A Quick Guide to Contract Lifecycle Management Best Practices

Transitioning your organization to a contract lifecycle management (CLM) system can be a great way to improve contract processes through automation. The benefits are clear: increased efficiency, higher productivity and reduced risk are just a few.

But transitioning to CLM is also a major undertaking that requires ample preparation. Any project of such a large scale can be difficult to navigate and, if executed improperly in this case, could mean the benefits go unrealized. While a best-in-class CLM vendor will be an active partner in the technical implementation, getting broad buy-in and adoption within the organization takes careful planning.

To help you prepare for the transition to CLM, from ideation through adoption, we have distilled the experiences of hundreds of organizations into eight best practices, and divided them into two categories: planning and implementation.

Read on for eight steps to prepare for the deployment and ongoing use of an enterprise-wide contract management system.


1. Identify current processes and visualize the future state 

It’s true that CLM can dramatically improve business processes. But before it does, you’ll need to map out your current processes and develop a clear understanding of the current state of your organization’s workflow. With this map in hand you can more effectively identify gaps and inefficiencies in workflows. Armed with that knowledge, you’ll be able to define what the future state should look like and how CLM will benefit your organization.

2. Define project success

It can be easy to get caught up in the excitement of automating processes. However, defining project success at the outset is an essential best practice when rolling out CLM. Clear metrics are key to demonstrating ROI and can eventually serve as the basis for expanding CLM to other areas of the business. Defining and detailing the ideal future state can also help energize the executive team when it comes time to get their buy-in.

Project success metrics can vary depending on what your organization values, and what pain points you’re trying to overcome. Some examples of KPIs to measure include:

  • Implementation budget and timeline. These metrics are most helpful for measuring the specific success of rolling out CLM. Keeping it on time and on budget is invaluable for reinforcing the value of CLM.
  • Speed improvements. Tracking contract generation, iteration and time to signature before and after implementing CLM are all easy ways to demonstrate project success.
  • Revenue. It’s a very simple point, but it can often be overlooked: the project’s ROI depends on the implementation generating more revenue than it costs. Tying hours to dollars will help you demonstrate the baseline savings CLM can generate.
  • Risk. Automated contract generation and negotiation removes many opportunities for human error. Comparing historical data on costly mistakes from improperly drafted contracts can help quantify the reduction in risk. 

3. Start small 

After you have mapped out your organization’s current state processes and defined project success, it may be tempting to try to solve every problem you see all at once. However, changing too much too fast in your implementation could put adoption at risk.

Instead, identify one or two high impact, low risk use cases to prioritize. Start your implementation plan with that more narrow use case and identify its KPIs.

Implementation of a single use case will also make organizational adoption and empowerment more attainable. Instead of re-learning multiple business processes all at once, employees will have a manageable introduction to CLM. Once success is demonstrated, expanding CLM to additional use cases will be much easier.

Consider getting started with Docusign CLM Essentials, a solution specifically built for growing companies that are looking for their first contract lifecycle management solution.

4. Get buy-in at the executive level

You have a clear understanding of the current state and a well defined future state. You have defined project success and identified KPIs. You have identified a low risk, high reward use case to start with. Now it’s time to approach the executive team to get their buy-in.

Sometimes it’s a good idea to beg forgiveness instead of asking for permission. This is not one of those times. Having executive buy-in before implementation is vital for the success of a CLM system.

To do this, start with a clear and quantifiable business case for CLM. You must also be consistent in your messaging across the executive team. Inconsistent messaging can lead to different executives making incompatible assumptions and could stall or even extinguish the program before it can begin.

Once there is alignment among the executive team, budget and training time considerations are more easily navigated. This buy-in also trickles down throughout the organization, making organization-wide adoption faster and more thorough, and more likely to stick. 


5. Establish governance

After you get executive buy-in but before you begin implementation, designate an internal team to oversee the implementation and ongoing execution of CLM. This team will serve as internal experts and bridge the knowledge gap between your organization and your CLM vendor. The best practice for establishing this team is to select members from different areas of the organization. With a diverse leadership team, top-level alignment on rules and processes will be more robust, making organizational alignment more easily attainable. 

6. Empower and train your team

If you are the one driving the adoption of CLM, you may feel very well versed in how to use it on day one of implementation. However, for nearly everyone else in your organization, day one will be their first exposure to this tool. That is why it is very important to have a plan to train each employee on how to use CLM in the specific context of their role. Producing documentation and facilitating communication with the internal support team will help with enablement and foster quicker and more proficient adoption. 

7. Prioritize and migrate contracts 

CLM is not just for new agreements. To get the most out of the system, it’s important to migrate your existing paper contracts. This can be a daunting process, but the right CLM vendor will help you create a digitization plan.

A digitization plan usually starts by identifying where your documents are physically stored. Then, you will prioritize which categories of documents to digitize. It is generally the best practice to start with active contracts and any documents required for compliance. Once these are migrated, you should migrate any inactive contracts. It may not seem necessary to migrate inactive contracts, but the right CLM will make the data contained in them searchable and quickly retrievable. 

8. Test robustly

Adoption and use is not the end of the CLM implementation project. Your team of internal CLM experts should analyze and test the system robustly to ensure optimal use. Even though an automated system like CLM provides immediate and observable benefits over a paper system, there are always opportunities for process improvement.

If improvement opportunities are found through testing, your team of experts can reconfigure the system based on those learnings. And then the process starts again: they should continue testing to ensure that the reconfiguration had the intended effect.

Rigorous, ongoing testing will ultimately reduce risk by identifying and addressing problem areas. It will also cut down roll-out time for new use cases. 

Apply these best practices

These eight steps will provide you with a solid foundation to effectively plan and implement a roll-out of a CLM system. By taking a careful, methodical approach to planning and implementation, you will be able to establish CLM at your organization that improves processes and saves time and money.

Want more information about how CLM can dramatically improve your organization’s contract processes? Learn more about how Docusign CLM works and how to build a business case for CLM.

Austin Miller
CLM Expert