Contracts are the foundation to revenue for a business. For salespeople, the speed at which they can get a contract signed can make or break whether they reach sales goals, like quota. This eBook showcases how Contract Lifecycle Management solutions can increase the value of a deal, help accurately predict the close of a contract, and shorten the sales cycle by automating each step of the contract process.
2. 2CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
Introduction
As the end of the quarter approaches, the pressure builds
for salespeople trying to reach their quarterly quota.
Working late nights and weekends can get only get a
sales rep so far when scrambling to close contracts in the
final weeks of the quarter. Contract delays, like drawn out
contract reviews or missing signatures can botch even the
best laid plans to close a last-minute deal.
Failure to reach quota can hurt more than just a business.
Salespeople can come under fire from management, miss
out on commission and start the next quarter with a low
morale.
A recent Aberdeen Group report found that just
48% of sales reps achieve quota at Industry Average
organizations. Clearly this issue is common in the sales
world, but it can also be seen as a major opportunity for
a company to speed up the contract cycle and increase
revenue.
No sales team intends to lose a deal, and it’s still going
to happen from time to time. The loss shouldn’t be due
to easily avoidable pitfalls like outmoded and outdated
contract management strategies. This eBook will equip
you with contract management best practices to help
you better spot contract red flags and deliver on your
forecasted pipeline when it matters most.
3. Table of Contents
Introduction.......................................................................2
End of the Quarter Scramble............................................4
Increasing Value with Effective Contract Management....6
What Stands Between You and
Your Quarterly Revenue Goals?........................................7
A Predictable Pipeline:
Automation to Anticipate Close......................................13
Start Closing the Quarter Now.......................................16
Contributors....................................................................17
4. 4CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
End of the Quarter Scramble
Ushering a deal to close is much like playing basketball;
you can’t wait until the final minutes of the game to score
enough points to win. Instead, if you consistently score
throughout the game you have a better chance of staying
ahead and winning. Unfortunately, sales teams find
themselves scrambling at the end of each quarter. It can
be a dangerous place to be, since rushing the process
can open the door to human error and risks.
In a SpringCM survey, over 70% said human error
negatively impacts their contract process at times, while
9% have received penalties for compliance errors in a
sales contract.
When a salesperson rushes to close a deal, it becomes
tempting to cut corners or accept other risks in order to
get that contract signed. At the same time salespeople
are dealing with unpredictable setbacks. For example, just
when all the approvals and signatures are thought to be
collected, you could suddenly learn that there are more
individuals from the customer side that still need to give
approval.
To ensure the still closes in these situations, some
sales reps add “out clauses” to a contract, allowing the
customer to get out of the deal if a pending approval
doesn’t go through. This might close the deal for the
5. 5CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
moment, but it leaves a major asterisk with the possibility
of the contract being terminated and never resulting in
revenue.
Rushing the deal can bring more than financial headaches
to your company, but also legal trouble. Without the
right tools, fast-tracking a contract through negotiations
can lead to human error. If a mistake happens and the
customer doesn’t get what they agreed on, they have
grounds to sue you. These extreme situations can cost a
salesperson their job.
Avoiding the end-of-the-quarter scramble starts
with establishing a predictable, repeatable contract
management process.
6. 6CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
Increasing Value with Effective
Contract Management
Contracts should be managed in a way that is organized
and transparent, keeping sales operations, sales
management and legal in the loop over the status of the
contract. The process must be thorough and secure but
also fast.
A successful contract management will accomplish the
following things:
• Increased Contract Accuracy & Compliance
• Shortened Review Cycles to Speed Time-to-Revenue
• Minimized At-Risk Revenue with Automated Renewal
• Improved Customer Experience
BlueCross BlueShield, established a standard contract management
process to onboard new and existing dentists to their program. The
contract processing time was reduced from 6 weeks to 1 week, and
the company was able to enter a new market in 6 months rather than
the projected 3 years.
7. 7CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
What Stands Between You and
Your Quarterly Revenue Goal?
The contract lifecycle is complex, and involves
collaboration between sales and legal teams. The key
is to build a predictable pipeline that tees up the next
step in the process while gaining visibility into potential
problems that can slow down the process.
