When contract management has begun to seem complicated or time-consuming, it is an excellent indicator that what you are doing now could use an upgrade.
The key is to identify a best contract tracking software that will allow you to monitor the progress and facilitate the work of your business without extra effort.
In this blog, we will explore how contract tracking software can transform the way businesses manage agreements, from monitoring key dates to tracking obligations, helping teams stay organized, make informed make informed decisions and maximize the potential of each contract.
Contract tracking introduces order and clarity to your processes. When you can clearly see the position of each contract between the time of creation and the time of approval and renewing your teams work faster, and mistakes are minimized, and insights are easier to discover.
A purpose-built system will enable your business to work more efficiently, accurately and confidently.
What Is Contract Tracking Software?
A contract tracking software assists organizations to manage their contracts with accuracy through all the contract lifecycle stages.
It is not only a storage, but it offers full visibility of significant dates, commitments, and progress, making teams proactive instead of reactive.
Having a dependable solution in place, businesses can be able to track approvals, renewal schedules, compliance status, and performance indicators in real time to make smarter decisions and operate more smoothly.
Importance of Contract Tracking Software
According to a study conducted by Deloitte, 8.6% of value is attributed to poor management of contracts. This emphasizes the need to have a systematic system. The following are some of the reasons why companies require contract management solutions.
- Organizations have a lot of contracts that are usually hard to track manually to determine the terms, date, and obligations.
- Late renewals, approvals or exclusion can lead to loss of revenue or compliance.
- Centralized contracting system enables teams to store, retrieve and administer agreements centrally.
- The history of complete contracts helps in audits, compliance requirements and internal reviews.
- Transparency of contract status assists teams to detect delays and enhance efficiency in the workflow.
- The standard processes minimize manual errors and interdepartmental discrepancies.
- The quicker access to the contract information helps to make the renewals, updates, and negotiations timely.
- Less use of emails, spreadsheets, and paper files enhances overall control and organization.
How the Contract Tracking Process Works?
The process of tracking contracts is very straightforward and stepwise, which assists the organizations in tracking all the contracts that they make and sign. It enables teams to track contracts to the start till the end or renewal without any loss of visibility along the way.
Contract Drafting
This begins with the preparation of a contract. This can be that of a vendor, customer, partner or internal. A reference number or tag is normally assigned to each contract to facilitate easy tracking of the contract through its lifecycle.
Central Digital Storage
Once the contract has been drafted, it is stored in a centralized digital system. This simplifies the document to the authorized users and eliminates the necessity of using paper files or folders that are lost. The different versions of the contract are all located in a single place.
Contract Status Updates
The contract tracking software updates on the progress of the contract as it proceeds. The stages are usually drafting, review, approval, signing and renewal. These updates enable teams to be aware of the present status of the agreement in real time without having to make manual follow-ups.
Alerts and Reminders
The contract tracking software can issue notifications on important dates like renewal, payment schedule or review. Such reminders assist teams to work on schedule and prevent late deadlines or forgotten duties.
Activity History
All the changes to the contract are documented, such as edits, approvals and status changes. This forms a clear record of the activities that can be viewed later to ensure internal checks or audits or as a reference.
Reports andAnalysis
Contract tracking software also offer reports that indicate the active contracts, the renewals, the pending approvals among other helpful information. Such reports enable teams to have a better comprehension of workload, obligations, and timelines.
7. Closure or Renewal
At the expiry of a contract, it is either closed or submitted to review in case it needs to be renewed. This process assists organizations to proceed with agreements where necessary and close finalized contracts in the right manner without omitting important actions.
Difference Between Manual Tracking and Contract Tracking Software
| Aspect | Manual Tracking | Contract Tracking Software |
| Efficiency | Time-consuming, requires constant follow-ups and manual updates. | Automates tracking and updates, saving hours of administrative work. |
| Accuracy | Higher chance of errors such as missed deadlines, incorrect status, or overlooked contracts. | Reduces errors by automatically monitoring deadlines, approvals, and milestones. |
| Visibility | Limited visibility; teams may not know the real-time status of contracts. | Provides a centralized dashboard with real-time contract status for all stakeholders. |
| Collaboration | Difficult to coordinate across departments; information often siloed. | Difficult to coordinate across departments; information often siloed.Enables cross-team collaboration with shared access to contracts and updates. |
| Alerts & Reminders | Relies on manual calendars or notes, which can be easily missed. | Sends automatic alerts for renewals, approvals, and key milestones. |
| Reporting & Analytics | Requires manual compilation of reports, making insights slow and limited. | Generates actionable reports and analytics instantly for better decision-making. |
Features of Contract Tracking Software
Contract tracking software assists organizations to be updated on their contracts at all levels. The following are the main characteristics that enable successful contract management.
