Contract management is the process of handling contracts throughout their lifecycle—from creation and negotiation to execution, performance tracking, and renewal.
As the definition suggests, it’s a pretty complex process that comes with many challenges, yet it’s one every business needs to handle.
And the way you handle contract management can define your business’ overall success.
For example, poor contract management may lead to:
- an average of 9.2% of annual revenue lost due to contract mismanagement,
- around $2.5-$3.5 million spent on searching or recreating lost documents (for businesses of 1000 employees),
- a lot of time spent on managing contracts—for example, 97 days for renewing these documents alone.
That’s where an effective contract management strategy comes into play to save the day.
A proper contract management strategy with a generous sprinkle of automation in the right spots can help you a lot.
Going with a real-life example, Medicover—a provider of comprehensive employee benefits increased their contract management success by implementing the Autenti platform.
Switching traditional contract signing to a complete digital solution with e-signatures, Medicover reduced the time needed to sign documents from two weeks to just one day.
Read the guide below to learn how to replicate Medicover and other successful companies' success in contract management exactly.
We’ll go through solid contract management strategies for different stages of a contract management process, from establishing ownership to audits & improvements.
Table of contents
1. Step 0: establish clear ownership & assign key stakeholders
2. Step 1: establish goals & KPIs to track
3. Step 2: define clear workflows & templates
4. Step 3: switch to electronic contract signing, sharing & storing
5. Step 4: automate what you can
6. Step 5: establish a contract renewal & exit strategy
7. Step 6: conduct audits & improve
8. Manage contracts 90% faster with Autenti
Step 0: establish clear ownership & assign key stakeholders
Before diving into contract management, it’s crucial to establish clear ownership and assign key stakeholders to specific areas. Without defined responsibilities, contracts can easily fall through the cracks, leading to missed deadlines, compliance issues, and financial losses.
Therefore, step zero in your effective contract management strategy should definitely be establishing clear ownership before anything else takes place.
Why?
This report on contract management in technology and software sectors, highlights that in almost 40% of organizations it is unclear who has responsibility when it comes to contract management.
In turn, $140 billion is wasted every year due to lack of collaboration between commercial and legal teams—perfectly highlighting how besides just ownerships and stakeholders, the communication between them is equally important.
Different teams play important roles in contract management, and each should have clearly defined responsibilities. For example:
- Legal teams: should make sure that contracts comply with laws and company policies. They review legal risks and dispute resolution terms.
- Procurement/purchasing teams: manage vendor agreements, negotiate terms, and ensure contracts align with purchasing policies.
- Finance teams: are responsible for monitoring payment terms, budgets, and financial risks associated with contracts.
- Sales/business development teams: own client contracts, ensuring terms align with business goals and revenue models.
- Operations/project managers: watch over contract deliverables and milestones. They also track performance metrics.
- IT & compliance teams: handle data security, GDPR compliance, and software agreements in tech-related contracts.
Given that, take a look at the do’s and don’ts in step zero of defining your strategy:
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✅ Do’s:
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❌ Don’ts:
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Assign a contract owner responsible for each stage of the contract management process (e.g., legal, procurement, finance).
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Avoid ambiguity—without ownership, contracts fall through the cracks.
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Clearly define stakeholders’ roles (e.g., approvers, reviewers, compliance officers).
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Don’t forget about stakeholders and make sure they know they’re specific tasks and areas.
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Have proper accountability, for example with role-based access in contract management systems.
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Don’t let contract owners work in silos—communication between departments is crucial. Go for collaborative contract management instead.
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💡 Tip: use a RACI Matrix (Responsible, Accountable, Consulted, Informed) to map out stakeholder responsibilities clearly.
Step 1: establish goals & KPIs to track
Strategic approach to contract management follows up defined ownership and stakeholder roles with setting clear goals and establishing key performance indicators (KPIs) to track contract management success.
Without measurable objectives, it’s impossible to then analyze and improve business’ contract management performance, identify inefficiencies, or optimize processes.
How to define your goals, though?
Your contract management goals should align with broader business objectives, such as improving efficiency, reducing risk, and increasing profitability.
For example, you can think about the following goals:
- Reducing contract approval time—so that you shorten the contract lifecycle and boost operational efficiency,
- Reducing the time it takes to sign contracts,
- Reducing the cost per closing each contract.
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✅ Do’s:
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❌ Don’ts:
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Define measurable goals and use real-time dashboards to track contract KPIs.
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Don’t set vague, unmeasurable KPIs—make them SMART (Specific, Measurable, Achievable, Relevant, Time-bound).
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Track various KPIs like contract cycle time, renewal rates, and compliance status.
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Avoid neglecting different areas.
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Align KPIs with business objectives to ensure contract value.
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Don’t neglect business objectives when setting KPIs.
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Step 2: define clear workflows & templates
Once goals and KPIs are set, the next step is to establish standardized workflows and contract templates to follow it up with efficiency.
A well-defined contract workflow minimizes delays in the contract process, reduces errors, and streamlines contract management from drafting to execution.
Contract templates on the other hand usually simply speed up the time it takes to execute repeating contracts—instead of reinventing the wheel.
In fact, 75% of in-house counsel are dissatisfied with their current contract workflow technology. Strategic contract management can certainly change that for the better.
Now, how to define a simplified workflow? You can start by going off of the following process with common contract management stages:
- Contract request & initiation, aka who starts the contract? (sales, procurement, legal, etc.)
- Drafting & template selection, should you use a pre-approved template or start from scratch?
- Internal review & approval—define who must approve and set response deadlines.
- Negotiation & redlining. Here, track version history and changes made during negotiations.
- Approval & execution for which you can use e-signatures to eliminate manual delays.
- Storage. Once everything’s signed and sealed, centralize signed contracts in a secure repository.
- Ongoing monitoring—set reminders for renewals, audits, and obligations.
Now, take a look at the do’s and don’t for this step of the process.
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✅ Do’s:
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❌ Don’ts:
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Map out a step-by-step workflow from drafting to execution.
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Avoid one-size-fits-all workflows—customize based on contract type.
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Set clear approval hierarchies to prevent bottlenecks.
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Don’t let approvals take too much time. Instead, establish time limits for each step.
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Maintain a library of pre-approved templates to improve efficiency.
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Don’t rely on manual processes—they slow down contract execution. Automate where you can, like with e-signatures instead of paper signing.
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Step 3: switch to electronic contract signing, sharing & storing
Now, one of the best ways to improve your contract management is by automating and digitalizing at least parts of the process.
One of the modern contract management strategies you can use is switching from traditional to paperless electronic signing.
Take a look at the story of TZMO Group who switched from traditional to electronic contract signing and reduced their contract processing time up to 90% as a result.
Before switching to e-signatures using Autenti, TZMO contract signing processes took up to two weeks for national contracts and even up to three months for international ones.
Employees printed documents, gathered signatures, and sent them by courier, which extended processing times massively.
Now, they finalize documents even within a few hours, all with Autenti as their e-signature platform.
Switching to electronic contract signing is not just a time-saver, though. It’s also:
- Improved security & compliance: e-signature platforms, like Autenti, provide proper encryption, audit trails, role-based access, and meet global security and legal standards, like eIDAS (EU), ISO, GDPR, and more.
- Better accessibility: you can sign contracts from anywhere, anytime. Electronic signatures are ideal for remote teams and global businesses. Plus mobile-friendly interfaces allow signing even directly from your phone.
- Reduced costs & environmental impact: using e-signatures instead of paper contracts saves money on printing, courier services, storage, and manual processing. It also eliminates paper waste.
- Better contract tracking: automated notifications and reminders for signing new documents prevent delays and missed deadlines. Moreover, real-time status tracking ensures transparency throughout the signing process.
💡 Tip: Choose an e-signature provider that offers all three main e-signature types in basic plans, like Autenti, to not overspend on higher-tiered plans just to reach all e-signature types.
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✅ Do’s:
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❌ Don’ts:
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Implement an e-signature software, like Autenti, for faster contract execution.
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Avoid traditional contract signing which is error-prone and time-consuming.
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Store contracts in a centralized digital repository for easy access.
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Avoid manual storage—misfiled contracts lead to revenue loss.
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Use cloud-based sharing with role-based permissions for quick contract signing.
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Don’t ignore backup & disaster recovery plans for digital contracts.
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Step 4: automate what you can
Contract management involves numerous repetitive tasks—drafting, approvals, tracking renewals, and compliance checks.
Automating what you can reduces human error and speeds up contract lifecycles, ultimately saving time and money throughout the contract lifecycle process.
Automation can happen with contract management software, which helps with things like automatic notifications and reminders for contract renewals and overall automated contract management.
In fact, automation of contract management processes accelerates negotiation cycles even by 50%. Lawyers particularly reported that automation of contract management has saved them as much as 82% of their time.
What can you automate in contract management?
- Contract drafting and templates: you can use pre-approved templates with auto-fill capabilities to generate contracts quickly.
- Whole workflows: you can set up automated routing so contracts go to the right stakeholders at the right time (e.g., legal, finance, procurement) based on predefined rules.
- Signing reminders: you can set up automated reminders for pending e-signatures for faster execution. Such a feature is available on the Autenti platform.
- Renewals: AI can help you with tracking your contracts to identify documents nearing expiration.
- Performance & KPI tracking: you can also auto-generate real-time reports on contract cycle times, cost savings, and compliance rates.
With automation, there are also a few practical things to remember:
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✅ Do’s:
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❌ Don’ts:
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Automate renewal reminders, compliance tracking, and contract approvals.
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Don’t automate without human oversight—AI can flag issues but needs reviews to help avoid any hallucinations.
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Use AI-powered analytics to identify risks and cost-saving opportunities.
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Don’t do partial, nitpicked automation—implement a holistic system instead.
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Integrate automation tools with your existing tech stack.
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Don’t forget data security—check whether automated systems have encryption and compliance measures in place.
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💡 Tip: using electronic signature software with mass-signing can help you deal with handling numerous documents, especially repeating ones.
Step 5: establish a contract renewal & exit strategy
Best contract management strategies also prepare well for contract renewals and possible contract terminations.
That’s because managing contracts doesn't stop at signing and living out the terms—you need a structured renewal and exit process to maximize contract value while avoiding unnecessary risks or costs.
Why this step is important:
- Many businesses miss renewal deadlines, leading to automatic renewals with unfavorable terms.
- Poor exit strategies can result in legal disputes, financial losses, or data security risks when contracts end.
- Proactive renegotiation of contracts helps improve terms, pricing, and compliance.
For example, 71% of companies cannot find 10% or more of their contracts, which makes renewals and terminations that much more difficult.
Take a look at the best practices for this step and find out which ones should you avoid completely:
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✅ Do’s:
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❌ Don’ts:
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Identify renegotiation opportunities. Perhaps you’ll be able to optimize pricing, terms, and service levels.
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Don’t let contracts auto-renew blindly. Always reassess terms before renewal.
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Define clear termination procedures. Go for a structured and legally sound contract exit process.
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Don’t overlook contract dependencies. Have any linked contracts (e.g., vendor agreements) align with renewal plans.
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Put emphasis on data security & compliance. Safeguard sensitive information when ending vendor contracts.
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Don’t ignore legal or compliance risks. Make sure exit clauses are followed correctly.
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Step 6: conduct audits & improve
Even the best contract management system requires regular audits and improvements to make sure you’re moving in the right direction.
Conducting audits helps identify risks, inefficiencies, and areas for optimization, helping you deliver more and better over time.
But how do you conduct an effective contract audit?
Well, you can:
- Define the scope of the audit:
- Determine whether you’re auditing for compliance, efficiency, financial performance, or contract risk assessment.
- Decide if the audit will cover all contracts or a specific subset of them (e.g., vendor agreements, client contracts).
- Review contract obligations & compliance:
- Check if all parties have fulfilled their contractual duties.
- Make sure contracts adhere to industry regulations and company policies.
- Identify missed deadlines, penalties, or renewal issues.
- Assess financial & risk exposure:
- Identify hidden costs, financial risks, and revenue leaking.
- Analyze whether contract terms are financially favorable and actually align with business goals.
- Evaluate contract performance & vendor/client relationships:
- You can measure customer contract satisfaction.
- Identify underperforming contracts that need renegotiation or termination.
- Track dispute resolution timelines and contract enforcement rates.
- Identify process improvements:
- Spot inefficiencies in contract creation, approvals, and renewals.
And always remember to follow each audit with actually implementing changes & continuously improving based on the findings.
Train teams on best practices and lessons learned from the audit and set new KPIs to monitor ongoing contract performance.
Apart from all that, remember about the do’s and don’ts in the final step of creating your contract management strategy:
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✅ Do’s:
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❌ Don’ts:
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Schedule quarterly or annual audits to evaluate contract performance.
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Don’t skip audits—contract inefficiencies accumulate over time.
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Gather feedback from stakeholders on process effectiveness.
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Don’t ignore stakeholder feedback—involve legal, procurement, and finance teams in contract improvements.
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Optimize workflows based on audit findings.
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Don’t skip reviewing older contracts—legacy agreements often contain hidden risks.
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💡 Tip: this is the part where AI can be particularly helpful.
Manage contracts 90% faster with Autenti
The question of “do I need a contract management strategy?” is an obsolete one. Every business needs a proper contract management strategy to survive the many documents they manage.
Apply the best practices we’ve discussed above when developing a contract management strategy you’re going to follow.
Why?
Because a well-executed contract management strategy enhances efficiency and profitability. Truly bringing out the many benefits of contract management to light.
With Autenti, you can manage contracts and other business documents even 90% faster, like TZMO, Medicover, and others already did.
Start your 14-day free trial with Autenti, today.