There are 7 core stages to the contract lifecycle, and
each stage must involve open communication and
transparency. For each step, sales teams should
consider if their organizations contract process
matches these best practices, and if not, recognize
what could be standing in the way of realizing your
quarterly revenue goal:
Stage 1: Store
At the beginning of the contract process, the first step to
building a predictable pipeline is to establish a “source of
truth.” This is where the contract is stored and worked
upon. A central repository provides one location in the
cloud that everyone involved can access. With this,
a contract can be accessed from all devices, and all
changes to the document are synched, ensuring you’ll
always have an up to date version of the contract.
For sales teams using a CRM like Salesforce, a solution
should be integrated so reps don’t need to leave that
8. 8CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
platform to deal with the contract, but the contract
shouldn’t be bound to that CRM. At the same time, the
contract needs to be accessible to outside teams like
legal or finance.
Stage 2: Generate
The next stage is building the contract itself, which is
inherently time-consuming since it can involve re-keying
the same details for each contract.
The ability to automatically generate contracts from pre-
approved templates will eliminate repetitive tasks and
allow the salesperson to engage with the customer more
often.
Additionally, generating pre-approved legal language
will allow sales teams to get a jump-start to contract
negotiations, and add some legal language to the
contract themselves so the legal team can focus on the
more fluid details.
Stage 3: Negotiate
While sales teams have their eye on the clock and their
managers and customers in mind, legal is busy picking
apart the contract for potential risks. Both teams are
often at odds finding the balance in the quality of the
review and the speed at which it’s done.
Early on in this phase it’s important to communicate with
the legal team on how long it might take to redline the
9. 9CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
contract. Sales teams can then relay that information to
the customer so everyone is on the same page.
Sales teams still need visibility into the contract as it
is being redlined, so they’re not reaching out to Legal,
and distracting them from negotiations. If the contract is
being redlined in the cloud, sales teams can easily check
the status and identify who made what changes and
when, without needing to reach out to Legal.
Stage 4: Approve
Now that the contract language has been negotiated
and reviewed, it’s time to collect the appropriate
signatures. Depending on the size of the contract,
signatures will be needed from lawyers, executives and
other stakeholders. Here’s the next bottleneck: the clock
is ticking and you can’t find the necessary people to sign
the contract. In our survey, more than 43% said their
contract process stalls at the approval stage.
Whether they are on vacation, or just bad at keeping in
touch, getting the individuals to put a pen to paper can
look impossible at this point.
Instead of resorting to altering contract language or
writing an “out clause,” salespeople should be able to
get the contract signed, no matter where there signees
are. Electronic signatures can allow the contract to be
signed anywhere, anytime and from any device.
10. 10CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
Stage 5: Import & Administer
Once the contract has been approved, it’s a matter of
getting it to all the individuals involved in the deal. By
this stage, the company can begin to realize revenue
and both parties begin to follow through on obligations
in the agreement. It’s important this contract is stored
safely, but also made accessible to the parties involved,
so it can be easily referenced. That can be difficult and
time-consuming considering some individuals are just
entering the process now and did not previously have
access to the contract.
Scanning and emailing a contract can take time,
depending on the number of pages. On top of that,
you’re relying on that individual to take immediate action
if you want to move things along. Most companies store
contracts on shared drives, but it’s often not shared
between the company and the customer. There’s a
risk the two parties have two different versions of the
contract.
At this stage, you can map out where this contract
needs to go further down in the lifecycle. Upon
signature, contracts can automatically be routed to
the necessary party undertaking the next step in the
process.
Since a contract can be in this stage for some time,
and sales teams have other projects on their plate,
11. 11CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
automated reminders should be established throughout
the lifecycle of a contract. This will ensure all obligations
and deadlines within the contract are met.
Stage 6: Optimize
At this stage, sales teams can begin tying up loose ends
in the contract. Think of this stage as a performance
review for the contract: Did it contain any errors post-
signature? Is the customer completely clear and happy
with the terms?
This is where it’s useful to look into the contract process
to see what has been done, and by who. With one
version of the contract stored in a central repository,
every action on that document should be recorded
for auditing purposes. If there was a mistake made
somewhere, you’re provided a history of the contract
so you can identify the cause of the issue quickly.
Accountability and responsiveness sets a standard of
professionalism and honesty, something that can make
all the difference for customers.
