Automating contract review and approval process: a guide to efficiency
Your contract process is like a flip phone in a smartphone world. Functional? Sure. Efficient? Not so much. Sure, there’s a certain charm to the painstaking effort it takes to piece everything together, but let’s face it—those days are long gone. Why stick to slow, manual workflows when you could have one-click approvals, AI-powered insights, and seamless collaboration? It’s time to upgrade your process from VHS to streaming, leaving behind the rewinds and skips for smooth, uninterrupted progress. Your team deserves a smarter, faster way to get things done, and the future of contracts is already here. Let’s break it down, step by step.
Benefits of automating contract review and approval
Contract automation can revolutionize your organization's efficiency and bottom line. Recent industry research shows businesses that adopt intelligent contract management tools reduce their contract-related costs by up to 60%. These tools also speed up negotiation cycles by 50%.
Your business will gain these key benefits through automated contract review:
Enhanced accuracy and compliance: automated systems apply predefined rules to all contracts. This reduces variations and errors while ensuring compliance with internal policies
Up-to-the-minute visibility: you get instant access to contract statuses that help monitor progress and spot bottlenecks
Better collaboration: multiple stakeholders can work on contracts together with live change tracking
Automated alerts: the system sends notifications about critical contract milestones, renewal dates, and compliance deadlines
Centralized management: a single repository houses all contracts and associated data, which eliminates departmental silos
AI-powered review capabilities cut your legal team's manual effort by half. This allows them to focus on strategic initiatives instead of routine tasks. Automated workflows route contracts to appropriate stakeholders automatically. Manual follow-ups become unnecessary, and bottlenecks decrease.
Key steps to implement contract automation
Contract automation implementation needs a strategic approach that focuses on people, processes, and technology. Research shows that about 50-70% of employees are skeptical about new systems at first. The success depends on proper implementation.
Selecting the right automation tools
The right contract automation software must line up with your organization's needs. Look for platforms that connect smoothly with your existing CRM and ERP systems. Your ideal solution should include AI-powered contract analysis features that extract key information, spot potential risks, and highlight compliance issues.
Budget-friendly tools with customizable workflows can grow with your business needs. A good platform provides detailed analytics to track performance metrics and find process improvements. Easy-to-use interfaces and strong security features ensure successful implementation across your organization.
The right contract automation solution delivers measurable improvements in processing times, fewer errors, and cost savings. Modern contract management platforms streamline operations while maintaining high standards of accuracy and compliance.
Choose Enty as your go-to partner for contract management and much more. Enty provides a seamless platform for creating, reviewing, and approving contracts with powerful automation tools. But that’s not it - with its all-in-one functionality, Enty also helps you handle invoices, streamline payments, and manage corporate documents, all this - to make the process of managing your business easier. It's an adaptable solution designed for businesses seeking efficiency and accuracy in their back-office workflows.
Training staff and managing change
Your team needs specific skills to develop. Create complete training materials with interactive modules, step-by-step guides, and video tutorials. The new system will streamline daily workflows, which helps gain employee support. Training sessions should happen in phases. This approach lets your team learn gradually and build confidence with the new contract review process.
Establishing implementation timelines
A phased implementation schedule allows proper testing and adjustment. Your timeline should include these key milestones:
Original system configuration and testing
Pilot program with a small team
Department-wide training sessions
Full system deployment
Post-implementation review
Key performance indicators for contract automation
Specific metrics help measure the success of your contract automation implementation. These KPIs allow businesses to track efficiency, pinpoint areas of improvement, and demonstrate ROI to stakeholders. Essential KPIs include:
Contract cycle time: measure the total time taken from contract initiation to final approval. This metric reveals process bottlenecks and identifies delays in the workflow.
Processing duration by priority level: analyze how quickly contracts of varying importance are reviewed and approved. High-priority contracts should move faster through the system than routine ones.
Contract change success ratio: track the percentage of successfully implemented changes versus those requiring additional corrections. This reflects the accuracy and effectiveness of the automation.
Review efficiency: measure the percentage of contracts reviewed without errors or needing rework, an indicator of the system's compliance with internal policies and standards.
Renewal rates and milestone compliance: assess how often renewals or milestones are handled within predefined timelines. Higher compliance rates signal a reliable, automated alert system.
Cost per contract processed: monitor the cost associated with processing each contract, comparing automated versus manual processes. Automation should drive significant cost savings over time.
