CFO Perspective: The Value of Contract Lifecycle Management Technology
While contracting has historically been considered the realm of in-house counsel, more and more CFOs have started taking an active role in contract processing and analysis. That’s because contracts are the most important data source in a company. Not only do they represent financial commitments, the information in contracts also determines areas of risk, goals for growth, and financial projections.
With so much at stake today - like steep penalties for violating data privacy laws - CFOs, who are ultimately responsible for the fiscal health of their company, require direct, easy access to contract data. Contract lifecycle management systems, like Evisort, instantly turn your contracts into searchable data and automates end-to-end contract management. CFOs who use Evisort can recognize revenue quickly, streamline operations, and enforce compliance with regulatory requirements, while gaining greater visibility into their contract data.
Here are the top four ways that contract lifecycle management systems can help CFOs optimize performance.
1. Provide a single source of truth.
CFOs need a clear understanding of their company’s financial commitments and areas of risk. The more accessible and complete the data set is, the more valuable the insights. Often in companies, contracts are siloed by departments or geography. That’s why it’s so important to have an easily accessible single source of truth for all contracts.
The best intelligent CLM platforms can automatically sync all your organization’s existing agreements in a single, centralized repository, without migration or IT involvement. With the help of AI-powered technology that quickly and accurately scans thousands of documents, finance executives can have access to a fully indexed, searchable digital portfolio of their company’s commitments and exposures, mere hours after uploading them. Having this data at their fingertips helps finance executives make more accurate, data-driven financial decisions.
2. Offer insight into where your money is going.
Contracts dictate every dollar that flows in and out of a company. Gaining deeper, more holistic visibility into a company’s contracts allows CFOs to see, in real time, how much revenue is tied up and what cash flow projections look like. There’s a material difference, for instance between “pay on completion” vs a “progress” or “performance-based” contract terms. Having easy access to data on payment terms, rebates, and contract milestones helps CFOs strategically manage corporate finances and make changes based on their cash position.
3. Manage and mitigate risk.
According to a PwC impact survey, the primary concern of finance executives is how to manage financial impact, whether expected or otherwise. That requires visibility into agreements. As many CFOs learned during the pandemic, organizations that had CLM technology as part of their company practices, were able to mitigate risk faster, partly because they were able to quickly see what their obligations were, and then gain traction to emerge stronger. Intelligent CLM platforms, like Evisort, also provide safeguards by tracking regulatory and privacy obligations, streamlining compliance processes, and generating audit trails. CFOs can have faith in the review process; AI has been shown to be more reliable than human eyes when it comes to document review.
4. Build better business collaboration practices.
With the revolving nature of finance, transparency, accountability, and collaboration between departments are even more imperative to an effective business operation.
CLM platforms also support better business collaboration by providing automated workflows that give team members the right level of visibility for their role.
Ready to learn more about how Evisort’s contract intelligence capabilities can help provide visibility into contract data, reduce risk, and optimize performance? Schedule a demo today!
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