8 Contract Management Trends to Watch in 2025

Adapting to meet shifting consumer demands and keeping pace with today's digital marketplace requires an ongoing commitment to process improvement—of which contract lifecycle management is at the centre. As a result, the best practices of contract management are constantly evolving.

In 2024, the value of digital contract management shifted from a back-office conversation to a competitive advantage. Here are eight current trends in contract management that can't be ignored.

The top 8 trends in contract management

1. Accelerated digital transformation

Most businesses have stood on the precipice of a digital transformation for close to a decade, but COVID-19 forced organisations to take the leap and address the inefficiencies in their current contract management strategy head on. As tightening margins and office closures necessitate remote solutions to daily business operations, managers in every department are looking for new ways to digitise outdated document management processes.

For instance, many organisations adopted an electronic signature solution to ease the transition to remote work—and eliminate disruptive, paper-based contract management procedures. At first, it was just a stopgap solution to remote work. However, business leaders quickly realised that the benefits of bringing an organisation online extend far beyond a COVID response.

As Gartner's research indicates, "once a business process is converted from paper processes to digital workflows, it will become 'the new normal'—reflecting the next stage of the digital transformation." Now, across every department, COVID-19 is shaping process management strategy. Nearly 68% of legal departments, for example, now say "digitising manual processes" is a top priority, according to a study conducted by Paradoxes Inc. on behalf of Docusign.

2. The COVID response—the renewed value of business preparedness and continuity

Procurement teams often approach business continuity reactively. Responding to a crisis or adapting to remote work requires a strategic rather than tactical approach. In other words, one must have the right tools in the right places before disaster strikes to ensure business continuity.

Unfortunately, in 2020, many contract management professionals were caught off guard by how fast change needed to be implemented. Being able to quickly adapt or shift workflows without interrupting day-to-day business operations puts organisations in a position to effortlessly weather unforeseen challenges and high-change disruptions. Additionally, once a picture of the post-pandemic landscape becomes clear, a more flexible contract infrastructure will support scalability in any environment.

Overall, end-to-end contract management provides a simple way to improve business continuity. With a more nimble document management process, organisations eliminate slow-moving manual procedures—and clear the way for efficient policy updates, contingency hiring or other operational challenges. When you add cost reduction and relationship building to the list of potential benefits of updating your current document management strategy, the business case for contract lifecycle management becomes even more compelling.

3. End-to-end automation is driving contract management efficiency and quality

Traditional contract generation, negotiation and approval rely on hands-on governance to move contracts forward—which wastes time and introduces an opportunity for human error to disrupt the process. Automation means less risk, stronger regulatory compliance and greater efficiency.

One of the biggest pain points for organisations is the sheer volume of operational procedures that must be completed manually. According to a study conducted by Paradoxes, 46% of contract management professionals say an abundance of manual tasks make collaborating on contracts a challenge. Duplicate work, inaccurate data transfers and a lack of traceability are also all problems that multiply as your business scales. Therefore, the more complex your document workflows, the more your organisation can benefit from end-to-end automation.

For instance, an extensive client database can present challenges and a security risk for businesses that rely on the manual transfer of data during the contract generation process. Automated, end-to-end document management solutions allow for integration with existing Systems of Record—enabling error-free agreement generation at the click of a button by auto-filling documents with existing client or product information.

Lastly, automation creates standardised, configurable workflows at an enterprise level—which drives contract and process quality. When your digital infrastructure is structured to efficiently deal with non-standard contracts or process changes, there's no operational curveball that might throw your organisation off balance or slow down the agreement process. Faster contracts means faster revenue, better customer interactions, and across-the-board reduction in wasted time and resources.

4. The increasing role of artificial intelligence in contract analytics

Artificial Intelligence (AI) is a trendy enough word on its own, but business professionals often don't recognise the practical implications of an AI-assisted contract management process.

AI can be used in clear-cut ways to address some of the biggest pain points in every document management strategy. 47% of sales teams say analysing nonstandard agreements for opportunities and risks—in a shifting regulatory environment—is the most difficult part of the post-execution process.

