Why do companies continue to waste time and resources within contract management?
The General Counsel’s technology report found that 65% of legal professionals identified the more irritating part of work is time lost on administrative tasks. Sounds logical, right? But what we don’t think of is the constant administrative work that is done every single day not only takes away from valuable tasks, leading to frustration and less time/effort spent on the more important tasks, but also leads to a level of insanity. As Albert Einstein explains, “Insanity is doing the same thing over and over again and expecting different results.” The frustrating, routine task of going through contracts looking for and deciphering certain clauses can take hours. The simple idea of looking for terms in a contract over and over is a mind numbing task, hence the insanity. Of course, the tangible effect of this can be measured in poor processes, disparate information and low levels of employee retention.
So it’s a win-win. Take away the boring administrative tasks from employees and save money. According to a study done by Accenture, using a contract management system could reduce legal costs by 70% by updating clauses faster, retrieving clauses quicker and extracting or entering key data. With the money saved, companies can pursue new opportunities for growth, new investments, and deploy personnel on higher value tasks.
An “Easy” Fix
So your company decides to address these problems and in the process save time and money. What now? How simple is it to actually automate contract management?
Well clearly not easy enough, according to the general counsel’s tech report.
Contract management is the difference between amount of money and time saved and the amount that is wasted on analyzing contracts. Within that difference includes streamlining the process of looking for certain terms and clauses. By creating efficiency here, the amount of labor costs saved and time cut down can be used to create value elsewhere within a company. Adopting contract management practices, however, includes a commitment to change. Contract management is evolving to become a strategy for a company rather than just an application running on your computer. The norm of filing away contracts and leaving them to collect dust must be changed since these contracts contain more useful information after the fact, but cannot be found without automation. These opportunities trapped away in the filing cabinet limit the amount of insight and opportunity that can come from proper managing and analyzing of these contracts for future negotiations and contracts.
Take the Step Forward
Here at Counselytics, we feel that companies should not continue to waste time and resources within contract management. Perhaps the biggest hurdle to automating contract management is to move the existing data within legacy and 3rd party contracts within the database. This is a particularly cumbersome and expensive undertaking given the manual effort involved. However, with the recent development of artificial technologies such as Counselytics, this step is now automated. Counselytics is able to read through the existing contracts, extract and structure key data points within seconds. This provides a baseline for future contracts and eliminates the costs associated with manual intervention.
Let automation and Counselytics help cure the insanity from these administrative tasks!