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5 Ways Automated Contract Tracking Makes Your Team More Efficient

Spreadsheets have existed since the late 1960s. When they first emerged, spreadsheets offered a number of advantages over traditional paper-based systems. The adaptability of spreadsheets made them popular for a number of applications, including managing and tracking contracts. Spreadsheets always contained limitations for contract tracking, however. Today, automated contract tracking platforms offer ways to overcome the key limitations of spreadsheets while preserving access to essential contract-related information.

Spreadsheet Tracking Is Outdated

Spreadsheets remain a popular way to track contracts, despite their shortcomings. A ContractWorks survey recently revealed that 32 percent of in-house attorneys use spreadsheets to track end dates, renewal windows and other key information, writes Andy Silverman.

Every organization that manages multiple contracts needs a system to manage the information those contracts contain. “Contract management helps control funds, reduce risks, and stay on top of performance,” writes Yuri Zaremba, general manager at contract lifecycle management platform Axdraft.

Manual processes like spreadsheets introduce several inefficiencies, however. Zaremba notes that these inefficiencies include:

  • Losing track of necessary information, including the specific terms of each contract.
  • Missing opportunities to reuse effective language in past contracts to improve current and future agreements.
  • Facing miscommunication and misunderstandings related to a failure to have ready access to a contract’s language.
  • Failing to comply with government requirements or company policies for contract language and terms.
  • Missed deadlines.

To demonstrate the value lost in inefficient contract management, Zaremba offers a hypothetical: “If a lawyer’s average hourly rate is $90, how much money does your company lose annually on mere copying and pasting data across legal documents?”

Group of professionals gathered around a laptop, phones in hand; automated contract tracking concept

How Automated Contract Tracking Addresses Spreadsheet Shortcomings

Spreadsheets are easy to use and to customize. These features make spreadsheets appealing for contract management — but they aren’t sufficient for effective management.

Spreadsheets’ top shortcomings include:

  • Few or no monitored access controls.
  • High risk of error through manual data entry.
  • Limited reporting capabilities make it difficult or impossible to create useful reports.
  • No way to audit activities in the spreadsheet or data entered.
  • No automated workflows or reminders.

Automated platforms, by contrast, are specifically designed to overcome these issues.

Role-Based Access and Other Monitored Access Controls

Automated platforms typically incorporate monitored access controls, often through role-based access. These controls manage who can view, edit or download specific information within the platform, writes Ellen Zhang at DataInsider. Users are restricted to the information they need, and prevented from viewing information they are not authorized to handle.

Automated Data Entry and Error Checking

Every time a human user enters data, a risk exists that the human user will enter the information incorrectly.

In a 2019 study in the Journal of the American Medical Informatics Association, researchers James A. Mays and Patrick C. Mathias found that 3.7 percent of manual data entries at an outpatient testing facility “were discrepant from their interfaced result.” In over 14 percent of these cases, the error differed from the correct result by more than 20 percent, introducing dangerous risks to patients.

The researchers noted that automated data entry could reduce the risk of these errors. They also noted that automated systems could flag potential errors for review, providing targeted oversight.

Customizable and Configurable Reporting Capabilities

Spreadsheets offer limited report generation capabilities, and maximizing these capabilities often requires extensive knowledge of the spreadsheet software. Automated platforms integrate flexible, cutting-edge report-generating tools.

In doing so, these platforms make it easier to track essential information. They also allow users to configure and customize reports and dashboards, so the information each person needs is at their fingertips.

Onboard Auditing Tools

Spreadsheet software does not typically track user activity in the software. When data is changed or added, the software does not record who made the changes, when they were made, or what the previous version looked like.

A lack of auditing tools can lead to serious problems. In an article in Spectroscopy, R.D. McDowall cites the case of a medical laboratory that received a warning letter from the Food and Drug Administration regarding its use of spreadsheets. Among the FDA’s concerns were that the company’s “procedures lacked guidance on how to check and manually verify the calculation sheets.” The FDA investigators spotted at least one calculation error in the spreadsheets used.

Automated contract management tools track users’ activities within the platform automatically. This information can be retrieved to audit the use of the platform. It can also provide transparency when data entry or other errors do occur. Automated platforms provide oversight by checking and verifying calculation sheets. By doing so, they reduce the risk of error and accompanying regulatory citations.

Automated Workflows and Reminders

The more contracts an organization has, the easier it is to lose track of key dates and deadlines. Even when a spreadsheet includes a column for these time-sensitive items, something as simple as an incorrectly-executed sort function can cause users to lose track of dates and deadlines — to the detriment of the entire business.

Automated platforms build in tools to communicate workflows and flag key dates, such as the date a project is due or the renewal window for a particular contract. These tools allow teams to focus on their work, confident they won’t miss a key moment.

“For any business to embrace change it must move away from outdated manual processes and evolve new digital ways of working,” writes Alan Murphy, senior HR director at DocuSign. Automation allows organizations to manage contracts more effectively by applying modern digital tools.

Woman working on spreadsheets, with two laptops; automated contract tracking concept

Efficiencies Gained in Automated Contract Tracking Platform Use

An automated contract management platform offers several opportunities for greater efficiency, improved performance and enhanced compliance. Automated platforms meet these goals by offering:

  • Visibility. Easily track the terms of contracts through dashboards and visualization tools that highlight critical information. Customizable and configurable platform tools allow each team member to track the information that is relevant to their role in the project.
  • Reminders. When are your obligations due under a contract? What’s your timeframe for renewing the contract — or terminating it? An automated platform puts this information at your team’s fingertips.
  • Data retrieval. Retrieving stored data is much quicker than retyping information each time. Automated data retrieval reduces the time your teams spend on drafting contracts, allowing them to focus on fulfilling agreements instead.
  • Completeness and flags for missing information. Improve compliance, prevent misunderstandings and spot potential problems quickly with an automated platform that screens for completeness and flags missing or potentially incorrect information for review.

Automated platforms also offer built-in analytics. While analyzing data from spreadsheets remains a manual and challenging process, analyzing data within an automated platform is often as simple as asking the system to retrieve and cross-reference specific variables. These analytics allow for deeper insights into nearly every aspect of a project or business’s overall goals.

When they first appeared in the business world, spreadsheets represented a significant leap forward from paper-based methods of tracking data, contract information, deadlines and other essential business information.

Today, however, spreadsheets fall short of existing automated contract tracking platforms in a number of key areas. By switching to an automated platform, an organization can improve its contract adherence, avoid miscommunications and legal or regulatory penalties, and gain a deeper understanding of its own projects and successes.

Images by: Christin Hume, langstrup/©, lacheev/©