New AI and business analytics tools provide a simple solution. For instance, natural language processing software allows you to review large numbers of existing agreements in an instant, so you can uncover and optimise outdated or risky language with little to no manual effort. Additionally, as traditional contract approvers (like legal teams) train AI to analyse contracts, line-of-business users don't have to worry about diving deep into complex contracts or getting lost in technical, legal language.

As the business world gets more and more complex, contracts will need reassessment and reconfiguring with greater frequency. Enhancing your ability to quickly respond to a mutable regulatory environment helps minimise risks and increase visibility during even the most complex sales, M&A or procurement processes.

5. Greater urgency and awareness for data privacy

With inconsistent standards across borders and an increasing number of cyber attacks each year, organisations must recognise that the benefits of data privacy extend beyond the regulatory environment. Organisations need a simple way to stay on top of emerging (broad or regional) trends, so it's easy to quickly adapt or make changes to existing policies.

In addition to providing legal adherence, compliance with data privacy regulations builds customer trust and helps protect your organisation from both internal and external security threats. Contact management professionals in every industry can look to contract management AI, electronic signatures and other digital contract lifecycle management (CLM) features to help effectively address data privacy concerns.

6. Climate-aware contracting is on every globally conscious business' radar

Supply-chain management and product shipping accounts for between 50% and 70% of corporate carbon emissions—and 3% of the world's total CO2 emissions. According to a published report by CDP, 215 of the world's largest global companies are recognising climate change as a serious threat to business. With nearly $1 trillion (and the planet) at risk, 73% of responding companies confirmed board-level oversight of climate-related risks.

Climate-aware contracting is quickly becoming a leading solution to deal with the growing environmental impact of business. Here again, part of the struggle involves knowing what's in your current agreements—identifying contracts and clauses that deal with (or fail to address) climate-driven regulations.

Digital contract technology also eliminates the paper-intensive processes that legacy contract management strategies rely on. With paper out of the equation, the environmental impact of the agreement process is reduced.

7. Digital identification strategies promote fast, secure information sharing

We've all gotten used to verifying our identities on a daily basis—whether it's for opening our smartphone or using a PIN number to authenticate a debit-card purchase. The business world is no different, but the stakes are higher. Replacing analog identification methods with new, digital identification solutions increases efficiency and provides greater security at every stage of the contract management process.

As socially-distant office environments become an accepted part of business and regulations evolve, secure digital identification will play a central role in remotely passing sensitive information between parties. Fortunately, new tech makes it easy to securely authenticate all users.

In addition to enhancing data privacy, digital identification also makes it easier for end users to access and manage information—balancing the customer experience with greater enterprise security. 56% of HR professionals said ID management would become critical to their success over the next five years.

While the field is still relatively new, in the near future, mainstream adoption of biometric identification and facial recognition software will continue to simplify and secure the identification process— eliminating the need for username-password sign-ons or third-party verification apps.

8. Improving the customer and employee experience with contract efficiency

The customer experience has and always will be a primary driver of process improvement. But, as technological development reaches all aspects of business, customers will be less inclined to put up with the slow-moving, manual processes of the past—especially when competitors in every industry are adopting more efficient ways of conducting business.

Expect to see an even greater emphasis on personalized, streamlined experiences for customers. In contract management, this may involve providing a simpler, more efficient client, vendor or patient onboarding process. All parties should be able to easily fill, sign and send required documents on any device from any location.

For instance, PDFs that need to be downloaded, printed, filled, signed, scanned and sent manually will be viewed as a source of friction. Organisations that rely on similar, out-dated contract management procedures make life harder for customers, impede employee productivity, and forfeit revenue—as time-to-completion increases and slow-moving documents are abandoned.

In addition to enhancing customer and employee satisfaction, less time spent on manual, paper-based processes means management can spend more time on broader business strategy and big-picture concerns.

Prepare for the future of contract management today

Investing in new technology like contract lifecycle management to support an accelerated digital transformation should be at the top of every forward-thinking contract management professional's to-do list for 2025.

As companies scale, the number of stakeholders and the complexity of the contract process dramatically increases. Staying on top of the latest trends in contract management will help you develop a document management strategy that promotes more efficient, secure and customer-centric business practices for years to come.