Why Should Your Organization Embrace Smart Contract Lifecycle Management

In a globalized world, it has become more important than ever for companies to adopt smart procurement practices. These practices ensure that your procurement occurs quickly and transparently and you can keep track of the contracts. 

Smart contract lifecycle management (CLM) not only helps you keep a track of your contracts but also helps your organization embrace digital transformation. Today, smart contracts use blockchain, which is a secure and decentralized database that stores and maintains records of every transaction pertaining to the contracts. 

If you are wondering why your organization should transition to smart contract lifecycle management, here are some compelling reasons:

Smart contracts make use of blockchain and that ensures that every transaction is transparent. You can verify every detail of the contract and no changes or alterations can be made without authorization. Hence, this ensures the contracts become a legally binding document that is completely secure. Your vendor will have to comply with the terms and conditions as they will be clearly listed. 

When it comes to automated CLM, many organizations are always worried about security as contracts contain a lot of sensitive information. Unlike contract lifecycle management Excel, automated CLM uses one of the most secure technologies – blockchain.  The moment you approve a transaction, it gets encrypted. At the same time, the concerned parties can access the information. Everything has to be agreed upon before it can be entered into the smart contract. Once parties concur, no changes or modifications can be made nor can you delete the contract. 

With smart contracts and CLM, you utilize your resources more prudently. Rather than your procurement department spending hours to manually prepare and vet contracts, automated CLM ensures that the entire process from start to finish is automated. This not only reduces operational costs but also makes procurement more cost-effective. In addition, your staff becomes more productive as they are not spending time creating and getting approval for contracts. 

When you use outdated methods to prepare contracts, it is challenging to find the origin of an item. With automated and smart CLM, every single activity is recorded. You create audit trails that help to find anything quickly and efficiently. Whether you are seeking authorization for the negotiation with a vendor or you want to check the supply chain, smart CLM enables you to do that effortlessly. This helps you with compliance and also allows you to create the compliance report within no time. 

Smart contract lifecycle management allows you to automate the entire lifecycle and this does away with errors and mistakes. It allows your procurement staff to focus on their core responsibilities rather than spending all their time on creating or finding contracts. Every task within a smart contract has an owner, who is responsible for ensuring that the task is done on time. 

Report this Page