Contract management software

Contract management software is the range of computer programmes, libraries and data used to support contract management, contract lifecycle management, and contractor management on projects. It may be used with project management software.

Advantages and key functions

Most sophisticated projects involving contractors now use contract management software instead of relying on the manual management of paper contracts. It has become an essential tool for keeping track of multiple activities with cost implications, and can be especially helpful for automating administration, ensuring compliance and triggering alerts.[1]

Contract management software is produced by many companies, working on a range of scales and offering varying degrees of customisability. Basic functions should include the ability to store contract documents, track changes to contract documents, search documents for a particular criterion, and to report required aspects of the contract.[2] Other functions include managing a new contract request, capturing related data, following a document through a review and approval process, and collecting digital signatures.[1]

Contract management software may also be an aid to project portfolio management and spend analysis, and may also monitor KPIs.[3]

Since a contract involves a client or operator working with one or more separate contractors, contract management software must assist all parties in communicating and keeping records across company boundaries.

Contract risk management software (CRMS) for capital projects

Very large enterprises, such as capital expenditure (capex) projects, involve multiple parties and high risk and uncertainty. They are unlike traditional operating contracts in that they are subject to shared deadlines in unique situations. As the complexity of these unique projects increases, the relationships between parties become more important.[4] This requires contract management software, or contract risk management software (CRMS), to become more dynamic and responsive.

The terms of these capex contracts necessarily involve assumptions at the start of the process, and are likely to change over the lifetime of the project lifecycle. For this reason, CRMS must be capable of recording one single instance of agreed changes to contract terms, and incorporating these changes in an auditable and legally robust way. With multiple decision makers involved, CRMS should also make accountability more transparent and enable faster decisions about variation proposals.[5]

References

  1. 1 2 "What is contract management software? - Definition from WhatIs.com". SearchFinancialApplications.
  2. ↑ "The Best Contract Management Software of 2015". PCMAG.
  3. ↑ http://info.8over8.com/hubfs/WhitePapers/8over8-Whitepaper-Contract-Management-Capital-Expenditure_2016.pdf
  4. ↑ http://www.apmg-international.com/nmsruntime/saveasdialog.aspx?lID=8156&sID=12573
  5. ↑ http://info.8over8.com/hubfs/WhitePapers/8over8-Whitepaper-Contract-Management-Capital-Expenditure_2016.pdf
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