When it comes to contracts, finance teams are faced with a wide range of concerns - pricing adjustments, timely payments, and keeping the business financially viable. But it's difficult to manage all these goals without implementing an automated software to maintain records, send out reminders and reports. A Contract Lifecycle Management (CLM) software can help finance teams manage these responsibilities with an efficiency that manual record keeping cannot achieve.
A CLM software manages the lifecycle of a legal document or contract – from creation to execution. It can create a centralised database for all invoices, order forms, deeds and other financial documentation, and generate detailed reports to inform future decision making by the finance team. Here are some of the ways that finance teams can achieve their goals with a CLM.
Better access to information
A CLM creates a centrally accessible online database of all financially relevant documents. Instead of a document having to physically travel through multiple channels, anyone with the required access can easily find the information from anywhere in the world and take action accordingly. This access creates transparency,increases operational efficiency, and allows finance teams to establish more fruitful relationships with external parties.
A huge part of the finance department’s work relies on strict adherence to timelines for payment and performance. Manually keeping track of all obligations can be extremely daunting, and is one of the areas where a CLM tool really shines. A CLM can create alerts for upcoming signatures, renewals, revisions and obligations. This ensures that the finance teams always stay on top of their responsibilities without missing any deadlines and avoiding any penalties.
Increase security and reduce operational risk
When financial documents are maintained physically, there is a risk around the security of the customers’ and the business’ sensitive data. A CLM can prevent these risks by safeguarding against unauthorized internal access and external data breaches by deploying encryption, anti-virus measures, malware protection, etc.
A CLM tool allows different teams across the organisation to collaborate seamlessly while drafting or negotiating contracts. In addition, using automation in contract management facilitates quick searches and retrievals, along with offering clear organisation of the plethora of documents concerning the institution.
Informed financial decisions
CLM tools can easily generate reports from the data contained across a variety of documents. This allows finance teams to inform their decision making with data-based facts and logic, and helps them improve the quality of their financial decisions.