"Organisations which don't manage their contracts
effectively will be at a tremendous competitive
disadvantage"
Tim Cummins, Director,
International Association for Contracts and Commercial
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Contracts underpin your organisations ability to be
successful. They define and underpin every commercial
relationship. They determine the terms, pricing and
service levels of employees, customers, partners and
supplier relationships. Get your business contracts
right and you have a sound platform for profitable
growth. Get them wrong or manage them badly and your
organisation is risking not just its relationships, but
it future.
In recent years, new business models and market
pressures have dramatically increased the volume and
complexity of contracts. At the same time, new financial
and compliance requirements have increased the urgency
for organisations to access, monitor and control
contract creation and performance.
A survey by Aberdeen Group of more than 300
organisations found most struggle with the following
contract management challenges:
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- Fragmented contract management procedures – a
lack of formal procedures for creating and managing
contracts
- Labour-intensive processes – contract
negotiation, authoring and management activities are
executed in a series of disparate and largely manual
activities
- Poor visibility into contracts – contracts are
stored in a paper format limiting the ability to
locate, let alone monitor and manage compliance,
asses revenues and analyse performance
- Ineffective monitoring and management of
contract compliance – due to the lack of visibility
into contract terms and the inability to collect and
analyse key meta data. In addition the lack of
defined ownership for contract administration and
compliance
- Inadequate analysis of contract performance –
the lack of effective contract visibility or
compliance tracking procedures
Impact of Poor Contract Management
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