Digital transformation has quickly become the enterprise buzz word of the year – and for good reason. The pace of business is accelerating and organizations are facing pressure to increase their speed of operations while improving their ability to respond to changing market dynamics. In short, they face tough decisions which can result in either great success or existential decline.
Many digital transformation efforts at large companies have been in response to external pressure created by more digitally enabled customers or competitors. To date, those initiatives have typically been centered around enhancing customer engagements, but have not addressed foundational capabilities necessary to truly differentiate. This trend was recently corroborated by an Icertis survey of more than 500 executives at Global 2000 companies, which revealed that 67 percent of the respondents feel their digital transformation projects aren’t vaulting them ahead of their competition.
Executives are recognizing that digital transformation must be threaded through all aspects of the business beginning at the foundation of commercial relationships: the contract. For example, Daimler recently announced they have gone live with an enterprise contract management platform for 400,000 suppliers to ensure agility and flexibility across their passenger cars, commercial vehicles, and financial services divisions.
What Daimler realized is that contracts are foundational to commerce, governing every dollar that comes in and goes out of an enterprise. To provide visibility to all critical aspects of a contract, have a unified, all-up, view of all strategic contracts globally, and ensure transparency throughout the lifecycle of the contract, companies need to adopt at an enterprise-wide approach to contracting.
For too long, companies have managed contracts in separate repositories, with contracts sitting in silos – either by geography, business function or contract type. As a result, contracting at many organizations holds back performance – just when the increased speed of global business demands greater velocity and agility. New, enterprise-wide approaches to contract management can help increase contracting velocity and agility while at the same time reducing risk.
Contracts are foundational to commerce, governing every dollar that comes in and goes out of an enterprise.
For example, an intelligent contract management platform can proactively monitor contractual obligations and deviations helping identify, assess and automatically mitigate risk. Automated contract processes can increase contract velocity by as much as 80 percent, thereby significantly speeding time to revenue. In fact, 63 percent of companies with the right CLM software report faster and more profitable negotiations. And advances in technology such as machine learning and artificial intelligence mean that all of the company’s contracts can be deeply analyzed and turned into strategic assets.
Organizations that want to keep pace need to move past traditional, disparate contract lifecycle management solutions that only serve as a repository for contracts, and embrace a more comprehensive and intelligent enterprise-wide approach, leveraging the latest technologies. New, cloud based solutions enable a user-first approach that is faster to deploy, easier to use and achieve better adoption rates within the organization. Now is the time for companies looking for digital transformation initiatives that will truly impact their business to investigate an enterprise-wide contract management solution to help them maximize revenue, control cost and lower risk.