Why is efficient contracts management so important?
It is estimated that between 60 to 80% of all business transactions have a related contract or agreement, particularly in HR, Facilities and Procurement departments.
Contracts, however, are not just about setting out terms and conditions - when they are managed efficiently, they can help businesses to save money and reduce risk. The problem is, though, that few organisations realise this and do not rate the importance of contracts management highly enough.
Traditionally, supplier contracts are generated by individuals or departments with no standard company wide format. They are generally paper based and stored in multiple locations. It is also estimated that about 10% of all contracts go missing.
So why is it so important to manage contracts efficiently? Missed contract renewal dates can mean that opportunities are lost to re-negotiate for a better price and can cost a business dearly. The one sure way to ensure that this never happens and to avoid duplication of suppliers for the same services is to use an automated contracts management system.
A contract management system has an automatic renewal feature which alerts users to the fact that a contract is due for renewal. There is a template which is to be used by all concerned and set rules which must be followed. All current paper contracts can be scanned into the system at a scanning bureau and going forward all documentation is saved and stored electronically in the system.
For further information on contracts management software and systems please contact The IPC Group on 08081 45 46 47.