Effective and detailed contract management process for businesses

In business activities, businesses have many transactions and contracts that arise. That's why contract management sometimes becomes a difficult problem, requiring a lot of attention and resources to implement. So how to build an effective contract management process? Let's find out with 1C Vietnam in the article below!

1. What is contract management?

Contract management is the activity of recording, arranging, and storing contracts so that they are not lost or damaged. In addition, contract management also helps users look up content, ensuring contract implementation is consistent with the original agreement and signing. Thereby, disputes and damages arising can be limited.

2. The importance of contract management for businesses

Contract management is important to businesses, directly affecting profits and success. Specifically:

• Optimize resources: An effective contract management process will help businesses optimize resources such as equipment, human resources, materials,... to reduce waste and optimize costs.
• Ensuring legal compliance: Enterprises have an obligation to comply with legal regulations related to contracts in commercial transactions. If the contract management process is not carried out strictly, it can lead to legal problems and loss of compensation.
• Building and maintaining relationships with partners: Contract management can help businesses maintain business reputation, thereby building and maintaining optimal relationships with partners to create value. Castle.
• Ensuring product and service quality: Detailed contract management ensures that the products and services the business provides can meet agreed quality standards, which helps maintain reputation of the company.
• Coping with risks: Through the contract management process, businesses can identify risks that may occur in transactions. From there, assessments, analyzes as well as contingency plans can be made to deal with the worst situations.

3. How to build an effective contract management process

Each business will have a different way of managing contracts. Small and medium-sized companies can manage contracts with Excel, while large businesses need a more professional support software. However, no matter how contract management is done, the normal process includes the following steps:

3.1 Step 1: Draft and sign the contract

The first step in the contract management process is to develop and sign the contract. In this step, businesses need to pay attention to important factors such as: contract value, contract code, signing time, serial number on the contract file and appendix (if any). After fully drafting the necessary content and receiving the consent of the parties, it will be signed. The signing process needs to be carried out accurately, quickly and under the supervision of relevant parties.

3.2 Step 2: Classify and store all types of contracts and related documents

After the contract is signed, it will be classified for preservation and storage. Classification will help limit the risk of loss and the later search process will save more time. Businesses can choose to store contracts manually or store them on electronic software. Nowadays, software storage is more popular because of its ability to save space, cost and labor.

3.3 Step 3: Manage additional contract information

After signing the contract, if there are changes during implementation, the parties involved are obliged to report to the other party. Once the change is approved, the terms in the contract will be replaced. If one of the parties does not agree, the contract will remain intact to ensure benefits according to the original agreement.

3.4 Step 4: Report on contract implementation status

Relevant parties need to regularly update the contract implementation progress to ensure the implementation process is in accordance with the original agreement. During the monitoring process, if there are any errors, relevant parties need to be responsible for handling and correcting them promptly.

3.5 Step 5: Contract extension

Before extending the contract, the parties need to re-evaluate the entire contract implementation process. From there, make a decision to terminate or continue to extend when the contract expires.

3.6 Step 6: Finish contract implementation

After the contract expires, businesses need to ensure the conditions for termination and full payment of invoices. Contract acceptance is also a way for businesses to improve the quality of the contract management process in the future. Finally, archive the contract in accordance with the law.

4. Manage contracts effectively with Office software 1C:Document Management

Creating an effective contract management process is not simple. Furthermore, if following traditional storage methods, businesses can incur relatively large costs in terms of human resources, material resources and storage area. If businesses are wondering how to manage contracts effectively while still saving costs, they can refer to 1C:Document Management - A powerful, comprehensive digital office solution with superior functions. helps businesses operate smoothly and grow sustainably.

1C:Document Management solution is built on the 1C:Enterprise low-code platform, helping to automate the contract management process with maximum data security. In addition, the software also brings many benefits in the contract management process such as:

• Record and store contracts, receipts or business legal documents on the same platform.
• Manage contracts according to each project, each field of activity and other contract attributes.
• Manage the validity period of the contract, allowing automatic renewal when the contract ends.
• Circulate contracts according to the correct process, allowing department heads or board of directors to approve.
• Flexibly edit contracts, allowing you to compare differences between contracts (before and after editing).
• Save detailed contract editing history.
• Link contracts with many other types of documents.
• Decentralize access rights for each type of contract, absolutely secure information.
• Integrate contracts with many types of printers, scanners and other devices.

Contract management is an important activity in the company's operations. To be professional and automate the process, businesses should apply management software such as 1C:Document Management with specialized contract management features. If you have any questions about the software, or need support or advice, please contact 1C Vietnam for resolution.