If you’ve ever worked on a sales team, you know the struggle of trying to keep up with contract workflow.
I’ve been there. I know the pain of dealing with multiple versions of contracts, dead-end processes, and delays in closing deals.
But don’t worry – contract workflow doesn’t have to be such a headache! With the information and strategies outlined in this article, you can learn how to quickly and easily close more deals.
What is Contract Workflow?
Contract workflow is the process of managing the entire lifecycle of a contract from start to finish.
Managing your contract workflow is essential for ensuring that deals are closed in a timely and efficient manner.
This includes the following:
- Creating and sending contracts
- Negotiating and approving revisions
- Signing documents electronically
- Tracking their status
- Archiving the final signed versions for future reference
It is an automated system designed to make sure that all parties involved in a contract have access to the latest information and can move quickly to close deals.
Using helpful software lets you sign and create contracts quickly, efficiently, and easily.
Having arranged an appropriate contract workflow, you will spend less time generating contracts and more time on customer service.
Contract Workflow Stages
If you have been involved in contracting before, you probably know how extensive this process is.
Understanding how to optimize this process is essential, so you must familiarize yourself with each step to improve the contract.
Let’s take a closer look at each of the following stages:
- Contract drafting
- Contract signing
- Audits and updates
The first step of contract workflow is often the most important since it sets the stage for successful negotiation and execution.
Preparation is essential for any agreement, and numerous steps must be taken to ensure that both parties thoroughly understand the contractual matter.
This includes researching all relevant information to become familiar with the subject matter, such as the following:
- Laws and regulations
- Industry trends
- Documents associated with the contract
By doing so, you are in a better position to understand the situation and be able to make wise decisions when drafting the agreement.
Additionally, preparing a checklist of questions to ask on critical aspects of an agreement can help formulate better deal points when negotiating.
Furthermore, reviewing contracts from previous negotiations can be advantageous when drafting this one to ensure common issues are addressed ahead of time.
Contract drafting is the next step in contract workflow. It involves creating a document that contains the agreed-upon terms and conditions of two or more parties entering into an agreement.
The draft should be written in clear and concise language that both sides can easily understand so that when it is finalized, there will be no ambiguity regarding what was agreed upon.
During this step, the drafter must consider all relevant legal considerations, such as the following:
- Governing law
- Dispute resolution mechanisms
Furthermore, industry-specific considerations may include licenses, warranties, indemnification clauses, confidentiality agreements, or non-compete clauses, depending on the nature of the transaction.
The drafter must also ensure that all parties involved can recognize their respective rights and obligations under the contract and any potential risks associated with entering it.
This means they must consider the financial implications and potential liabilities related to a breach of contract or violation of regulations applicable to the particular agreement.
You can find contract templates in the PandaDoc template library. All you need to do is customize it according to your needs and decide whether or not you want a signer to use a digital signature.
The approval step in a contract workflow is an essential one. It represents the point in the process when all parties involved have had an opportunity to review the document and ensure that it meets their needs and expectations.
During this stage, both parties must agree on the terms of the contract before it can move forward. The approval process can involve various people and departments depending on the complexity of the agreement and its associated business interests.
When seeking approval, both parties must ensure that they are adequately informed about each aspect of the agreement. They should understand its contents and how it will affect their day-to-day operations and future goals.
This is particularly important when dealing with large contracts which may have significant financial or legal implications for both sides. In such cases, companies typically assign a team of specialists to carefully review every detail before approving.
The negotiation stage of a contract workflow is an essential part of the process. First, it involves identifying and analyzing the needs and expectations of each party involved in the contract before reaching an agreement.
This requires a thorough analysis of each party’s:
- Ultimate goals
To ensure a successful outcome for all parties, it is crucial to create a comprehensive document that details all aspects of the agreement and sets out each party’s responsibilities.
