Each step of the contracting process needs careful attention and patience to make sure each clause is to your liking. Negotiating the contract can be tedious and exhausting, typically resulting in numerous drafting rounds as lawyers argue until everyone is happy with the contractual language used.
However, once you’ve signed the deal, there’s another matter you’ll have to worry about: administering the contract and ensuring that everyone complies with it. This aspect can be especially tricky if you aren’t careful, but you’ll stay on top of everything without breaking a sweat with the right contract lifecycle management software. Here are five best practices that will improve your contract compliance:
Set Measurable Goals
When contracts aren’t correctly managed, the more likely they won’t be renewed. If contracts play a massive role in your company’s operations, this can hamper your efforts to grow your business. Many entrepreneurs make the mistake of approaching contracts as mere formalities but managing them can leave a tremendous effect on your business’s bottom line.
To manage your contracts correctly, you’ll need to outline each contract’s goals. It is crucial to determine the purpose and value of each agreement to establish metrics, which will tell you how close you are to meeting your goals and objectives.
To ensure that both parties fulfill their contractual obligations, you’ll need to implement a comprehensive contract management system. Contracts typically have precise deadlines and schedules that everyone must abide by, and following these dates is a vital part of compliance. You’ll have to keep your contracts safe this way, which is possible through a contract management system, which helps you coherently organize these documents. It’s essential to do this right away since managing your portfolio will become more challenging once it grows, making it more tedious to attend to old organizational matters.
Part of ensuring contract compliance is clarifying the roles and responsibilities of the personnel involved. Doing so will avoid expensive redundancies or oversights that could upend the arrangement. Compliance issues occur when expectations haven’t been laid out, when there are lapses in communication, or when work was haphazardly delegated. By determining each professional’s role in the contract, you’ll have an easier time improving your contract compliance.
Make the Process Consistent
Businesses handle numerous contracts. To make it easier, you’ll need to make the contract management process more consistent. It may seem difficult to do this with dissimilar contracts, but contract lifecycle management software can make this easier. With the right solution, you can leave the monotonous aspects of contract management to technology, paving a seamless path to compliance.
Stay Informed of Any Changes
Complying with your contracts means staying updated on all the rules and regulations on the local, state, or even federal level. These laws can change at any time, and you may not catch these announcements while you’re busy managing your business. Be sure to stay abreast of the latest legal requirements, which you can do by hiring counsel or another kind of legal expert that will immediately apprise you of critical changes.
Many companies struggle with contract compliance due to the lack of the right approach and technology. By integrating these best practices into your contract management, you’ll become a master at fulfilling your legal obligations.
Anapact is easy-to-use contract lifecycle management software for small and mid-sized businesses. With our solution, you can reduce risk, ensure compliance, and make the most of your contract documents. Get a demo today!