Once considered a tool for legal teams, Contract Lifecycle Management (CLM) is now gaining traction among procurement professionals. A shift in perception has been observed over the past decade, with companies recognizing the benefits and convenience of CLM. Particularly, businesses subject to heavy audits are increasingly leveraging this system. According to a survey by Agiloft, 80% of procurement professionals without a CLM system are considering its adoption, with nearly half planning to do so within the next year.
Key Features Desired in CLM Systems
Procurement professionals are particularly interested in certain CLM features. These include the ability to monitor contract flow, changes, and renewals, ensuring purchasing adheres to established guidelines, and having access to a clause library for efficient contract creation. However, these essential features are often missing in existing CLM systems, with 56% of users reporting their absence.
The Advantages of Efficient Contracting
Efficient contracting can accelerate various aspects of a business, including compliance and savings. While legal teams often spearhead the purchase of CLM systems, procurement professionals frequently use these systems. When procurement leads the purchasing process, they often share valuable contract data with other departments, enhancing decision-making and strategy across the company.
The Role of AI in CLM
Artificial Intelligence (AI) holds significant potential for revolutionizing contract management. It can simplify tasks such as locating specific contracts among numerous documents or updating multiple contracts simultaneously. However, despite the potential benefits, many procurement professionals remain hesitant about AI. Some report that it’s not an available option, while others express a lack of interest even when it is accessible.
Conclusion
Regardless of the department, the value of CLM is becoming increasingly apparent across organizations. The key lies in selecting a system that meets the needs of all users and facilitates the sharing of contract data throughout the enterprise. Integrating this wealth of data with other departmental systems can significantly enhance organizational data management. Ultimately, CLM is not just about managing contracts; it’s about elevating business success.
