What is CLM (Contract Lifecycle Management)? Definition
What is CLM (Contract Lifecycle Management)? It’s a system for automating, organizing, and storing contract-related information. CLM software can help streamline the contracting process, improve accuracy and compliance, and save time and money. While the term “contract lifecycle management” may sound like it only applies to big businesses, the truth is that any business that deals with contracts can benefit from CLM software. In this article, we will explore what CLM is, how it can help your business, and some of the best CLM software on the market.
What is CLM?
CLM is a software that helps companies manage contracts throughout their lifecycle. It includes features such as creating and storing contracts, tracking changes and amendments, negotiating terms, and more.
The benefits of using CLM software include improved visibility into the contract management process, reduced risk of errors and omissions, and increased efficiency in managing contracts.
The need for CLM
Contract lifecycle management (CLM) is the process of managing contracts from their inception to their expiration and renewal. The goal of CLM is to optimize the contract management process so that it is more efficient and effective, resulting in improved organizational performance.
There are many benefits to implementing a CLM system, including:
1. Increased visibility into the contract management process: A CLM system provides a centralized repository for all contracts, making it easy to track and manage them. This increase in visibility can help identify bottlenecks and inefficiencies in the contract management process, so they can be addressed.
2. Improved communication and collaboration among parties: A CLM system can help improve communication and collaboration among the various parties involved in a contract, by providing a shared platform for discussion and information sharing. This can lead to better decision-making and faster resolution of issues.
3. Enhanced contract governance: A CLM system can help organizations implement best practices for contract governance, such as setting up approvals workflow, defining roles and responsibilities, and establishing processes for monitoring compliance with contracts. This can reduce the risk of non-compliance issues and improve the overall efficacy of the organization’s contract management function.
4. Reduced costs: By streamlining the contract management process and reducing duplication of effort, a CLM system can help organizations save time and money.
How CLM can help
CLM can help manage the entire contract lifecycle, from creating and negotiating contracts to renewing or modifying them. It can also help automate various tasks associated with contracts, such as creating and sending reminders for contract expiration or payments. Additionally, CLM can help track important dates and milestones associated with a contract, such as project deadlines or product delivery dates.
What to look for in a CLM software
When you’re considering a CLM software, there are a few key features to look for. The software should be able to track and manage all aspects of the contract lifecycle, from negotiation and drafting through execution and renewal. It should also provide a central repository for all contract-related documents, so they’re easy to find and access. Additionally, the software should offer robust reporting capabilities, so you can track your contracts’ performance and compliance over time. And finally, it should be user-friendly, so your team can quickly learn how to use it and put it into action.
Conclusion
CLM is an important part of business management, and it’s critical to understand what it is and how it works. By definition, CLM is the process of managing contracts throughout their entire lifecycle, from initiation to execution to close-out. This includes everything from negotiating terms and conditions to tracking performance to ensuring compliance. A well-managed CLM process can save businesses time and money, improve efficiency, and reduce risk. If your business doesn’t have a contract lifecycle management process in place, now might be the time to consider implementing one.