One of the crucial phases in the contract lifecycle management process is the intensive monitoring of the contractual documents. Enterprises deal with a range of contracts that differ in terms of importance, business nature, and priority. It takes a team of experts to effectively manage and monitor such contracts. When contracts aren’t monitored it might incur financial losses and legal repercussions. Therefore, it is essential for the organization to leverage an agile contract lifecycle management system software to prioritize and execute protocols in managing contracts. It is essential to monitor risks and create a roadmap to overcoming challenges. We have compiled a list of best practices in monitoring contracts that can make the job easier and more efficient for your organization.
Creation of Basic Monitoring Plans
Organizations often stumble to find the starting point. Where to begin is the basic question that hinders the entire monitoring process. This can be overcome effectively by using a robust contract management software with inbuilt monitoring features. Create a basic plan, where the priorities of contracts are duly assigned. The priorities usually vary with the industrial sector. While the manufacturing industries place importance on supplier contracts, the healthcare sector focuses on securing staff contracts. Based on the industry, the organization must create the basic parameters for monitoring, and segregate contracts extensively.
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The Management Team
The roles and obligations of the contract management team must be established for process clarity. Monitoring the contracts throughout its lifecycle is a comprehensive process that requires the expertise of specialists. The assigned monitoring specialist must be well-acquainted with the client/vendor/employee portfolio and ensure that the terms are complied with diligently. The assigned users must be given due access to the pertaining contracts and milestones stored in the enterprise contract management software. Entrusting the process with specialists will help the contract manager to streamline the contract management processes seamlessly.
The ultimate goal of monitoring contracts is to ensure compliance and avoid risks. Contract monitoring, unlike other processes, requires extensive participation and analysis by the management team. While the contract management software can render the performance of contracts over a period of time, the contract specialists must carefully analyse it to avert crisis and ensure contractual harmony. From monitoring the upcoming deadlines and important milestones to completing tasks on-time, the software enables the team to be abreast of the process.
Creation of Action Items
Most risks can be averted at the earliest stage when the information is escalated to the stakeholders duly. Effective monitoring of contracts includes creating of action items that require the intervention of key people. Creating a list of action items regularly based on the performance of contracts will help the stakeholders to make informed decisions during the annual review of contracts. It also enables them to evaluate their clients/vendors relationship, thereby measuring the opportunities for growth. Another benefit of creating action items is that it facilitates better negotiation for future contracts. The managers can change and improve the strategies while negotiating through analysing past data.
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In an age, where digitally-powered technologies are rampant, it is imperative to leverage the best solutions. Contract monitoring process has become an essential part of lifecycle contract management, where the decisions are formed based on the overall performance and relationship maturity. With a robust system to support, the contract monitoring process can be made effective and efficient. DocuCollab is one of the best contract management software that enables the contract team to monitor and manage volumes of contracts effortlessly. Choose DocuCollab to expedite and streamline contractual activities. Click here to know more about our product.