To succeed in their roles, contract administrators and managers must have a meticulous eye — making sure every ‘t’ is crossed, every ‘i’ is dotted, documents are formatted consistently and all contracts are written as precisely as possible.
Often, organizations must execute the same type contracts for multiple vendors, suppliers or customers, and contract managers can use contract templates to expedite contract creation and review. Using contract templates also helps prevent the introduction of errors and deviations from pre-approved contract language, but it’s important not to overlook a few important details for the sake of streamlining contract processes:
Have a library of contract templates, not just one.When your organization first started, perhaps you started with a single contract template. As you’ve grown into a large enterprise, you likely use that same template, but hopefully it has evolved into several different iterations — with different clauses and terms, depending on the contract type, purpose and with whom you’re entering into the contract. You should have (and routinely review) different contract templates for vendors, suppliers and customers, and can segment these categories even further by having templates for each industry in which your partners operate.
Standardize contract templates.Again, as your legal team develops multiple contract templates, be sure to establish a standard for formatting so that — even as the templates continue to evolve and grow — all contracts across the board carry a similar structure and tone.
Set automated alerts to review standard forms and contract templates.
Legal teams often have issues assigning responsibility to maintain standard forms, contract templates and best practices. Having outdated forms and templates are useless, and defeat the purpose if contract managers have to waste time and effort making heavy revisions.The simplest way to get attorneys to remember to review these standardized documents is by sending automated email notifications through a contract management system. The alerts can request that the attorney review and approve the form or template, or send it to other reviewers as necessary.
Know your audience when it comes to domestic vs. international contract language. If your company does business in multiple countries, make sure the language in the contract templates are adaptable to the specific country’s requirements, regulations and customs.
Track changes and version histories of contract templates. Both domestic contracts and foreign contracts need to be kept in a contract management system that will track changes and version histories of templates, so there’s always a record of what was changed by whom. Keeping printouts of marked-up changes by contract managers doesn’t count — your legal team needs a contract management system that will automate processes, allowing you to:
- Standardize contract creation, ensuring fewer departures from already-approved contract language
- House all contracts, supporting documents and templates in one central document storage for quick, convenient search and access
- Create standard workflows for drafting, reviewing, revising and approving contract templates
- Save records of all revisions, version histories and comments on a contract or template
- Provide each legal team member with an individual login (integrated with Microsoft Active Directory if the contract management system is on SharePoint) so the employee’s progress, activities and tasks can be tracked via real-time dashboards
- Produce ad hoc reports from captured metadata
There’s great value in using contract templates — they can save your legal team time and effort — but only when maintained and used properly. When the crux of contract managers’ jobs depends on good documentation and document management, why not upkeep and use contract templates?
Using contract templates is just one step in a larger effort to streamline the contract workflow. See how to establish, evaluate and improve current contract processes by getting our free, step-by-step guide below, which walks you through how to ensure your contract management and legal team works at its most efficient.
Also read how contract managers are facing tough balancing act.