The process of managing company contracts can be lengthy, tedious, and sometimes even unproductive. Because contract management is so integral to the performance of essential business tasks, implementing the use of tools that can streamline and simplify the process is crucial.
Electronic signatures are increasingly being used as a tool to enhance contract management and better the process for employees, clients, and vendors alike. Below, we’ll take a closer look at how electronic signatures can keep the flow of contracts steady and increase efficiency.
What Is Contract Management?
From start to finish, contract management is a process used by individuals and businesses in all different industries to obtain completed legally binding agreements.
Because contracts can essentially dictate when, how, and in what manner businesses, employees, and clients interact with one another, how the process is managed and completed is crucial. Not only is it vital to have contracts completed correctly, but it’s also important to have them completed quickly.
Contract Management from A-Z
Many business workflows have become digitized (or are heading that way), not excluding paperwork and contracts. While completing digital contracts is a significant step in the overall workflow for many companies, the individual workflow to complete the contracts themselves is imperative – this is where the 7 contract management steps come in.
1. Preparation
During the preparation stage, needs, risks, expectations, and goals should be clearly outlined. Things change in business and in life; therefore, contracts should be designed to outline expectations and adequately protect businesses and signers in all applicable scenarios.
2. Creation
Following planning and preparation, the contract will need to be drafted. Contract drafting can be a tedious process to ensure the correct terminology is used and nothing is left out. Many businesses opt to consult with legal counsel during this process.
3. Approval
The contract approval step generally includes management or upper level approval. Having a second set of eyes review a contract before it’s provided to a client or another party can be helpful to ensure accuracy.
4. Negotiation
Oftentimes, the initial contract presented won’t be the last. Once presented to the signing party, there may be requested changes or negotiations while both parties work towards a compromise. During this stage, contract managers will need to be prepared to edit and revise a contract as needed.
5. Signing
The signing step can be the easiest part of the contract management process, but only if the right tools are involved. Electronic signature software makes signing contracts in legally binding form a snap for all parties, no matter where they are.
6. Revision
Generally speaking, contracts will require revision at some point or another. If something changes with the signing party or amendments are approved, contract managers will need to be prepared to handle accordingly.
7. Management
Managing a contract during its lifespan is key; contracts expire, require revisions, need renewing, and sometimes require auditing or need to be supplied for legal proceedings. For these reasons, careful organization, storage, and management of signed contracts is imperative.
How Electronic Signatures Can Optimize Contract Management
So, how do electronic signatures fit into this steady contract management flow? As it turns out, utilizing eSignatures has become an important tool for contract managers in their attempts to optimize this important workflow. Here’s how:
Faster Signing
With electronic signature software, contracts can be prepared in no time and sent and signed in a matter of seconds – not days or weeks. With user-friendly software, such as Foxit eSign, contract managers have the opportunity to close sales and get approvals faster through the ability to send contracts directly to signers anywhere in the world. Signers can then approve, sign, and return contracts in a matter of minutes.
Error Reduction
Correcting and preventing errors is a breeze with electronic signature usage in contract management. Features like mandatory signing fields help prevent missing information, and the capability of correcting and resending a contract within minutes helps prevent costly and time-consuming mistakes.
Dynamic Auditing
Auditing is a large portion of contract management. With dynamic auditing features and reports, like those with Foxit eSign, contract managers can easily see where a contract is and at what stage of completion it’s in at all times. This can be especially important when waiting on a contract to be signed by multiple parties; managers can quickly see what the contract is dependent on for completion and send reminders to applicable parties.
Enhanced Security
It’s no secret that traditional pen-and-ink contracts can easily get lost, misplaced, stolen, duplicated, or forged. By implementing digital contracts and electronic signatures, contract managers can maintain stricter enhanced control over the security of contracts from A-to-Z. Foxit eSign features tools, like digital signature features and two-factor authentication, that allows users to control document security in a way that works best for them while also working hard on the backend to protect documents with things like SOC 2 Type 2 compliance and 256-bit encryption.
Improved Workflow
It’s not just the signers that electronic signatures improve the contract process for, but businesses are finding increasingly that employees enjoy a simultaneously improved workflow. Oftentimes, multiple departments and coworkers may need to collaborate on a contract; with digital documents and electronic signatures, contracts can easily and securely be shared, revised, and approved in just minutes.