Central Contract Repository
All the agreements are kept in a single place and it is easy to access and read the contract whenever required by the teams. The crucial data like parties involved, significant dates, and terms can be accessed without having to search emails and folders. One repository is also useful in keeping all records of audits and reference in the future.
Important Date Notifications and Alerts
Important dates such as renewals, expirations and payment dates are automatically tracked. The right team members are informed of the notification so that they can act in time. This assists companies in keeping track of events in the future and better schedule contract times.
Obligation Monitoring
Contracts have obligations that must be followed up regularly during their lifecycle. Contract tracking software documents all obligations and shows its status, e.g. completed or pending. This assists teams to remain conscious of assigned duties and take the necessary action in time when follow-ups are necessary. It is also easier to coordinate the teams involved in the agreement because clear visibility of the obligations is promoted.
Milestone Trackin
Most contracts are designed in terms of specific steps or check points. The feature enables the teams to monitor the progress of every stage and revisit whether the milestones are being achieved as scheduled. With the help of contract tracking software, teams can track their progress over time and schedule tasks and resources regarding future milestones and contract schedules.
Audit History
All the activities performed on a contract are documented such as edits, approvals, and updates. Contract tracking software keeps a history of activities that record the name of the people making changes and the time of the changes. This history facilitates internal audits, compliance audits and problem solving by offering a clear and dependable history of contract activity.
Version Control
Contracts often go through multiple revisions during reviews or updates. Version tracking keeps a record of each change, allowing teams to compare versions and refer to earlier drafts when needed. With contract tracking software, the latest version is always easy to identify while previous versions remain available for reference. This helps teams manage updates in a clear and organized way.
7. Reporting and Analytics
This feature gives transparent reports of the contract activity, key dates, renewals, and the overall performance. The teams can see the data on contracts in a single location to comprehend the timelines, workloads, and future actions. With contract tracking software, the teams can examine the trends, identify recurring patterns, and assess the management of contracts throughout the organization.
In general, contract tracking system offers formalized tools that assist teams to handle obligations, milestones, changes and documentation throughout the entire contract life cycle.
Benefits of Contract Tracking Software
Contract tracking software provides organizations with capabilities to track contracts and extract valuable information throughout the contract lifecycle. By having the correct solution in place, the businesses can enhance productivity.
Faster Contract Handling
Having many contracts manually handled may slow down day-to-day work. Studiesindicate that 89% of firms find it difficult to handle high-volume, routine contracts, which in most cases lead to delays and lost opportunities. Having a centralized storage and a rapid access to agreements, teams can find documents immediately, act on important dates, and keep the contract activities on the move.
Improved Contract Value Retention
Any contract has financial and business worth. Research indicates that contracts lose about 8.6% of their potential value because of failed deadlines, missed terms or poor supervision. Contract tracking software emphasizes the date of renewal, milestones, performance indicators to ensure that teams are able to act early, safeguard contract value and negotiate more effectively.
Less Administrative Work for Legal Teams
Much of the time, legal teams are engaged in non-legal activities. Gartner estimates that 25-40% of the time spent by lawyers is on administrative tasks. This workload can be minimized through automated reminders, approval tracking, and document access, which enables legal professionals to devote more time to contract reviews, risk assessment, and negotiation.
Better Coordination Across Teams
Various departments are involved in contracts including legal, finance, procurement and operations. Contract tracking software enables teams to monitor contract status, track approvals and track deadlines by keeping agreements in a single location. This enhances coordination and assists teams to deliver tasks within the required time.
Stronger Compliance and Risk Oversight
It is important to meet the contract terms to avoid fines and safeguard business interests. Automated notifications and duty monitoring will keep teams informed about future deadlines and duties. Contract tracking software assists in enhanced monitoring of terms and conditions and assists organizations to track internal policies and regulatory requirements in a more efficient manner.
Certain Clues to Making Decisions
The current solutions give reports on trends in renewals, contract duration, vendor performance, and compliance activity. These lessonsassist leaders to recognize the areas of improvement, prioritize high-value agreements, and make future decisions using actual data.
Increased Productivity in the Organization
Time wasted in repetitive activities like reminding, approvals and searching of documents is minimized through automation. This enables the teams to concentrate on more valuable work and make decisions at a quicker pace. Researchindicates that automated contracting processes may decrease negotiating time by half and decrease erroneous payments by 75 to 90% , which results in quantifiable productivity improvements.
Lower Operational Costs
The time and resources are used in handling contracts manually. Contract tracking software assists organizations in minimizing administrative workload, better capturing the value of the contract, and diverting resources to growth activities.Businesses have a better cost control and enhanced financial performance by reducing overhead and enhancing efficiency.
Best Practices to Implement During the Contract Tracking Process
Formal contract tracking process assists organizations to be aware of agreements, deadlines, and responsibilities during the contract life cycle. These practices are aimed in the way contracts are managed between their creation to renewal.
