what is contract management

What is Contract Management?

Contract Management is also known as Contract Administration. It is used to manage contracts that are made with partners or customers. This process can efficiently manage the creation, analysis and execution of contract. By this process, it maximizes performance and financial and minimizes the risk. Some of the contracts that are commercially common are sales invoice, employment letter, purchase order and useful contract.

What are contracts?

Contracts are legal covering of an agreement to satisfy all rules and regulations between the partners and customers. Some of the types of contracts are:

  • Sales Contract
  • Purchase Contract
  • Trade agreements
  • Partnership agreements and
  • Property agreements

Contract Management Areas:

Some of the areas of contract management are listed below:

  • Commitment Management
  • Baseline Management
  • Document Management
  • Contract awareness and visibility
  • Communication Management

Since there are many areas that cover contract management, the above mentioned areas are commonly used. These areas of contract management are highly employed in U.S.

Software for Contract Management:

Most of the contracts in many organizations are managed by olden manual method. But only 25 % of companies worldwide have installed software for contract management. This control management software helps to automate the process of contracting, such as creation and arranging of contracts through compliance, renewal and monitoring. These solutions develop the company’s control, access and visibility over the contracts. This software is also used to organize the life cycle of the contract. It also offers SLM i.e. Service Lifecycle Management. Better retention of customers is offered by this management. The advantages of controlling management software are: it increases sales effectiveness and compliance.

The Contract Management helps to decrease the leakage of revenue, increases contract rates by compliance and also develops the performance of Contract Lifetime Management However, even more facilities can be gained by installing Contract Management Software in all companies.