Additionally, qualitative metrics such as user satisfaction scores and feedback on ease of use are crucial for understanding system performance beyond numbers.
Tracking time and cost savings
Time and cost metrics need systematic tracking from day one to measure automation's impact effectively. Document baseline metrics before automation, including average contract cycle time, approval delays, and errors due to manual handling. Post-implementation, compare these with updated metrics to assess performance improvements.
Cost reductions: studies show that contract automation can reduce contract management costs by up to 60%. These savings stem from decreased manual effort, fewer errors, and improved negotiation cycles.
Time savings: contracting cycles can be reduced by up to 50%, freeing teams to focus on strategic initiatives instead of routine tasks.
Labor hours: quantify labor hours saved per contract and calculate the monetary value of these efficiencies.
Operational bottlenecks: monitor where bottlenecks shift or decrease after automation implementation to ensure continuous improvement.
Regular monitoring identifies areas to optimize, and ROI reporting demonstrates the tangible benefits to stakeholders. For example, calculate cost savings by comparing historical data with current expenses for contract management. This data can help justify additional investments in software or training.
Lastly, open communication throughout the implementation process is essential. Gather user feedback to adjust workflows and improve training programs. This inclusive approach helps create an automated contract system that evolves with organizational needs and ensures high user adoption rates.
Features of effective contract review software
Understanding the vital features that streamline processes and accuracy is significant to select contract review software. Your organization can handle agreements better with sophisticated capabilities that modern contract management platforms provide.
Workflow customization options
Contract review software must provide flexible workflow configuration that adapts to your unique business processes. The best platforms let you create custom approval paths based on contract value, type, and complexity. You can set up conditional logic to route contracts that ensures the right stakeholders review documents at the right time. Dynamic templates adjust based on questionnaire responses and help maintain consistency while accommodating various contract scenarios.
Integration capabilities
The right contract review software naturally connects with your existing technology stack. Key integration features should include:
Native connectivity with CRM and ERP systems
Compatibility with e-signature platforms
Integration with document management systems
API access for custom connections
Cloud-based storage synchronization
These integrations allow automated data population across systems. Manual entry reduces and consistency improves throughout your contract lifecycle.
AI-powered review capabilities
Advanced contract review platforms utilize artificial intelligence to make the review process efficient. Natural Language Processing (NLP) helps the software understand and analyze legal language that automatically identifies potential risks and compliance issues. The software extracts key information like dates, payment terms, and obligations while it flags unusual or non-standard clauses.
Your organization's contract history and playbooks help AI systems learn and become more accurate over time. Legal documents transform into digestible contract abstracts within seconds with this technology. Legal teams can focus on strategic decisions rather than routine review tasks because AI identifies legal, compliance, and financial risks proactively.
A more efficient contract review process maintains accuracy while reducing manual effort with these core features. Customizable workflows, natural integrations, and AI-powered analysis are the foundations for efficient contract management.
Enty provides all these features and more, ensuring your contract workflows are efficient, customizable, and secure. With AI-powered review tools, seamless integrations, and a user-friendly interface, Enty simplifies every aspect of contract management.
Challenges and solutions in automating contract approval
Organizations face several implementation hurdles despite the many benefits of contract automation. A successful automation adoption depends on how well you understand these challenges and their solutions.
Setting up approval rules and conditions
Your organization's specific needs must guide the configuration of approval rules. Teams often struggle with:
Unclear condition definitions
Complex rule combinations
Integration with existing systems
Rule consistency issues
You can overcome these obstacles by documenting your current approval conditions and building a clear rule hierarchy. Configure automated workflows that respond to specific contract parameters such as value thresholds, risk levels, and contract types.
Defining roles and approval hierarchies
An effective approval hierarchy needs balance between control and efficiency. Your system should handle both parallel and serial approval workflows with clear accountability. A role-based matrix could work well.
Mapping current vs. desired approval processes
Workflow efficiency gaps often surface during the transition from current to desired processes. Document your existing approval steps and spot the bottlenecks first. A detailed map of your ideal process will help you create a phased transition plan that covers:
Process Progress Steps:
Document current workflows
Identify improvement opportunities
Design optimized processes
Test new workflows
Make gradual changes
Best practices for streamlining contract workflows
A strategic balance between efficiency and accuracy helps streamline contract workflows. You can optimize your contract review process and retain strong control mechanisms through proven best practices.
