How to Master the Contract Approval Process in Contract Management
As a contract manager or in-house counsel, you may often find yourself stuck in the contract approval process. That’s because this stage of the contract management lifecycle is often more complicated than it needs to be — there are too many people and opinions involved and not enough transparency. Above all, the process itself can often be disorganized and confusing, particularly if you’re not using premier contract management software.
This is why you and your contract management team should streamline and master the contract approval process. By simplifying and improving the process, you’ll be able to stay on top of your work, organize your contracts better, and ensure that your contracts are meeting the right targets.
Read on to learn more about the contract approval process. By the end of this article, you’ll also learn how to streamline and improve the contract approval process with Ironclad Editor.
What is the contract approval process?
The contract approval process is the second stage of the contract management lifecycle. It happens after contract creation and contract negotiation and before contract execution.
The contract approval process involves reviewing contracts to see if all parties have reviewed them and which departments or stakeholders still need to approve them. It can be incredibly time-consuming because it’s often a disorganized mess involving many people and opinions. If you don’t have a centralized platform to make sure that everyone is on the same page, you may:
- Accidentally email your colleagues an older version of the contract
- Skip over typing a stakeholder’s email so they do not receive the contract at all
Your colleagues may also confuse the version of the contract from last week with the most recent version you just emailed. As a result, many of your colleagues may fall behind on the negotiation process, leading to miscommunication, delays, and even lawsuits.
That’s why you should use an advanced CLM like Ironclad to make sure all parties are up-to-date about what needs to be done before contract approval. By streamlining and improving the contract approval process, Ironclad’s powerful DOCX native collaborative platform and Workflow Designer will help you organize your contracts, create standardized contracts and templates, keep everything transparent, and more.
How to streamline the contract approval process
Organize your contracts
First of all, you need to realize that not every contract needs to be approved. In other words, not every contract needs to go through the same process.
But how do you determine which contracts need to be approved or not? If you’re working with hundreds or thousands of contracts, this can be a very daunting task, especially since you won’t have the time to read every contract.
This is where a feature like a Data Repository comes in. A searchable, centralized digital hub where you can place all of your contracts, our dynamic Data Repository makes the process of locating and organizing important contract metadata easier and faster than ever, zero training required. Say goodbye to trying to find contracts in your email, local storage, cloud storage, or even your cabinet. With Ironclad, you can bring in contracts from anywhere and use the Data Repository’s advanced search functions to locate contract information within seconds.
Our Data Repository also gives you the ability to put your contracts’ rich metadata to work. Ironclad automatically sorts your contract by metadata data, so you can organize your contracts into different groups (i.e., by storage guidelines, renewal date, naming conventions, etc.). This way, you will save a lot of time and energy that you can use for tasks that specifically require your legal expertise and knowledge.
Create standardized contracts and templates
Ironclad also allows you to save time by creating standardized contracts and templates. With Ironclad’s Workflow Designer, you can:
- Create and modify templates for all types of contracts, from HR to shipping and more
- Craft workflows without the need for manual review
A codeless tool with an intuitive drag-and-drop user interface, Ironclad’s Workflow Designer allows you to set up contract templates and standardized contracts with just a couple of clicks. All you have to do is set up a template, tag any fields that need to be provided, add signers and approvers, and approve it. After that, you can just automate the approval process.
Our reliable boilerplate clauses and legal language will also help you and your team to ensure 100% compliance with legal requirements and organization policies without manual review. That way, you won’t miss including key clauses, which often happens when you reuse existing clauses from older contracts instead of using templates.
Without templates, contract negotiation can take up a lot of your time because each party is negotiating to minimize legal, financial, and operational risk and get the best terms. Parties often stretch out the approval process, especially if there are delays in contract creation, review, and execution due to miscommunication and lack of coordination between the parties. Templates, however, already come with a lot of standardized clauses and terms, so the parties can spend more time on the actual substance of legal documents.
What’s more, Ironclad is powered by the world’s most powerful AI technology, Google Cloud AI. This means that you’ll be able to use our AI models to help you create standardized contracts and templates. As the only CMS to partner with Google Cloud AI, Ironclad offers powerful AI models that work straight out of the box, no training required. Use them on any contract you’re working on — they will automate all of the everyday contracting work for you and your team, giving you more energy to focus on demanding tasks such as negotiation.
Collaborate with colleagues so everyone is on the same page
We’ve already discussed the importance of negotiation in the contract approval process, but there is another aspect of contract management that’s equally important — collaboration.
Collaboration involves working with all stakeholders and parties to make sure everyone is on the same page. In other words, collaboration builds transparency into the contract approval process to ensure compliance and consistency, which in turn will make reviewing, negotiating, and approving contracts much less of a burden.
Ironclad’s DOCX native collaborative platform encourages collaboration by letting you:
- Edit and redline comments effectively and efficiently: Unlike traditional contract management platforms, Ironclad allows you to edit, accept and reject tracked changes, redline, and comment on DOCX files in real-time, eliminating the need for emailing copies of your contract to your colleagues.
- Keep in touch with your colleagues in real-time: Like Google Docs, Ironclad gives you the ability to loop in colleagues using internal comments and @mentions. This saves you the time and energy you would normally spend on attaching the newest version of the contract to an email and waiting for a response.
How to continue improving the contract approval process
Now that you know how to streamline the contract approval process with Ironclad, let’s take a look at how you can continue improving the process. Without constant improvement, your contract approval process may not be able to deliver the value you need.
This is where Ironclad’s powerful analytics software come in, giving you the power to keep your projects on schedule and ensure that you’re meeting your business goals. With our Data Repository’s Process Metrics Reporting tool, you can view, generate, and create reports of important metrics such as:
- How long it takes to approve the average contract
- How long it takes to complete a certain type of contract (e.g., an HR contract)
- How many contracts are waiting to be approved and for how long
Through Process Metrics Reporting, you and your team will be able to measure the success of your contracts. Without these metrics, you won’t be able to quantify how far behind or ahead you are of your goals, which will make it difficult for you to streamline the contract approval process and use your time better. These metrics will also help you to gain deeper insight into how your team works and if there are any aspects of the contract approval process that need further refinement or fixing.
All in all, Ironclad is a premier CLM that helps you master the contract approval process in contract management. With stand-out features like an intuitive Workflow Designer, a Data Repository, and a DOCX native collaborative platform, Ironclad will transform contracts from barriers to enablers.
If you’re interested in trying out Ironclad, request a trial today. Give our features a try, and you will see how you can reduce your contract processing time by 80%. You’ll also be able to work with our dedicated deployment team, who will help you make the most out of your Ironclad experience.