The negotiation stage also involves obtaining mutual consent from both parties regarding the following:
- Essential elements within the contract
The aim is to create an effective collaboration between two parties while ensuring everyone understands their roles and responsibilities.
In many cases, however, negotiations can become highly complex due to different perspectives on specific issues or disagreements over certain terms within a proposed agreement.
As such, it is often necessary to explore compromise options or ask for clarifications to reach an acceptable outcome for all involved parties. Here are some steps to help with your contract negotiation.
Everything should be straightforward at this stage. The contract is reviewed by all parties involved, and negotiations end at this stage.
It is essential that all parties are happy with the terms of the agreement. It is important to note that the signing process can sometimes be problematic.
Sometimes, even after a contract is finalized, certain changes and amendments may occur.
Such actions may be due to a change in the relationship between the parties or the need to amend the original contract.
No matter the reason, every amendment must be tracked so that everything can be legally verified. That’s why it’s best to use a digital version of the documents.
Audits and Updates
The second step in the contract workflow process is audits and updates. This is important to ensure all contracts are updated with current regulations, policies, and business needs.
Audits and updates help ensure that contractual relationships are well-documented, accurate, and risk-free. During this step, a full review of all contracts is conducted to identify any areas that need to be updated or amended.
All relevant parties must agree on any changes before they can be implemented into the contract. This ensures that all parties have the same understanding of their responsibilities and obligations under the agreement.
When performing an audit and update for a contract, it is important to look for discrepancies between written documents and actual practice.
It is also important to ensure that all clauses contained within the contract are up-to-date and legally compliant. In addition, auditors should ensure that no new material has been added beyond what was originally agreed upon by both parties.
If there is a discrepancy between reality and what appears in writing, then changes need to be made immediately to align them.
How to Improve Workflow
To ensure an appropriate contract workflow, you need to have a clear understanding of the entire process. Automation is one of the best options for this.
Setting up a proper training system is a great way to improve workflow in the workplace. It helps employees understand their job expectations and learn how to do them more efficiently.
The key to successful training is providing employees with the necessary skills and knowledge to do their job well.
This can include instruction on how to do the following:
- Prioritize tasks
- Use specific tools
- Communicate with colleagues and customers
Training also allows employees to reflect on their individual strengths, weaknesses, and needs to think critically about their performance.
Additionally, it keeps workers up-to-date on changes in the industry or new procedures that may affect their work.
Create Contract Templates
To speed up the workflow, you can use a contract template. This will help avoid a lot of mistakes, which are mostly due to human error.
When you have contract templates at your disposal, it will help you save time and find the right documents quickly without problems.
Contract templates enable you to speed up the management of their lifecycle. You’ll have more time and free up extra work for your legal team.
Ready-made templates are used for such purposes and also provide the opportunity to complete the work quickly and with appropriate quality.
Use eSignature software
It’s essential to choose the right software for document signature. This way, you can easily track the changes and updates over time.
With eSignature software, employees can sign documents electronically in a few clicks with limited effort and cost. Plus, it ensures compliance with legal regulations, providing secure data storage.
Automating the renewal of contracts is essential. You can save time and resources by automating this process.
Automation helps to track when a contract is due for renewal, and it also allows you to send out reminders before the expiration date so that you can take action on time.
Use a Contract Workflow Software
You can simplify the management process and facilitate it if you automate the contract workflow. To do this, you are recommended to use special software that helps to set up the contract workflow from contract creation through negotiation and execution.
Nowadays, it’s much easier to organize your contracts using workflow automation. This type of software will help you create and manage the contract workflow from creation to execution.
With the help of this software, you can be sure that your contracts are up-to-date, secure, and compliant with all applicable laws.
Contract workflow can be a significant challenge for any company. This is why you need to have a clear understanding of the process and choose the right digital solutions to automate it.
Once you with this, you’ll enjoy all the benefits of contract workflow automation: fast delivery, secure signature requests, regular audits and updates, templates for faster workflows, e-signatures, and automated renewals.