Continuous process improvement
An efficient contract review system depends on ongoing monitoring and improvements. A systematic approach to process optimization should include:
Regular Performance Analysis
Monitor key metrics monthly
Review bottlenecks and delays
Analyze user feedback
Assess automation effectiveness
Update workflows based on findings
The contract review process must adapt to your organization's changing needs. A feedback loop allows stakeholders to share their thoughts about workflow efficiency. This shared approach identifies improvement opportunities and ensures everyone's commitment.
A dedicated process improvement team should take responsibility for:
Monitoring system performance
Gathering user feedback
Implementing optimization strategies
Training users on new features
Documenting best practices
Using technology to streamline workflows
Technology plays a pivotal role in enhancing the efficiency of contract workflows. Automated tools eliminate repetitive manual tasks, improve data accuracy, and accelerate approval processes. Enty ensures smooth collaboration and effortless integration with your existing systems, providing a comprehensive solution to optimize your contract lifecycle.
Managing exceptions and special cases
Every well-laid-out contract review process needs flexibility for unique situations. A structured approach helps manage exceptions without disrupting standard workflows.
Exception Management Framework:
Define clear criteria for exceptions
Set up alternative approval paths for urgent requests
Document special handling procedures
Create escalation protocols for complex cases
Keep audit trails for all exceptions
The right balance between flexibility and control matters when handling special cases. Your system should handle urgent requests while ensuring proper oversight. A fast-track review process for time-sensitive contracts can help maintain compliance checks.
Smart workflow design includes:
Conditional routing based on contract parameters
Priority-based queue management
Clear escalation paths
Templates for common exceptions
Documented lessons from special cases
Note that exception handling procedures need regular reviews. Common exceptions might signal needed process improvements or new standard workflows. Data from exception handling helps refine the primary contract review process and automation rules.
The contract management system should support both standard workflows and exceptions through:
Flexible routing options
Configurable approval hierarchies
Up-to-the-minute status tracking
Automated notifications for stakeholders
Complete audit trails
This balanced approach to process improvement and exception handling creates a strong contract review system that adapts to business needs efficiently.
Regular system audits and updates
Your system's effectiveness needs constant attention. Set up regular audits to review approval workflows, rule configurations, and user permissions. System performance metrics and user feedback will point out areas that need improvement.
The contract review software must stay current with the latest features and security patches. Good maintenance will help your automation system meet growing business needs while following current regulations.
Your automation success depends on constant refinement. Watch your approval workflows and adjust rules based on performance data and user input. This step-by-step approach will optimize your contract review process while you retain control and efficiency.
Future trends in contract automation: what’s next?
As contract automation technology continues to evolve, several key trends are shaping the future of how businesses manage contracts. One significant area of growth is advanced AI integration. AI-powered tools are becoming more adept at analyzing complex contract language, identifying risks, and suggesting improvements in real-time. In the future, AI could take on more proactive roles, such as automatically negotiating contract terms based on predefined preferences and compliance requirements, or even predicting potential risks before they arise. This evolution of AI will enable businesses to handle contracts faster, with fewer errors, and in a more strategic manner.
Smart contracts are another emerging trend that’s set to revolutionize contract automation. These self-executing contracts are embedded with terms and conditions that automatically trigger actions once certain conditions are met. By automating the execution of agreements, smart contracts reduce the need for manual intervention, speeding up the process and ensuring greater accuracy.
Another area to watch is improved integration with other business systems. As contract automation platforms continue to develop, they will offer deeper connections with CRMs, ERPs, and other enterprise software. This seamless integration will allow for smoother workflows and more efficient data exchange between departments, ensuring that contract-related information is always up-to-date and accessible across the organization.
To stay ahead of the curve, businesses should start exploring these future innovations now. Embracing AI, smart contracts, and advanced integrations will help organizations drive efficiency, reduce risks, and maintain a competitive edge in the rapidly evolving business landscape.
Final thoughts
Contracts don’t have to be your team’s kryptonite. With automation, they become your superpower—a streamlined, efficient process that saves time, reduces errors, and improves compliance. The right tools don’t just transform workflows; they transform businesses. Whether it’s speeding up approvals, improving collaboration, or giving your team the freedom to focus on big-picture goals, automation is the key to unlocking your potential. The question isn’t if you should automate; it’s how soon can you start?
