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Biggest Problems Facing SMBs in Contract Management

contracts are both opportunity and challenge for SMBs

Here are some of the most common problems faced by SMBs when considering their contract management landscape and understanding their obligations to Customers, Employees and Suppliers.

Limited Resources

SMBs typically have fewer personnel and financial resources compared to larger enterprises, making it difficult to dedicate resources solely to contract management activities. Most don’t have a dedicated compliance or contact management team.

Manual Processes

Many SMBs still rely on manual processes for creating, storing, and managing contracts, which are time-consuming and prone to errors.

Compliance Risks

SMBs may struggle to keep up with evolving regulatory requirements and compliance standards, leading to potential legal risks if contracts are not managed properly.

Lack of Visibility

Without dedicated contract management systems, SMBs may lack visibility into their contract portfolios, making it challenging to track key dates, obligations, and performance metrics. Budgeting can become increasingly difficult as the number of agreements increases along with organizational growth.

Collaboration Challenges

Collaboration among stakeholders involved in the contract lifecycle, such as legal, sales, and finance teams, can be cumbersome without proper tools and processes in place. This problem is even more challenging without tools designed to facilitate communication and unify the treatment of contract analysis and document storage.

Contract Variability

SMBs often deal with a wide range of contract types and formats, leading to complexity in managing diverse contract terms and conditions. Most don’t have a unified process for storing, analyzing and understanding large documents full of legal terms and jargon.

Security Concerns

Storing contracts in disparate locations or using insecure methods increases the risk of data breaches or unauthorized access to sensitive contract information.

The Solution

The first step to addressing these concerns in your SMB is to recognize that you have a problem and make a commitment to begin the journey to solve this problem over time. From our point of view, the obvious answer is an AI contract management and summarization tool like Contract Sage.

Implementing a contract management system tailored to the needs of SMBs like Contract Sage can effectively address the challenges SMBs face in contract management.

First, our system streamlines and automates manual processes, significantly reducing the time and effort required to understand, store, and manage contracts. By digitizing contract documents and centralizing communication workflows, SMBs can eliminate manual errors, ensure consistency in contract understanding, and enhance the business’ ability to take advantage of contract terms and nuances – ethically, or course.

Secondly, a contract management system provides centralized visibility into contract portfolios, enabling SMBs to track key dates, obligations, and performance requirements more effectively. With intelligent, AI-generated summaries, stakeholders can quickly access real-time insights into contract status, upcoming renewals, and potential risks. This enhanced visibility eases the burden of decision-making, enabling SMBs to proactively manage contracts, mitigate risks, and seize opportunities for cost savings and revenue generation.

Lastly, a contract management system like Contract Sage facilitates seamless collaboration among stakeholders involved in managing contracts. Through improved understanding of the landscape of obligations, SMBs can improve communication and coordination across departments, ensuring that all parties are aligned on contract terms and deadlines.

Overall, by leveraging a contract management system, SMBs can enhance efficiency, reduce risks, and optimize the management of their contract portfolios.