Managing contracts is a hassle for many businesses. We share what goes into good contract management and offer some resources to get your company on the right track to contract success!
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good For any business owner or freelancer, being able to keep up with contracts, licenses, and agreement documents is very important. This is because such documents are legally binding and are used to protect all parties involved. Contract management is often utilized to organize and properly file contracts.
So what is contract management? It is the process of managing the creation, implementation, and analysis of contracts for the purpose of maximizing overall financial and operational performance within a business. Project contract management reduces risk.
The stages of contract management are fairly simple:
- Preparing the contract. Identify the contract needs and set expectations for the contract.
- Authoring the contract. It is recommended to consult an attorney for this stage if the contract involves a substantial amount of money or risk.
- Negotiating the contract.
- Getting approval before finalizing contract content and clauses. This will involve all parties.
- Executing the contract.
- Keeping up with revisions and changes.
- Managing the contract after signage. This usually involves audits, revisiting obligations from both parties, and discussing renewals for the contract.
Virtually anyone sells a product or service can benefit from a good contract strategy.
Contract Management Software
If you’re taking on this task alone, you should know that there is contract lifecycle management software (also known as CLM) out there that can make your life much easier.
Contract management software involves applications that take on the smaller and more tedious tasks involved in contract management. These typically include:
- Establishing a centralized electronic library for contracts, documents, and all other records.
- Contract searching and management.
- Cloud-based contract security.
- Flowchart and spreadsheet generation for tracking contract status, party contacts, and other relevant pieces of data.
- Automated reminders for audits, reviews, and renewal dates.
- Access contract data and analyze said data with search functions, automated reports, and dashboards.
- Digital signature signing.
- Notifications for changes or discrepancies within a contract.
- Post-execution tracking.
If you do a quick search, you’ll likely find that there are dozens if not hundreds of contract lifecycle management vendors to choose from. Some products include Agiloft, CLM Matrix, Exari, GEP, and Spring CM.
We recommend reading up on contract lifecycle management platforms via Gartner for an unbiased overview of different vendors and companies. Contract lifecycle management overviews from Salesforce are also a good place to do some research.
Contract Manager Salary
As stated above, a contract manager salary is around $85,000 per year in the United States. However, this varies significantly depending on the level of experience, educational background, and location.
There is also the matter of different levels that make up the hierarchy of contract management. According to Glassdoor, https://www.glassdoor.com/ a director of contracts salary would on average be about $161,000 in the United States. A senior contracts manager salary would fall somewhere around $90,000 per year.
Location also has a large impact on salary for a contract manager. The contract manager salary in NYC is around $69,000 per year on average. The contract manager salary in Florida averages around $67,000 per year. A contract manager salary in DC is notably higher, averaging around $75,000 per year.
Contract manager salary qualifications for individual jobs make a big difference in salary. A contract manager with a Bachelor of Science (B.S.) degree in Finance may have more qualifications for a contract manager position than someone with lower-level certification. Experience is also a major factor when it comes to qualifications. Typically, contract managers with more experience, particularly when it comes to managing and drafting contracts for larger enterprises, would be considered highly sought-after.