To truly optimize your vendor contracts, you need to look at your contract management process from 2 important points of view: Contract Procurement and Contract Optimization.
Contract procurement begins with procedures followed by a business when purchasing services or products. The process starts when company managers identify a business need that must be fulfilled and ends when the contract is awarded and signed.
Contract optimization is the process of systematically and efficiently managing contract creation, execution, and analysis to maximize operational and financial performance and minimize risk. Unfortunately, many businesses lack the processes or systems required to optimally manage customer or supplier contracts.
Real improvement to your bottom line requires a focus on both areas, and methodically looks at three important parts of the system: processes, workflows, and technology. Together, these elements create a system that enables your vendor management team to standardize your approach, and organize contract management tasks. It enables teams to use centrally-located contracts, templates, and standardized clauses efficiently. An optimized contract management system improves coordination, collaboration, and communication among team members.
Processes and Workflows
What’s the difference between a process and a workflow? How do they work together?
- A process lays out a group of activities or tasks to be performed to accomplish an objective. It typically includes a defined start and completion.
- Workflows, however, describe the movement of these tasks throughout the entire process. They look at how the tasks are structured, related, ordered, synchronized, and tracked, and who is responsible for completion of them.
The more comprehensive the process and the more streamlined the workflow, the better they work together to create an effective contract management system.
Automation and Technology Improves Efficiency
Streamlined workflows create efficiency. However, using document management technology to automate that workflow improves efficiency across your organization, and throughout your contract lifecycle. Creating a functional digital workflow with escalations and notifications from a document management system enables an organization to:
- Automate administrative and other simple tasks, allowing team members to perform strategic activities,
- Speed the content creation and approval processes,
- Synchronize data between departments to increase visibility across the contract lifecycle, and
- Proactively track and manage performance requirements and facilitate service levels with speed and precision.
Designing a contract management process that includes a document management system is the key to optimizing contract procurement (starting from scratch) and contract optimization (done periodically throughout the contract). This systemic approach to managing vendor contracts will streamline the entire process, improve efficiency, and provide improvement to your bottom line.
About Limitless Technology
Limitless Technology, LLC has been managing complex indirect spend and vendor documentation since 2006 for some of the largest companies in the USA saving them millions in costs.
Through our Billing Optimization and Vendor Management Solutions proprietary platforms we utilize technology, processes, expertise, time, and resources to improve our client’s bottom-line.
Limitless Technology manages your vendors, so you can manage and grow your business.
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