Phases of the Contract Lifecycle
The contract lifecycle extends beyond negotiating and executing contracts — whether it is for vendors, partners, customers, or employees. Most attorneys understand the importance of looking beyond the initial stages of a contract; however, without a mechanism or processes in place to manage the lifecycle from start to finish, the risk of missing a contractual obligation or opportunity goes up.
The contract lifecycle can be divided into five key steps, as follows:
- Drafting and Negotiating. In this phase, the parties may go back and forth several times until the language of the agreement and its terms are satisfactory to both sides.
- Approval and Execution. While all contracts used to be signed by hand, today electronic workflows and digital signatures mean more and more contracts are executed electronically.
- Managing and Tracking. Regardless of how a contract is executed, it is critical that key dates, deliverables, and financial obligations be tracked and monitored. If this step is missed, parties may find themselves surprised by missed renewal dates, automatic expirations, or missed contract options.
- Amendments. Over time, the parties’ needs may change. When contracts are renewed or amended to reflect changed needs or wishes, those amended documents should be maintained with the original contract documents, and corresponding obligations tracked.
- Analysis, Audit, and Reporting. It’s important to audit individual contracts from time to time to ensure obligations are being met (and benefits received). In addition, your entire “book” of contracts should be analyzed periodically to identify potential risks or opportunities. For example, analyzing your contracts can help identify disparities between the same provisions in different contracts. This can give you the opportunity to propose amendments to standardize the language in your contracts where possible, helping to lower your risks and streamline your obligations. You should also be able to generate reports at any time to help you manage your contractual obligations and rights.
When you outsource contract analysis to the experienced legal professionals at Baer Reed, you can be confident your contracts and agreements are in skilled hands. To learn more about how we help law firms and corporate legal departments with their contract lifecycle needs, contact us online today, or call us at (888) 433-1990.
- On October 16, 2017
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