In all industries, it’s vital to have a solid contract management process in place. Contract management not only requires building a good working relationship with the customer, but also requires an ongoing monitoring and evaluating of the contract performance. Just because the contract is signed doesn’t mean the work is done.
Contract management is an important ongoing process. In order to be successful, you have to be attentive to the deal before and after the contract is signed. Below are some tips to help you be successful in your contract management process.
- Identify the Needs – Accurately assess the needs of the customer. Identifying the needs up front before the contract is written and signed. Knowing the needs of the customer will help you to provide a contract that is focused on what the client needs and how your solution will address those needs.
- Identify Aspects of the Contract – The contract is the foundation for the relationship between you and your customer. A good contract should include the following aspects: allocation of risk, quality of service required, value for money mechanisms, communication procedures, defined deliverables, etc…
- Monitor Contract Performance – Make sure to keep an eye on how the contract is performing. Measure deliverables and volume. Regularly reviewing contract performance will ensure both parties are meeting the agreed upon obligations.
- Manage Relationships – An open and good communication process is important for contract management success. Identify key contacts on each side so that if issues arise, everyone knows who should be made aware. Clear communication on a regular basis is key in order to have a good working relationship and keep the contract obligations in route.
- Choose the Right Tool – There are many contract management tools available; therefore, it’s important to choose the right one for your business. For example, if you’re a foodservice manufacturer, then you’re going to want to choose a tool that can handle a lot of contracts and data. You will need a contract management tool that allows you to set up multiple contracts for multiple distributors and operators and limits visibility based on the user. You will also want to ensure you will be able to monitor the contracts performance based on estimated volume vs actual volume. These are just a few things to consider. The type of industry you’re in and the type of contracts you write will play a big factor in choosing the right tool.
In order to maintain good contract management, it’s critical to understand that involvement happens before, during, and after the contract is signed. If you don’t have a process in place for managing your contracts, then there’s a greater possibility of your losing money. Businesses create contracts with the intention to increase profits. So, make sure you’re holding all parties accountable for upholding the agreed upon obligations. If you need help with your contract management process, contact GoSimple today to request a demo!