Discover how cloud-based contract management software can transform inefficient and fragmented contract processes in this guide.
Cloud-based solutions have transformed the way businesses operate in recent years, with research by RightScale revealing that 94% of enterprises have adopted cloud technology in some form.
But what role can cloud technology play in the way we manage contracts? Can cloud contract management software improve processes and outcomes for your business? Read on to find out.
What is cloud-based contract management?
Cloud-based contract management describes the use of cloud technology to store and manage contracts online, rather than offline and in local drives.
The cloud is a network of servers hosted on the internet. This means that teams using cloud-based contract management software can create, store, track, and manage contracts in a shared workspace, so long as they have an internet connection. (Read more about cloud storage options in this guide from Cloudwards).
How does cloud contract management work?
Cloud contract management works by storing all contract-related data in a secure, cloud-based platform that can only be accessed by authorized users.
Juro is a great example of cloud-based contract management because the tool is completely browser-based, allowing teams to access and work on contract-related tasks in one unified workspace.
Juro users can manage every stage of the contract lifecycle in the platform, and all of the data is hosted on the internet. This makes it easy for the relevant teams to access, but with strict security measures that restrict this access to certain individuals.
The idea is that cloud contract management strikes the perfect balance between security and accessibility - something previous applications that lacked two-factor authentication and encryption failed to do.
It’s also helpful to understand cloud-based contract management by considering what it replaces, so let’s run through the alternatives.
What is the alternative to cloud-based contract management?
There are two main ways to manage contracts without cloud-based contract management, and both are painful for different reasons.
1. Physical contract management
Firstly, businesses can take a paper-based approach where their contracts are stored in physical filing cabinets and signed using wet ink signatures. To collaborate on contracts, parties need to be present in one place and have physical access to the document.
This causes a few problems, including that the files are prone to being lost, tampered with, or misplaced. It also means that contract management is more demanding since there’s no possibility of automating routine contract admin or collaborating on these contracts remotely.
2. Manual contract management
The second alternative involves digitizing contracts but storing them offline and sharing them as static files. This is slightly a better, more efficient approach. However, it’s still flawed.
In this approach, contracts are created in an editor like Microsoft Word and shared with counterparties via email. Counterparties then download the Word file and work on a separate version, which they share through email once again.
This solves the problem presented by physical documents in that parties no longer need to meet in person to review or negotiate a contract. It also means that businesses can move towards a paperless office and store contracts more securely.
However, there’s still a lot of friction. Teams are forced to jump between different tools and work in separate versions, rather than in one centralized workspace on a shared copy. This makes it painful to collaborate on contracts and it often slows down the contract lifecycle as a result.
Cloud contract management removes this pain and friction experienced by legal teams by enabling teams to centralize contract storage, improve contract security, and streamline collaboration. Let’s cover these benefits in more detail now.
Benefits of cloud contract management
1. More collaborative
Cloud-based contract management systems make it easier to collaborate with remote teams and stakeholders by enabling them to work on the same contracts simultaneously, from anywhere and at any time.
Alongside this, cloud contract management tools like Juro also have features that are designed to make contract workflows more collaborative, including automated approval workflows, browser-based contract redlining, contract reminders, and more.
2. Increased efficiency
Cloud-based contract management software streamlines the contract management process by hosting the entire contract lifecycle in one workspace. This removes the need for teams to transfer data back and forth between different tools, which typically wastes a lot of time and resources.
Many cloud contract management tools also improve efficiency through automation. For example, tools like Juro enable teams to automate admin-heavy processes like contract drafting, tagging, approving, signing, and reporting. Automating these tasks frees up the legal team’s time for higher-value work.
3. Enhanced security
Cloud contract management software offers robust security features, such as data encryption and granular access controls, ensuring that only authorized personnel can access sensitive contract data. It’s difficult to guarantee the same level of security when contract files are shared and hosted offline, but such security is often guaranteed under the terms of a cloud services agreement.
Juro’s cloud-based contract management software meets the gold standards for security, with SOC2 type 2 compliance status, Cyber Essentials certification, powerful data encryption, and two-factor authentication. To find out more about Juro’s advanced security features, get in touch.
4. Cost savings
It’s estimated that ineffective contract management processes cost businesses up to 9.2% of their annual revenue. By streamlining the contract process to make it more secure and efficient, cloud contract management software can reduce value leakage and ensure you capture (and keep) as much revenue as possible.
Cloud contract management software also eliminates the need for printing, scanning, and filing paper documents because all of the contracts are stored and accessed online. This can help to reduce operational costs, too.
Cloud-based contract management software: which is best?
There are several cloud-based contract management software solutions on the market., each with different features and capabilities.
However, it’s important to flag that certain solutions still rely heavily on static files and other tools throughout the contract lifecycle, meaning users won’t get the full benefits of a cloud-based contract management tool.
For example, legacy CLMs rely on Microsoft Word during the editing and negotiation stages. This means that documents continue to be moved back and forth between tools, making simple contract edits painful. This is clear from the independent review shared by a legacy CLM solution user:
For something as simple as correcting a typo, you have to download the template, correct it in Word, and re-upload. It feels unnecessarily cumbersome - Legacy CLM user, G2
By comparison, Juro offers native, cloud-based functionality for ever stage of the contract lifecycle, including the creation and editing phase:
Juro have done a cracking job at making it really easy to create contracts and make edits to those contracts afterwards. I'm always impressed at how easy it is to make changes and adjust formatting - Verified Juro user, G2
Unlike traditional CLM tools, Juro isn’t built around static files. Instead, Juro is collaborative, flexible and data-rich, enabling teams to reap the benefits of cloud-based contract management and agree and manage contracts in one unified workspace.
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