Stage 7: Renew
Being the last stage of the cycle, it’s not uncommon
for sales teams to forget to circle back on contracts
for renewal. Having worked so hard already ushering a
deal through the process, it’s a shame to see renewals
fall through.
12. 12CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
Between all the other deals and customers, it’s easy to
lose track where your other contracts are at. The ability
to set an automatic reminder well ahead of a contract
renewal date can give salespeople enough time to
consider adjustments before the renewal is executed. It
can also alleviate the anxiety that you may have missed
something so you can rest assured that revenue will be
realized.
13. 13CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
A Predictable Pipeline: Automation
With an automated contract management solution,
repetitive and time-consuming contract processes can
become streamlined.
Automation offers key benefits that guide sales teams
through all stages of the contract process. This allows
sales teams to work through contracts faster while
looking ahead into the pipeline to see what’s next in the
contract lifecycle, anticipate possible bottlenecks and
predict the close of the deal.
14. 14CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
With automation, these benefits will simplify the sales
process:
Centralize Contracts:
A central, cloud-based location provides visibility and
accessibility for all parties in the contract process.
Having a central repository for contracts eliminates
the need to email changes to the contract during
the negotiation and approval states. This not only
streamlines communication between parties, but it
negates the risk of having multiple versions of a contract
being sent into the workflow.
At the same time, Sales and Legal can have access to
the same contract, allow the salesperson to check on
contract negotiations, without reaching out the Legal.
Going Paperless:
For almost two decades, electronic signatures have
been a completely legal way of doing business, however
companies have been slow to adopt this process. With
an electronic signature, you have record of the date and
time of signature, the individual verified through an email
account, and the intent of that agreement. This more
secure and transparent than putting ink to paper.
When it comes to keeping the contract process moving,
eSignature allows parties to sign a document through a
computer or mobile device, allowing parties to approve
15. 15CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
contracts while they are outside the office or in transit
while eliminating the need to track down individuals for a
physical signature.
Tracking & Notifications:
The ability to track the contract status keeps everyone
in the loop over what actions have been taken, what
still needs to be done, and who is responsible for those
actions. This is essential for building your predictable
pipeline and allows for sales teams to pinpoint delays
and better forecast the close of a deal.
If a contract is sitting idle, awaiting action from an
individual, that person can be notified to take action. It
increases accountability and compliance through the
entire contract process. Tracking features can create
an automatic audit trail, recording when an action was
taken and by whom.
16. 16CONTRACTS FOR CLOSERS; TURNING YOUR QUARTERLY FORECAST INTO REVENUE
Start Closing The Quarter Now
Sales teams want their customers to trust the company
they are dealing with. Establishing a business process
that is organized, transparent and secure will not only
deliver an accurate contract on time, but build a positive
reputation for the salesperson and the company.
With unpredictable roadblocks being inevitable in the
contract process, there are only so many things a sales
team can do to close contracts on time. A proactive
approach can line up the steps in the contract process
to make them easier and faster to check off.
Imagine not spending the final weeks of the quarter
or year scrambling to make phone calls to close
a lackluster contract. Instead, imagine accurately
predicting the close of your contracts from the start of
the contract process.
Get your ducks in a row now, and start forecasting a
panic-free close to the quarter.
17. SpringCM is a secure cloud platform that manages contracts and all types of documents
seamlessly across desktop, mobile and partner applications like Salesforce. We go beyond
standard contract and document management with advanced workflows that automate manual
tasks and complex processes to speed time-to-revenue. SpringCM makes it possible to optimize
collaboration and processes across Sales and Legal, as well as with prospects and customers.
180 North LaSalle Street, Sixth Floor, Chicago, IL 60601 | www.springcm.com
Request a demo
Speak with a contracts expert today!
Looking for a complete Contract Management
Solution? We know you’ll like what SpringCM has to
offer. We can help you collaborate around contracts,
increase visibility, and reduce risk.
Contributors:
Monica Peterson
Account Executive
SpringCM
Nick Zolfo
Business Development
Representative
SpringCM
Nick Oboikovitz
Account Executive
SpringCM
Allyson Clark
Team Lead, Client Services
Virsys12
Emily Burger
Attorney