It’s no secret that technological advancements in reporting analytics and business intelligence have revolutionized how C-level executives approach all business processes. Contract lifecycle management (CLM) is no exception in the digital era. And good contract management software takes CLM in a new direction by using cutting-edge automation features to digitize the process from start to end and boost productivity at every turn. However, contract intelligence can do even more. Since CLM affects nearly every aspect of business operations, using your contract management software to glean actionable insights and implement them is crucial for long-term success.
Here are five business intelligence tips to help you run your corporation contracts efficiently.
1. Determine the right KPIs for your business.
If you wish to leverage contract management for long-term success, it’s imperative to stay vigilant in monitoring the performance of your contracts. It’s not that simple, though. When you have several ongoing contracts, each with varying conditions, it can be hard to quantify the efficiency and effectiveness of every single one of them. Fortunately, four key performance indicators (KPIs) can help you determine the success of an agreement, regardless of its complexity. They are:
Cost: It may be necessary to reevaluate a contract if it incurs unanticipated costs without generating a satisfactory return on investment.
Timeliness: The performance of a contract may suffer if the other party is chronically late in delivering on their commitments.
Reliability: To keep your business running well, you must have a strong and effective working relationship with your contracting partners and suppliers.
Quality: Prioritizing quantity over quality often results in subpar work. High-quality completed contracts are essential to retaining existing clients and on boarding new ones.
2. Use a good ERP data warehouse.
Data warehousing is integral for the success of any enterprise. Every BI strategy needs a centralized data source to deliver desired results. Almost all businesses have a system to collect and analyze information. Yet, they must ensure they include all the necessary data aspects for a BI Strategy.
For starters, you need a clearer idea of the information and infrastructure you’re looking for. There’s a large number of enterprise resource planning (ERP) and line-of-business (LOB) tools for you to choose from. But if you don’t want to take that route, don’t worry. Thankfully, many software vendors nowadays offer generic data warehouse models that can be tailored to an organization’s specific needs and incorporate data from any app in use.
3. Capture the right BI data.
BI and analytics tools offer different functionalities and use cases. Therefore, it would be best to do your due diligence and compare the features of available options to your company’s data analytics and reporting needs. When integrated with contract management software, the ideal BI tool should be able to provide valuable insight into essential contract data such as:
client and vendor information
contract start and end dates
You might want to capture the information you may require for a need-gap analysis (more on that below) that helps identify gaps and inefficiencies in your contract workflow. With the proper data, business strategists can ensure efficient data analysis and improved business decisions.
4. Conduct a need-gap analysis.
As a business owner, you can benefit significantly from conducting a need-gap analysis to check whether your business is achieving business objectives or not. And what steps you should take to meet them.
Ideally, a contract management solution should be able to tell you how long each step in the approval and signing processes takes on average and list all contracts that are currently in progress. A need-gap analysis will help you shorten the duration of the contract lifecycle by highlighting the problem areas so you can act proactively to eliminate them. Having the data to indicate team communication gaps and bottlenecks is sometimes all we need to get things back on track.
5. Develop a plan for data governance.
Business decisions based on accurate and relevant information seldom fail. To guarantee the success of your business intelligence strategy, you need a good plan for data governance. That way, you can rest easy knowing that your data is reliable, actionable, and consistent throughout your organization. In addition, a data governance policy will help guarantee that only authorized users can access your data. Lastly, having a solid data governance plan in place will help you avoid trouble with the law if you ever run into problems with data privacy.
From identifying trends, risks, and opportunities for business growth to staying top of mind with clients and prospects, contract intelligence—if done correctly— can propel a business to the forefront of its industry. Hopefully, using the above tips, you can create a powerful BI strategy that will give you a leg up on the competition.
Qurat-ul-Ain Ghazali, aka Annie, is the growth manager at Contract book and looks after all the organic channels. She has been with tech startups and scale ups for a couple of years with a B2B focus. You can find her socializing, traveling, indulging in extreme sports, and enjoying the local desserts when she is not working.