When you hear the word ‘contracts', what do you think of? Closing deals? Generating revenue? Committing to obligations? Managing risk? Contracts are involved in nearly every aspect of operating a global business, and can nurture or degrade critical supplier relationships.
Supplier relationships require clear communication and trust – but they still need to be monitored and measured. A contract management system can be a big help in this regard.
Coming to an Understanding
One of the primary goals of the contracting process is for each party to share a common understanding regarding their obligations and commitments. This means you need access to detailed information about your suppliers' products, services and performance history. With a centralized repository for supplier information, an enterprise contract management system allows you to see all the agreements for a supplier, including third-party paper, and understand the inter-dependencies between them. This helps to reduce errors and ensure an alignment of terms.
The Icertis Contract Management (ICM) platform stores a comprehensive library of templates, clauses and approved languages. Third-party paper can be imported, so key terms and obligations can be compared to your organization’s approved contract language. This enhances the ability to come to an agreement on essential contract terms while ensuring compliance with industry, legal, and internal standards.
With this information, procurement teams can engage with suppliers more effectively, developing common objectives, and establishing key performance indicators and milestones. Tracking the fulfillment of obligations builds trust.
Signing a contract isn’t the end of the contract’s lifecycle, nor is it the end of a relationship with a supplier. The ICM platform automatically integrates and tracks the KPIs, contract terms, and benchmarks established with the supplier during the negotiation phase of the contract. It generates alerts and pushes notifications to complete tasks, reducing the likelihood of missing milestones, increasing your organization’s ability to capitalize on opportunities.
Mobile capabilities ensure that all team members have access to the most current data at any time, on any device. This real-time visibility allows stakeholders to determine the status of the contract at a moment's notice.
Many organizations still employ a hybrid of manual contracting processes, supported by document management systems or contract repositories.
In this use case, communication is accomplished manually via email, which can easily be lost or overlooked, leading to errors or missing information. The ICM platform eliminates these issues by automatically generating requests for information, quotes, and proposals, or triggering notifications through configurable workflows.
A secure online portal is another key to maintaining clear communication throughout the relationship. Both sourcing professionals and suppliers can get online access to review their contracts, submit redlines or upload compliance documents. Emails and attachments can easily be uploaded and integrated into the system for centralized access.
To learn about how an enterprise contract management system can help your business to better manage supplier relationships, download this whitepaper: