Any task looks difficult unless it is done for the first time and then repeated. This is especially true in the case of contract lifecycle management. The drafting of the contract before it is signed is a tedious process that requires manpower and time. However, once that stage is crossed successfully, it becomes easier to speed up the rest of the process. Alas, this is easier said than done because each contract sitting in your business office is unique and contextual.
That takes us to the pre-signature phase of contract management.
What is the pre-signature phase?
A contract lifecycle typically goes through several stages. A crucial phase is what is termed the ‘pre-signature phase’ that includes a number of activities before a contract is signed. This may look like a simple enough concept, but it practically involves a lot of pre-thought and pre-meditation. The pre-signature phase typically involves the following –
- Contract authoring – the drafting process of the contract
- Negotiation – drafting terms and getting both the parties to agree on terms
- Reviews – going through the conditions again for cross-checking and referencing
- Approval – from both the parties over the final draft
A pre-signature phase thus involves different departments which are responsible for getting certain steps done.
READ ALSO: What are Electronic Signatures ?
Why do you need to automate the pre-signature phase?
It is possible that as a business, you may be using a contract lifecycle management software. However, it is also quite likely that you may be using the tool after the signature stage of your contracts.
Here’s how this approach may turn out to be tedious and time-taking-
# Manual work
The process of drafting and reviewing the terms of contract needs manpower in the absence of an automated tool. This means the processing of any contract is dependent upon individuals before the contract reaches the signing stage. This may cause bottlenecks, resulting in delays and confusion.
Manual work usually entails errors since a contract is an exhaustive document, even during the pre-signature stage. Inaccuracies cause not only delays but also affect business relationships.
As a business, you are dealing with a tonne of contracts on a regular basis. If every contract were to go through a manual process before it is signed, the growth of your business would eventually suffer since many contracts will be stuck in the pre-signature process.
Success at the pre-signature phase is important
When the risks are assessed accurately before the contract is signed, it becomes easier to accelerate the processing of contracts. This is also the stage where the intent of the project or work is formed. When the objectives and the intent are clear between the two contracting parties, the rest of the contract process gets a clear direction. However, success in this pre-signature phase is important for various reasons. Such as –
# Planning leads to execution
A large part of the planning of the project takes place during the pre-signature phase of the contract. Here’s where all the details are anticipated, recorded, and acknowledged. Unless this plan is made at this stage, the contract cannot be executed. Therefore, when you automate the process of pre-signature on a reliable AI-powered contract software, it helps in recording and accessing crucial details important for the contract execution.
# Mapping of the next steps
At the pre-signature stage, the needs or requirements of the project are anticipated, risks are predicted and calculated. This is also the phase when the contract period is defined. Details such as this help both the parties in honoring the contract at a later stage and prepares them for the next steps.
# Foundation of understanding
The pre-signature phase undoubtedly sets the stage for future relationships. This initial stage of discussion, drafting, and reviewing helps in building a strong foundation between the parties for future relationships.
Why should you consider automating the pre-signature phase?
You must invest in a contract lifecycle management software that automates the stages and steps of the pre-signature phase as well. You can save a lot of time and resources, such as contract drafting or authoring. Drafting a plan or reviewing the contract manually creates bottlenecks that can easily be saved through automation. An AI-powered contract software also eliminates the chances of error and confusion.
# Establishing transparency
Initially, both parties struggle to establish trust. This is the beginning of a new business relationship, so both parties need a more neutral and reliable platform where information can be sourced and referenced. One huge benefit of an automated pre-signing tool is that it defines roles and responsibilities based on the pre-fed information, and these can be accessed by a dashboard by the concerned parties. This goes a long way in establishing transparency between the parties.
# Speed, time, money
As is the case with any automation, the tool saves time, resources while accelerating the contract process. Imagine processing hundreds of contracts manually before they are signed. That will require manpower that can be put to better use and will save time that can also be more creatively used towards business growth.
# Setting up the contract for success
The complexity of contract management, such as legal clauses, terms and conditions, context, renewal periods, etc., makes it hard to execute the actual contract. A lot of times, errors of omission occur even though the concerned party is honest and willing to honor the terms. When you automate the pre-signing stage of the contract, you set your contract up for success. Things such as renewal notifications are set, legal clauses are cross-checked and fed into the software for future references, relationships are defined, and roles are accessible through the dashboard.
# E-signature support
Contract management software such as Revnue provide e-signature tools right within the software. When you automate the contract from the initial stage, you also unlock the benefits of e-signature that further increase the efficiency of the process and help you speed up.
# Efficient contract drafting
A good pre-signature module really helps in drafting the contract flawlessly. Since most of the process becomes automated, and much of the information is already recorded, it becomes easier and faster to draft a contract and get it in motion.
We are here to help
If you feel like the task of drafting the contract is daunting, we are here to help. We will walk you through the process of our pre-signature module and help you execute it efficiently along with careful handling of your contract lifecycle management. Talk to us.