The International Association of Contract and Commercial Management this week released a new study of contract management practices and performance, calling on the experience of more than 400 organisations, and the headline finding makes no bones – most businesses are their own worst enemy when it comes to contract management efficiency and effectiveness.
There is plenty of evidence to support the notion that companies are increasingly recognising the need to improve contract visibility and drive out risk, but nonetheless the Contract Management Software: Market Sizing and Status Report states that “contract management remains one of the most manual, under-systematized” and poorly defined areas of business operations.
IACCM President and CEO Tim Cummins writes; “In most business and public sector organisations, contract management remains one of the last undefined areas of activity. While there are certainly rules, policies, and authorities related to the form, content and creation of contracts — and there may even be resources operating with job titles like ‘contract manager,’ this does not represent a process with clear ownership or accountability for performance.”
But while contract management does seem to be one of the last bastions of best practice resistance, the report does at least make the point that where contract management software is adopted it is generally able to address these issues very effectively. IACCM found that organisations using contract management software reported measurable improvements with contracting and contract management controls, efficiency, and effectiveness, as well as benefits in workload reduction, risk management, innovation and cost and revenue improvements.
