Customer contract management is not a CRM task; it is a CFO and Director level responsibility, because the risk of poor governance of contractual commitments has far reaching and serious consequences. Death and personal injury in contracting carries personal risk for those involved in managing the contract, and poor contract management has a direct impact on reduced revenues, profit margins, and the likelihood of litigation occurring.
Software for contract lifecycle management helps us get control of our organisational commitments by automating contract management processes, providing a central repository of agreements and pre-emptive reminders of deliverables and contract triggers. This manages the risk of non-compliance.
Quite probably you are not the person who negotiates and drafts the contracts in your organisation, but you manage customer accounts. If this is the case, then there may be important clauses in customer agreements that you need to know about, but don't. One such clause is a possible right to raise the value of a contract by CPI every 12 months. There will be a limited opportunity before a contract rolls over into a new period where you are required to give notice that you are increasing the value of the contract, and if you miss the cut-off date, then you miss the revenue. There are many other possible reasons for cost increases that you may need to pass on, and these all have notification deadlines.
Being in compliance with your customer agreements is business critical. The contract is a firm commitment. Are you delivering what you have committed?. If you don't have a software system that monitors deliverables and milestones, then you may not be in compliance with your customer agreements, and you will not know until your customer tells you so. Delays and non-delivery can mean it takes longer to get paid, or you don't get paid at all, and your customers will choose to go elsewhere.
Delays in some large contracts can make you liable to pay liquidated damages to your customer as a penalty for late delivery. Late or non-delivery can also lead to termination of an agreement, and possible litigation, costing your organisation millions in lost revenue and damages.
Contract lifecycle management software helps mitigate the risk of non-compliance in your customer agreements by automating your contract management processes for everyday tasks. Contract lifecycle management can make these processes available to your whole organisation providing corporate consistency, accountability, and auditability.
The biggest risk is not knowing what your risks are. If you do not know what is in your contracts, then it may be time to have a look. How long does it take you to find a document and associated contract files? - 16039
Software for contract lifecycle management helps us get control of our organisational commitments by automating contract management processes, providing a central repository of agreements and pre-emptive reminders of deliverables and contract triggers. This manages the risk of non-compliance.
Quite probably you are not the person who negotiates and drafts the contracts in your organisation, but you manage customer accounts. If this is the case, then there may be important clauses in customer agreements that you need to know about, but don't. One such clause is a possible right to raise the value of a contract by CPI every 12 months. There will be a limited opportunity before a contract rolls over into a new period where you are required to give notice that you are increasing the value of the contract, and if you miss the cut-off date, then you miss the revenue. There are many other possible reasons for cost increases that you may need to pass on, and these all have notification deadlines.
Being in compliance with your customer agreements is business critical. The contract is a firm commitment. Are you delivering what you have committed?. If you don't have a software system that monitors deliverables and milestones, then you may not be in compliance with your customer agreements, and you will not know until your customer tells you so. Delays and non-delivery can mean it takes longer to get paid, or you don't get paid at all, and your customers will choose to go elsewhere.
Delays in some large contracts can make you liable to pay liquidated damages to your customer as a penalty for late delivery. Late or non-delivery can also lead to termination of an agreement, and possible litigation, costing your organisation millions in lost revenue and damages.
Contract lifecycle management software helps mitigate the risk of non-compliance in your customer agreements by automating your contract management processes for everyday tasks. Contract lifecycle management can make these processes available to your whole organisation providing corporate consistency, accountability, and auditability.
The biggest risk is not knowing what your risks are. If you do not know what is in your contracts, then it may be time to have a look. How long does it take you to find a document and associated contract files? - 16039
About the Author:
Adam McInnes is the CEO of Open Windows Contracts, an innovator in contract lifecycle management software. Open Windows offers a trial of their contract management software and further information that you may be interested in.
