As enterprises scale, the number of contracts they need to manage grows as well, imposing a mounting burden on legal teams. These teams can become overloaded as they constantly spend more time on contract authoring, reviews, and tracking. And this chips away their time and ability to focus on more strategic tasks, such as negotiating better deals or advising on legal risks.
And while this in itself presents a problem for large enterprises, it is often overlooked that business users who are charged with the responsibility of contract authoring are also struggling. They often feel lost in the process. They encounter difficulties in crafting legally compliant contracts due to their limited familiarity with legal terms, regulations, and procedures.
In this blog, we will explore how contract authoring tools can help bridge the legal gap and empower both legal and business users alike.
Before beginning the conversation about their dual benefits, let’s understand what best-in-class contract authoring tools are and what they are capable of accomplishing.
What does a best-in-class contract authoring tool look like?
Contract authoring tools are software applications designed to simplify the process of contract creation. These tools typically offer features such as pre-approved templates, standardized clauses, and approval workflows to guide users through contract creation. As a result, they enable business users to create contracts that are accurate, complete, and compliant with legal requirements.
A best-in-class contract drafting and authoring tool:
- Has a user-friendly interface and a library of pre-designed templates to save time and ensure consistency.
- It allows for easy collaboration among multiple users, has version control to track changes, and enables electronic signatures to streamline the process.
- It integrates with other tools, such as document management systems, and has robust security features to protect sensitive information.
- Allows for customizability, allowing users to tailor the tool to their specific needs and workflows.
Overall, best-in-class contract authoring tools provide an efficient, streamlined, and secure way to create and manage contracts. And in doing so, these tools offer a dual advantage to business users and to legal teams, allowing both entities to collaborate more seamlessly in order to draft legally compliant contracts faster.
3 ways contract authoring tools empower business users
1. Standardized templates and clauses: 44% of legal professionals reported that contract drafting is the most time-consuming part of the contracting process. This is primarily owing to the friction in the process of drafting legally sound contracts. Business users who are owners of deals and contracts are often unaware of the right process and terms to get their contracts rolling. There is a huge reliance on the expertise of in-house counsel to assist them in the drafting process.
Contract authoring tools address this issue by allowing business users to access a library of standardized templates and clauses that have been pre-approved by the legal team – and are ready and easy to use, all on a centralized platform.
This removes the ambiguity from the process of drafting contracts from scratch and reduces the friction in drafting legally compliant contracts. Essentially, it ensures that contracts are consistent and compliant with legal requirements, even if the user is not familiar with legal terms and language.
2. Approval workflows: Advanced CLM tools include contract approval workflows that guide users through the approval process, ensuring that contracts are reviewed and approved by the appropriate parties. This eliminates the need for business users to manually track down signatures and approvals, freeing up their time to focus on other tasks.
A recent study by the Aberdeen Group found that companies with best-in-class contract management practices have an average contract review and approval time of 2.7 days, compared to an average of 5.8 days.
This is a clear indicator of how contract authoring tools remove tight bottlenecks in the approval process during early contract stages and ensure business users aren’t caught waiting for lengthy approvals.
3. User-friendly interface: Authoring tools typically have a user-friendly interface that makes it easy for business users to create contracts. This eliminates the need for extensive training in legal language and procedures, allowing business users to create contracts quickly and efficiently.
These tools usually work on low code/no-code functionalities and integrate with easy-to-use word processors (e.g., Microsoft Word). This ensures easy adoption and maximizes the gains business users can derive from contract authoring digitalization.
How do contract authoring tools empower legal teams?
By assuming the above routine tasks and providing a relatively friction-free contract authoring environment, authoring tools unburden legal teams, allowing them to devote their attention to more consequential and strategic initiatives.
With greater freed-up time, legal teams can spend more time on more strategic tasks such as complex contract negotiation, providing legal advice, and ensuring compliance with legal regulations. This shift in workload allows legal teams to become more proactive rather than reactive and focus on tasks that are critical to the success of the business.
Here is a whitepaper that dives deeper into how contract automation can empower your in-house legal teams.
Using contract authoring tools is a win-win for both business users and legal teams. Business users are empowered to create their own contracts and get faster approvals, while legal teams are freed from supervising routine, run-of-the-mill drafting processes and are able to focus on more strategically important tasks such as negotiating better deals or advising on legal risks.
If you would like to know more about Zycus’ best-in-class contract management tool, click here and book a consultation call with our solution experts.