In the previous blogs we have already extensively discussed what a contract management system is and which processes are involved. It goes without saying that this automated system offers numerous advantages. Nevertheless, we want to take you into a deeper approach to these benefits so that you understand them well in order to make an informed choice in such a system.

I would like to highlight for you 5 advantages that are mainly aimed at organizations that want to implement contract management at a professional level and moreover want to distinguish themselves in this area.

Standard contract management processes and procedures

With a contract management system it is possible to easily standardize your processes. You get a grip on purchasing outside of the contract and partly because of this you reduce your purchasing risks. These insights give you control over the number of suppliers, which will automatically result in higher order volumes and therefore higher discounts.

As a result, savings will be made on the entire purchasing process. This will not only be noticeable on paper, but certainly also in practice. This is because it is easy and efficient to check whether the savings that were agreed upon when the contract was concluded are actually being applied. This often turns out not to be the case in practice.

The system is especially beneficial because you can, among other things, standardize your contracts and the contracting process. That means working out, implementing and adjusting a good process once.

Save significantly on FTE’S

Contract management systems ensure that time-consuming actions and manual processes are taken off your hands. Examples of frequently occurring manual processes are:

  • Tracking your contracts
  • Investigate whether contracts are fully utilized
  • Reminders on extensions
  • Manually sign paper documents

Performing these tasks manually takes a lot of valuable time. The savings that an automated process yields means that you, as a purchasing manager, can increase the workload per FTE.

You will be surprised if you have standard templates and clauses available. The entire approval flow is handled automatically and the legal department only needs to make adjustments for a specific category or service. This triples the speed at which you can contract.

Because you build up an easy-to-search document file with the contract. And even if your performance measurements are stored there, you will not lose valuable time on endless searches for the correct information.

You will be amazed when you consider how much time is wasted looking for the person who signed. Or do you remember your frustration trying to retrieve documents from one of the many desk drawers or filing cabinets?

Several independent studies have shown that at least 10% of contracts in organizations are simply lost. With a contract management system, the contract is always a few mouse clicks away from you.

Insight into the obligations

Perhaps the most valuable benefit of a contract management system with a central contract library is the insight into your obligations. What part of your budget is tied up in contracts? This insight makes it easier to fulfill negotiated contracts. In addition, you will be given the opportunity to strictly and adequately record your contract conditions.


Via a contract management system you will receive automatic reminders for actions to be taken. This allows you to keep control of expiring contracts. You will never forget an extension or termination, provided the correct details and dates have been recorded, of course.

Determine purchasing risk

With a contract management system you can classify suppliers and the associated contracts. This allows you to quickly and easily identify your contracts with suppliers in, for example, risk areas as a result of natural disasters, political unrest or economic instability. This is crucial information for the development of your purchasing strategy and risk management.

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