem, providing holistic visibility into partner, reseller, and distributor relationships and contract agreements.
Only by digitizing contracts can all obligations be tracked in real time, ensuring regulatory compliance while fulfilling your commercial agreements. Integration between contracts and finance systems keeps the organization on top of required payouts, discounts, and rebates. Risk-assessment factors and incentives can be dynamically monitored; integration with Dun & Bradstreet (D&B) risk and financial analysis can alert companies when customers pose a higher risk and suggest contract language to mitigate it.
This kind of contract intelligence is increasingly important given the complex regulatory environment in which technology companies operate—one that continues to become stricter and more complicated. The focus on personally identifiable information (PII) in regulations like the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) is one example. Such regulations increase the risk of noncompliance if partners and customers don’t have a firm grip on their responsibilities.
How Icertis Contract Intelligence Can Help
Icertis Contract Intelligence (ICI) is an enterprise contract management solution that enables technology firms to get the most value from their contracts and the contracting process.
Providing a single source of truth for all client, supplier, and vendor relationships, ICI allows companies to greatly reduce risks associated with missed contract obligations. The platform also ensures commercial compliance by connecting contract data—like terms and prices—to operational systems like procurement, enterprise resource planning (ERP), and customer relationship management (CRM). The platform also enables tracking of spending against the contract and easy auditability for compliance reporting and Statement of Work (SOW) preparation.
As the only contract management system tailored specifically for technology companies, the ICI for Technology industry vertical solution has helped leaders such as Microsoft, Pluralsight, and ServiceNow transform their contracts into a strategic advantage. Drawing from best practices developed from Icertis’ deep industry experience, ICI for Technology specifically addresses the challenges and needs of the technology sector by delivering quicker deployment and time-to-value.
ICI for Technology is tailored to technology vendors, providing features such as: distributor and reseller risk assessment; SaaS and subscription model support; automated settlements around rebates and promotions; ready-to-use contract assembly and pre-built smart links for visibility; and more.
Because associations, rules, and workflows are tailored to the technology industry, your company accelerates time-to-value by closing deals and onboarding customers and partners more quickly.
Technology is a contract-intensive industry, and the complexity of contracts continuously grows. Leaving contracts to manual processes means exposing your company to too much risk, be it missed contract obligations, regulatory noncompliance, or operational errors such as performing work outside the scope of a contract that may be non-billable.
With Icertis Contract Intelligence, you can significantly reduce your risk exposure while improvinggovernance and compliance. For more insight into how advanced contract lifecycle management can benefit your business, download a copy of our free industry overview eBook, Contract Intelligence for Technology, below.
Contract Intelligence for Technology
Ready to learn more about how contract intelligence can help your company stay out in front? Download our industry eBook to view case studies, insights, and the three most common commercial challenges rooted in contracts.