Contract Management Trends 2022 – Contracts In The Age of Virtual Economies!

Contracts are essential to the operation of any business as they are the foundation of every relationship it has with its stakeholders, such as suppliers, partners, and customers. Contract Management Trends 2022 will be about rapidly evolving CLM processes to meet growing consumer demands such as automated CLM processes, compliance and risk management, smarter data management, etc.

The global legal tech software (mostly focused on AI & Machine Learning) market is estimated to reach $0.95 billion in 2025 at a CAGR of 26.6%.

– Legal Software Global Market Report – Business Wire

Let’s look at the key trends expected to transform Contract Lifecycle Management in 2022:

Industry-Specific Models for Contract Management

Different industries have unique clauses, terms of the agreement, etc., included in the contracts. Industries across various domains are now focusing on specific contract management models that can cater to their special requirements and are flexible enough to accommodate changes in the future.

For example, a sales document for a manufacturing company will have different terms and values than a sales document for a pharmaceutical company. Thus, defining specific models of contract management is necessary. The different models can be created based on:

Integration With Collaboration Platforms – Google Docs & Office 365

Integration with popular business process platforms like Office 365 and Google Docs will focus on contract management teams in 2022. The main advantage of integrating these platforms is their seamless interoperability with contract management tools. Creating and updating contract documents with Google Docs and using its specific features like Find and replace, smart document updation, etc., will ease team document management.

Similarly, integrating with Office 365 will allow contract managers to leverage features like smart search and document collaboration across platforms. Other advantages of integration include:

Contracts Incentives & Channel Management Will Drive B2B Commerce

The sale of a product rarely occurs directly between the business (product owner) and a customer. They mostly take place through channel partners and middle vendors of the supply chain. Thus, maintaining a stable relationship with high-performing channel partners becomes important. Focusing on seamless management of partner-driven contracts related to sales incentives, marketing incentives, or revenue sharing will be the main priority in 2022. Other areas which will be in focus will include:

Deeper Adoption of CLM Beyond Legal Teams With Self-Service, BU Portals & Departmental Contract Management

Gone are the days when managing contracts was mainly a legal task, and only legal carried the needful. Contract Management advancements like Self-Service CLM, Business User Portals & Departmental Contract Management have enabled the democratization of contracts, giving executive powers to other non-legal teams.

They enable pre-approved contract templates, e-signature, automated workflows, etc., enabling professionals from sales, procurement, or HR teams to manage contracts without consulting the legal teams.

On-Demand Collaboration Workspaces for Vendor Management

Vendor management is an important part of the contract management process. Vendor contracts can range from simple NDAs to important supply or sales-related contracts. The main focus of the contract management teams is on exposing contracts to vendors and enabling easy collaboration for them. This leads to effective negotiation and quick processing of contracts.

Other advantages of enabling on-demand workspaces of vendors are:

Sustainability With Contract Management Will Be A Priority

Today’s legal departments attempt to adapt to the changing landscape while still contributing to long-term contract management processes. Three SDGs are met by the move from paper papers to online paperwork: SDG 13 (Climate Action), SDG 15 (Life on Earth), and SDG 12 (Inclusion) (Responsible consumption and production).

Switching to paperless processes, contract work automation, smart compliance, etc., has become a priority for conscious businesses around the globe, most of whom are demanding vendors and partners to be sustainable and socially responsible.

Going Beyond Contract Lifecycle Management Towards Contract Process Automation

Businesses around the globe are focusing on facilities like seamless contract formatting, automated change detection, automated workflows, and more for their CLM processes. This is why Contract work automation is prioritized for managing the contract lifecycle from requests to renewals.

Contracts process automation extends beyond core contract lifecycle management processes supporting related processes such as renewal, amendment, claims, etc.

Enabling Channel & Supplier Communities

Nurturing communities of channel partners and suppliers can go a long way in sustaining business for firms. To induce the formation of communities, businesses can start supplier and channel partner programs. These communities can be used for product launches, enabling support, or giving the latest updates. Other ways in which channel partners and suppliers communities can be effective are:

Enabling Digital Payments & Wallets

The past two years have especially been detrimental to most businesses, but it has also facilitated digital payment processes. Digital payments and wallets are being incorporated in Contract Management processes by automating the payment processes like from distributor to retailer’s wallet and vice-versa.

Payment collection is also integrated into contract negotiation, invoicing, and accounting operations, allowing consumers to pay promptly and avoid delays and nonpayment risks.

The way we work and run our businesses has changed dramatically in the last two years. Still, it has also helped firms worldwide develop and mature by enhancing adaptability, innovation, and tenacity. It should be safe to estimate that: