If there’s one thing that can weigh down the savviest of CFOs, it’s contract management. These days, detailed contracts outline every aspect of thousands of projects from concept to completion. Skipping any of the benchmarks or review periods within these contracts could lead to a lost opportunity to address what’s going wrong or collect money for poor provider performance.
CFOs and other executives can get an assist from contract management software that tracks every stage of a contract and alerts CFOs to when they should be involved. For instance, Emptoris just released Enterprise Contract Management Version 8.2 as one product that may help ensure that all agreements get the attention they require and to mitigate risk.
The Emptoris software suite is one way CFOs can monitor all aspects of a contract, including agreed-upon business terms, milestone dates, guaranteed service levels, discounts and penalties. As each of these key elements is due for consideration, an alert is sent to project stakeholders. For example, the contract leader might receive a reminder on the software’s dashboard that an interval is coming to an end and, therefore, they should consult with project members to see what needs to be re-negotiated.
Also, the software can automatically request and aggregate feedback from authorized employees. Through this process, it might come to light that a provider has not met its guaranteed SLA levels and should refund money. Or the CFO could discover that the team doesn’t think the provider is as responsive as it could be. This might spark the CFO to put the contract out to bid to other providers.
In the past, CFOs would have gone office-to-office to uncover such critical information. Most likely, they would have just re-signed the contract, not knowing what pitfalls had occurred during the last term.
Now such companies as Ariba, Oracle and SAP — along with Emptoris — also offer automated contract management software.
The contract management tools they offer also allow CFOs to share the contract burden. They can assign team members tasks such as tracking SLA accordance or achieving milestones by the provider and the organization itself. If at any point, these goals aren’t met, CFOs can take immediate action.
In the end, taking this software-driven approach could help the business avoid money-pit contracts, have rock-solid provider delivery and response times, save on litigation and fines, and eliminate other damaging outcomes.