The key to successful contract management is finding the right people for the job.
Contracts are a fundamental part of business operations, and as a business owner, it’s crucial to understand how to manage them effectively. However, not all businesses have the luxury of an in-house legal team to oversee contract management. This can make the process of managing contracts a daunting task, especially for small and medium-sized enterprises.
But fear not, managing contracts without an in-house legal team is not impossible. There are several practical tips and strategies you can use to ensure that your business is not only compliant but also protected from any legal risks that may arise from poorly managed contracts.
This blog post will explore some best tips for managing contracts without an in-house legal team. Whether you’re a seasoned entrepreneur or just starting your business, these tips will help you navigate the complex world of contract management and protect your business interests. So, let’s dive in!
Strategies for Managing Contracts Without In-House Legal
Effective and error-free contract management doesn’t have to come with the high cost of hiring a team of lawyers. By implementing the right strategies, you can efficiently manage your contracts without breaking the bank. Let’s highlight the four leading components of effective contract management.
- Compatible Contract Management Software
Having a functional contract management system is crucial for any business to stay on top of its contracts. Although paper contract management is still a possibility, it is challenging and may negatively affect a deal. Having the right CLM software can provide excellent tracking and storage capabilities, as well as many other benefits.
Some of the key features that you should look out for when selecting the right software are e-Signature tools, detailed version tracking, and remote working capabilities. Furthermore, it should be user-friendly and easy to use, even for non-lawyers and employees who may feel intimidated by new technology.
- Legally Reviewed Forms
To ensure smooth contract management, it’s important to have well-written forms and templates. Take some time to review your recent contracts, including those drafted by the other party, and identify the language that works best for your business. Choose the terms and format that best suit your needs, and consider developing multiple forms for different situations.
While a full-time lawyer may not be necessary for effective contract management, it’s a good idea to have outside counsel perform a legal review of your forms. This will help you identify any potential legal risks or issues and ensure that your forms are legally sound. Additionally, you can also discuss potential responses to any suggested changes or redlines with your attorney. Once you receive feedback, finalize your forms or boilerplate terms to ensure that they are accurate, effective, and legally binding.
- Proper Contract Management System
The most important aspect of contract management is the system used. An unorganized storage system increases the risk of using outdated forms and losing track of current ones. A good contract management system should keep all templates, executed contracts, and executed copies in one easily accessible place, preferably searchable from anywhere.
It should track all versions and signatures electronically and set alerts when a contract approaches termination or renewal. Having a strategy that includes optimal timing for contract renewals is vital. The system should also make it easy to find compliance issues or regulatory requirements to avoid legal battles and other complications.
- Capable Employees
