Tracking changes, or more commonly known as “redlining”, is a step within contract lifecycle management that refers to the editing of contract terms. Tracking changes often times requires several individuals and/or legal teams to comment on, review, and make suggestions or adjustments to the most current iteration of contract terms. The redlining step is widely accepted as the most time-consuming stage within a contract’s lifecycle, as this stage can take several months or years to complete. This is because organizations typically require the input from several departments and parties during the contract review. During the redlining step, several phases occur as the document is edited in rounds, where various parties take the document, edit it, then pass it to the other parties multiple times as the document undergoes several revisions.
Managing contract lifecycles should be quick, accurate, and client-focused. However, redlining can be an extensive and lengthy process. By optimizing how your organization tracks changes to contracts, you can improve your overall contracting operations and ensure that contracts are accurately and speedily reviewed – allowing for the best possible client experience. In this manner, you set your business up for success by creating a way to complete transactions faster.
By having the appropriate software features within your contract management system, your organization can develop a faster method of contract review that facilitates tracking changes and redlining in a thorough and efficient way. In the previous manual form of contract review, making changes and tracking them proved to be both unorganized and highly risk-prone. However, with electronic contract management, you have a digitized contract review method that allows documents to be edited amongst many people in a centralized platform that keeps tabs on all versions of the document.
3 Key Software Features That Make Tracking Changes Effortless
1. Centralization of Editing Tools
Many organizations store contracts within shared drives. However, this presents a couple of problems. When a contract undergoes its review, whoever reviews the document has to locate the document in the shared drive, open the document, edit it, and then save a new draft once the editing has been completed.
What’s the problem here though?
The main issue in this scenario is that if two contributors in the review process of the same document accidentally make changes to the file at the same time, someone’s changes will invariably be overwritten or lost entirely. This can create significant roadblocks, miscommunications, and bottlenecks during the contract review process.
The good news is that this can be avoided entirely.
Contract management software helps with tracking changes in different iterations and versions of contract drafts. With a contract management platform, you have a centralized and highly secure place where multiple contributors can work together on the same draft, rather than edit several drafts of the document. This mitigates risk by preventing document overwrites and loss of changes. Additionally, this method saves time spent locating different drafted versions of the document. Certain software solutions offer the option to assign roles and user permissions for specific individuals that work on the document. In this way, the contract manager can effectively select who reads or edits particular document drafts for an extra layer of security.
2. Version Control
The worst possible way to oversee the contract review process is by managing all drafts in a single back-and-forth email chain amongst contributors.
Because when your organization’s legal team sends a starting draft to a contract administrator, the administer then sends the draft to other pertinent stakeholders (i.e., procurement and leadership). Then, each team will conduct an independent review of the document at hand, add comments or suggest changes to the document, and then email the new draft to the contract administrator. Finally, the contract administrator will take into account all of the suggestions and implement them into a draft.
This entire system is flawed because the contract administrator is solely responsible for taking suggestions and feedback from several different drafts and applying them into one draft. In this manner, the potential for minor mistakes, miscommunication, and disorganization is exacerbated.
Also – it’s incredibly time-consuming when it really doesn’t have to be.
With a dedicated contract management software solution, version control streamlines this process by giving several contributors the ability to review one document at the same time. This allows contributors to edit the same draft, where version control automatically tracks and combines each contributor’s changes within the same document. With version control, you can ensure that each contributor is working on the most current draft while expediting the review process and preventing against editing and change tracking discrepancies.
3. Audit Trails
Accurately monitoring who made a specific change to a document is incredibly important, especially when multiple people are reviewing the same document. This is because maintaining general visibility and transparency over the contract management process at large can provide increased insights regarding which stakeholders or departments suggested specific edits.
With a centralized contract management system, your employees’ actions are carefully monitored and tracked with audit trails, recording and time-stamping actions that take place during the contract review process. Audit trails present both business owners and contract managers with information pertaining to who edited a contract draft most recently with the associated timestamps.
In manual contract management systems, the contract review process is severely outdated, inefficient, and time-consuming. Not to mention, redlining and tracking changes is inherently risky in this method. In modern-day contract management, you have adjust your organization to maintain competitiveness – and this means optimizing contract reviews in whatever way possible. Contract management software makes contract reviews productive and results-driven.
Today, you can give your business effective contract review tools so you can track changes efficiently and effectively. Here at Dock, we are experts in SharePoint and Office 365 and want to help business utilize their features to revolutionize and streamline contract management. Our Contract Management System is equipped with several amazing features that will help improve the quality of your contract management processes with the help of a SharePoint and Office 365-based collaborative software interface. Improve business dealings, increase contract compliance, reduce bottlenecks and turnaround times, enhance risk mitigation efforts, and completely overhaul contract management team productivity for the better with our contract management software.
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Written by Lindsey Paulk
Lindsey Paulk is a Content Writer in Jacksonville, Florida that specializes in digitally communicating all-things contract management.