Bringing All Contract Records Together
Contracts may be developed, distributed, and edited by many teams, which may result in the dissemination of files and poor visibility. Storing agreements in various places means that teams use additional time to find the documents, check the versions, or verify the information.
- Keep all the contracts in a single system with access control rules
- Maintain related documents like amendments, approvals and attachments to the parent contract
- Use standard naming and reference conventions to facilitate tracking
2. IdentifyUnclarity in Contract Ownership
Any contract must have a specific owner who will monitor progress, keep records and organize reviews. In case of unclear ownership, follow-ups can be postponed and crucial actions can be overlooked.
- Maintain single contract owner per contract
- Details of record ownership indicate the time of contract addition to the system
- Reassign ownerships whenever there is a change in team role
3. Monitor Important Dates and Milestones
Contracts also have several key dates that must be considered throughout the time, including start dates, review periods, and renewals. These dates can be neglected without adequate monitoring. Tracking of key dates and milestones assists teams to be conscious of the next actions and be able to manage contracts on time.
- Note down all significant dates in contract setup
- Check future milestones on a frequent basis
- Date of update of terms of contracts
5. Keep a Full Contract Activity Record
Contracts are usually subjected to numerous modifications and approvals. Maintaining a complete log of such activities assists teams in knowing how the contracts have been modified and assists internal audits.
- Log all changes, approvals and status
- Store historical activity in the long term
- Checks activity records in internal assessment
6. Standardize Steps of Contract Review
Regular review processes aid teams to review contracts in a systematic and a repeatable manner. Contracts become more difficult to manage across departments when there is a difference in the review processes.
- Identify distinct phases like draft, review, approval and renewal
- Repeat the same review process with similar types of contracts
- Results of document review to be used in the future
7. Ongoing Contract Review
Reports are helpful in giving a clear understanding of the status of the contract, schedules, and future activities. Regular review of contract data assists teams in planning work, priorities, and being aware of the contract activity within the organization.
- Check the reports on the ongoing contracts and dates
- Determine contracts to be addressed according to timelines
- Plan reviews and resource allocation using report findings
Why CLM 365 Is a Great Fit for Tracking Agreements?
CLM 365 is developed on the Microsoft ecosystem, which is why it is a logical selection of teams that already use Microsoft 365 solutions, including Teams, Outlook, SharePoint, Word, and Copilot. This tight integration enables the contract information to be kept in the same working environment that the teams work daily.
After adding a contract to CLM 365, teams can view and monitor all activities of a contract in one place. All the stages including reviews, approvals, updates, and renewals can be seen at a single location making it easy to track the progress and keep track of the same.
Intelligent features and automation can keep the records of the contract in order and provide the teams with a clear picture of the actions taken, the dates and status of the contract in the lifecycle.
Conclusion
Effective contract tracking assists teams to remain conscious of all agreements, significant dates, and potential risks at the initial phases. Automatic updates, timely notifications and visibility ensure that teams are always aware of what is going on with their contracts and what they should pay attention to.
CLM 365 simplifies the process of handling contracts and simplifies their management. It assists teams to monitor, audit and manage contracts under a single location, which saves time and effort throughout the entire contract process.
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Frequently Asked Questions
How can contract compliance be tracked?
Contract compliance means checking whether everyone is following what was agreed. This can be done by:
- Using contract tools that send reminders for important dates
- Checking contract terms from time to time
- Storing approvals and updates in digital form
- Creating reports to spot issues or missed actions early
How do organizations manage and track contracts?
Most organizations use a single system to store and manage all contracts in digital format. This usually includes:
- A central dashboard to view deadlines and progress
- Automatic reminders for renewals, expiry dates, and tasks
- Activity logs that show who reviewed or approved changes
- Sorting contracts by category, team, or urgency
These practices help teams stay organized and avoid missing important contracts.
What are the four key areas to watch after a contract starts?
Once a contract is active, teams should keep an eye on:
- Important Dates – renewal dates, end dates, and milestones
- Responsibilities – tasks and deliverables for all parties
- Financial Details – payments, fees, penalties, and pricing
- Compliance and Risk – legal, operational, or agreement-related issues
- Tracking these areas helps contracts stay on track and prevents costly problems.
What are the four key areas to watch after a contract starts?
Once a contract is active, teams should keep an eye on:
- Important Dates – renewal dates, end dates, and milestones
- Responsibilities – tasks and deliverables for all parties
- Financial Details – payments, fees, penalties, and pricing
- Compliance and Risk – legal, operational, or agreement-related issues
- Tracking these areas helps contracts stay on track and prevents costly problems.
How does contract tracking support audits?
During audits, reviewers can quickly view contract timelines, past updates, and obligation status. This reduces audit effort and helps teams respond faster to audit requests.
Can contracts be viewed by their current stage?
Yes. Contracts are automatically grouped based on their current stage, making it easy to track progress and manage everything from one dashboard.
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