Introducing contract obligation management

Are your contracts sprawled across many inboxes, local shared files, or even conventional filing cabinets? How exactly is contract obligation management streamlined? You may find it difficult to locate them during the review process. Several Gartner clients candidly admit they don’t know where all their contracts are. According to an EY survey: 

• 78% of organizations do not track contractual obligations, which raises their exposure to legal risks
• 97% say they find it hard to get a budget to invest in legal tech
• To make it worse, 88% of GCs said that they would be reducing the overall cost of their teams to the business in the near future

Contract obligation management tracks pledges that are legally binding. These obligations span various dimensions of business transactions and relationships, ranging from the delivery of goods and services to compliance with regulatory requirements and the protection of intellectual property rights. 

Types of contractual obligations

For companies looking to maximize productivity and adhere to regulations, let’s categorize the kinds of contractual obligations to understand them better:

1. Non-compete & non-solicitation prohibits participating in competitive activities or approaching potential clients or workers.
2. Non-disclosure preserves privacy by not disclosing any sensitive information that was exchanged during the duration of the contract.
3. Arbitration is the decision to forego going to court in favor of arbitrating conflicts.
4. Term & termination respects the agreed-upon duration of the agreement as well as its termination provisions.
5. Compensation or repayment for incurred losses, damages, or liabilities is known as indemnity.
6. Insurance requirements fulfill the terms of the contract regarding the specific insurance coverage requirements.
7. Governing law and jurisdiction determine which laws and jurisdiction will apply to the interpretation and enforcement of the contract.
8. Intellectual property rights defends and upholds the rights related to the contract’s intellectual property.
9. Law compliance makes sure that pertinent laws, rules, and industry standards are followed.
10. Default & Remedies covers what happens when there is a violation of contract or a default.
11. Force majeure deals with unanticipated events or circumstances that are out of the parties’ control.
12. Change control manages changes to the contract terms or scope during the contract term.
13. Audit rights grant the right to check and review pertinent records and papers in order to verify adherence.

The challenges with traditional contract obligation management 

There are a number of serious drawbacks to standard contractual obligation monitoring techniques, such as manual procedures, poor visibility, and constrained scalability. These procedures are prone to mistakes, hold-ups, and irregularities, which result in inefficiencies and raise the possibility of disagreements and non-compliance. Traditional tracking methods leave you excruciatingly exposed. 

• Drowning in paperwork: There’s only so much you can do with paper contracts and spreadsheets. Sifting through manual archives or disjointed files that exist across multiple devices, folders, and channels.
• Missed deadlines and broken commitments: Manual contractual obligation tracking increases the risk of oversight, its legal ramifications, and financial loss.
• Limited visibility, reduced control: Without a central source of truth, traditional methods hinder proactive management and decision-making. 

In response, there is an urgent need for an automated and analytical approach to managing contractual obligations effectively. Organizations can streamline contract management processes, enhance visibility, and proactively monitor and enforce contractual obligations. By adopting modern CLM solutions like HyperStart, organizations can revolutionize their approach to contract management, mitigate risks, and drive greater efficiency and compliance across their contractual relationships.

The HyperStart advantage

HyperStart leverages cutting-edge technology to provide legal professionals with a distinct advantage in contract lifecycle management. Through our innovative solutions, we redefine the way contracts are managed and executed, ensuring efficiency, compliance, and reliability at every stage of the process.

How HyperStart is revolutionizing contract obligation management

Contract metadata extraction made simpler

HyperStart streamlines the laborious process of contract analysis post execution with automated contract abstraction and extraction of contract metadata. Legal professionals can save a significant amount of time and resources, giving you the freedom to concentrate on risk management and strategic decision-making.

Meticulous tracking system for contractual obligations

At HyperStart, risk mitigation and compliance depend on proactive contractual obligation management. The platform gives stakeholders real-time reminders and warnings while offering real-time visibility into contractual obligations and renewal timelines. This reduces the risk of non-compliance and increases visibility, allowing organizations to fulfill their contractual commitments.

Targeting legal professionals in USA and India

To meet the specific needs and requirements of legal professionals in both the USA and India markets, we’ve processed contracts in these specific regulatory landscapes of these regions and provided custom governing law and compliance clauses to address their challenges with measurable outcomes. Challenging traditional contract obligation management Traditional contract obligation management suffers from several limitations that hinder effective contract management. Manual tracking processes are time-consuming, labor-intensive, and error-prone, leading to delays, inaccuracies, and compliance risks. Moreover, reliance on paper-based documentation and spreadsheets makes it challenging to maintain consistency and ensure data integrity across multiple contracts and stakeholders. Existing contract lifecycle management (CLM) tools, while offering some level of automation and centralization, often fall short of addressing the evolving needs of modern businesses. These tools may lack intuitive user interfaces, robust analytics capabilities, or seamless integration with other enterprise systems. As a result, organizations struggle to extract actionable insights, streamline workflows, and adapt to changing regulatory requirements effectively. Even if they provide some automation and centralization, current contract lifecycle management (CLM) systems frequently fall short of the changing needs of contemporary firms. Primarily because they are out of sync with enterprise systems, don’t offer useful analytics, or have user-friendly interfaces. As a result, businesses find it difficult to budget or build a case for them. 

Innovating contract obligation management

Contract management is ripe for a paradigm shift. To manage contracts with agility, scalability, and adaptability, organizations need to embrace innovation and implement cutting-edge technologies. With cutting-edge technology like blockchain, AI, and machine learning, companies may transform how they handle contracts and open up new avenues for productivity and expansion. Legal teams must steward well what has been entrusted to them. This may be to overcome operational obstacles, reduce risks, think of alternative, novel solutions to missed renewals, and improve stakeholder collaboration with strategic counsel. The use of CLM solutions can put them back in the driver’s seat with improved visibility, simplified procedures, and data-driven decision-making.

Concluding thoughts

Efficient contract due diligence and obligation tracking are more important than ever in today’s dynamic business climate. There is increasing pressure on organizations to minimize risks and maximize operational efficiency, all while ensuring compliance with ever evolving regulatory requirements.  Our approach empowers legal professionals to rethink contract management, embrace automation of rote work technologies, and unlock critical insights from contract data effortlessly.  Leading the way in the legal tech revolution is HyperStart, a cutting-edge provider of AI-driven contract lifecycle management solutions. We represent innovation, efficiency, and leadership in the field of contract management with our unwavering dedication to completely changing the ways in which contracts are drafted, negotiated, signed, and monitored. Our state-of-the-art technology leverages artificial intelligence to reduce human error, automate repetitive operations, and optimize each contract lifecycle stage.