Contract signing today is no longer the slow, paper-heavy task it once was.
Organizations are now in need of faster, more secure, and more compliant methods of entering a contract and this has led to the rapid adoption of electronic signature.
Contract signing plays a vital role in establishing clear responsibilities, legal validity, and mutual commitment between parties. It protects organizations from disputes while supporting faster, more secure approval through modern electronic signature methods.
A study by Market and Markets says that the digital signature market is expected to reach USD 70,247.0 million by 2030, driven by the shift toward faster authorization, improved protection, and legally recognized digital workflows.
This transformation has restructured the way businesses are conducted through vendor contracts to HR onboarding, NDAs, sales agreements, procurement documents and long-term service partnerships.
What Is Contract Signing?
Contract signing is the final step where parties add signatures to confirm acceptance of all terms, responsibilities, and conditions in an agreement. This will be a legal step to activate the contract and make it valid, enforceable, and binding according to the law.
It offers written evidence of the dedication of all the involved parties and creates a clear basis.
Importance of Signing a Contract in Business
Signing a contract in business is not a mere formality, it is the process which adds clarity, structure and legal force to all professional relationships. Here is why it matters.
1. Builds a Clear Foundation
A contract is a good way of setting a definite point of departure by putting in writing the intention of the contract and what is expected of all parties concerned.
Signing a contract eliminates confusion by defining the way both parties will work, communicate and perform their duties.
This understanding sets the relationship on a stable and well-organized course that can guide the two parties to proceed with a lot of confidence.
2. Offers Legal Clarity and Protection
By putting all the clauses in a contract, the expectations of both parties can be seen and comprehended easily.
Such transparency minimizes the possibility of misunderstanding and promotes open communication during the partnership.
With the same information available to all, teamwork will be more predictable.
3. Improves Transparency Between All Parties
Contract signing explain what should be provided, by whom, and at what time every aspect of the work should be done.
This is a systematic mentoring that keeps teams responsible and minimizes time wastage due to vague or incomplete instructions.
Having a proper roadmap, both parties will be able to monitor the progress more conveniently and ensure the same execution during the agreement.
4. Strengthens Accountability and On-Time Execution
Contracts outline what needs to be delivered, who is responsible, and when each part of the work must be completed.
This structured guidance helps teams stay accountable and reduces delays caused by unclear or incomplete instructions.
With a clear roadmap in place, both sides can track progress more easily and maintain consistent execution throughout the agreement.
5. Helps With Compliance and Audit Readiness
An effective signed contract has vital information in terms, date and signature details that facilitate regulatory and contract compliance requirements.
With such information in place, it becomes easier to address contract audits or present documentation.
This meticulous record keeping also develops trust in the organization since it indicates that all agreements are done in the right way.
6. Reduces Costs Through Digital Signing
Implementation of electronic signature enables companies to save costs associated with printing, posting and processing physical documents.
The Exploding Topics says that an average of 28 dollars can be saved with each agreement signed by means of e-signature.
The more agreements are digitized, the more time and cost savings companies will receive without losing the quality of the approval process.
7. Prevents Delays in Key Business Processes
Signed contract accelerates essential contract lifecycle management process like procurement, vendor registration and sales activation.
When contracts signing is done faster, activities can commence earlier, which assists businesses to avoid delays.
This timely activation helps in a smooth operation and allows teams to achieve their objectives without having to wait to be approved on long approvals.
Difference Between Wet-Ink vs Digital Signature
| Aspects | Wet-Ink Signature | Digital Signature |
| Identity Verification Strength | Relies on manual verification such as ID checks or physical presence. | Uses cryptographic validation, audit trails, and signer authentication. |
| Tamper Visibility | Physical documents can be altered without obvious signs. | Any modification breaks the cryptographic seal, immediately detectable. |
| Signature Tracking Capability | Tracking is manual and depends on paper movement. | Automated tracking logs every action, timestamp, and signer event. |
| Multi-Party Signing Complexity | Requires mailing, scanning, or in-person coordination. | Supports simultaneous or sequential signing across devices. |
| Legal Audit Readiness | Paper files require manual collation for audits. | Digital files include built-in audit trails ready for compliance checks. |
Key Elements of Contract Signing Process
The process of signing the contract consists of several interrelated components. These aspects demonstrate the process of contract signing within the contemporary companies.
1. Contract Creation
Contract creation is the phase at which the agreement is written and with the proper clauses, roles, time schedules, and significant business terms.
A concise and properly developed draft makes everyone know what the contract requires each party to do.
This action will provide a good basis and minimize the possibility of confusion or stalling in the future.
2. Stakeholder Identification
This section in contract signing entails the determination of all the internal and external parties.
Identifying the appropriate stakeholders at an early stage prevents the exclusion of any major decision-maker in the signing process.
It enhances the coordination and ensures that the contract flows well through the contract approval process.
3. Review and Redlining
During review and redlining, legal, finance, procurement, and other relevant teams examine the document and make necessary updates.
This collaborative review strengthens the contract by refining terms, correcting gaps, and aligning requirements.
It leads to a stronger and more reliable agreement that reflects what both parties expect.
4. Signer Authentication Setup
Legal, finance, procurement and other teams involved in the review and redlining process review the document and update it accordingly.
This shared review enhances the contract by improving terms, fixing gaps, and harmonizing requirements.
It results in a more solid and dependable contract signing process that will mirror the expectation of both sides.
5. Signature Method Selection
This step is done by setting up identity verification and signer validation to ensure that the right team are signing the agreement.
The presence of an authentication process will create trust and increase the credibility of the contract.
It also provides an added security to the contract making it more secure and universally acceptable.
6. Signing Sequence Arrangement
This step determines how the contract signatures will be gathered, all at once or in a step-by-step fashion.
The signing order is also clear, and this prevents the bottlenecks and ensures that the contract flows without delays.
It establishes an orderly process that simplifies the signing process to all parties concerned.
7. Signature Capture
It is at this point that the parties eventually sign the agreement under the method selected.
Proper signature capture transforms the contract drafted into an approved and accepted contract.
It is a mutual assent and it takes the contract to a step further towards being legally valid.
8. Completion and Record Logging
After all the contract are signed, the final document is stored, timed and documented to be used in future.
Effective logging will ensure that the organizations can find the contract fast whenever it is required to comply, audit, and internal contract audits.
This structured completion makes the agreement secure, traceable, and usable in the long-term.
Essential Steps to Follow in the Pre-Signing Process
Prior to the signing of any contract, there are some preparatory measures that make the contract clear, compliant and easily executable.
- Map All Required Signers
Begin by listing all individuals, teams, or departments required to look over or sign the contract. This will aid in not missing any important members and will make the whole process organized. The document passes through the process without any surprises when all the signers are familiar beforehand. - Decide the Sequence of Approval
Arrange the transfer of the contract to another. You can select step-by-step order or you can have two or more people to view it simultaneously. The contract management workflow is also faster because of the clear sequence and there is no confusion during the approval stage. - Pick the Signing Method
Select the most convenient and legally acceptable way to sign the contracts. Choosing the right method makes the signing experience easier for everyone and reduces the chance of delays. - Set the Approval Timeline
Determine the time at which every signatory is expected to finish the contract review and apply signature. The establishment of simple and realistic deadlines keeps the process on track. A proper schedule also ensures that everyone is on track and that the activation of the contract is not postponed. - Align With Legal and Compliance Standards
Businesses should ensure that your mode of contracts signing is within legal and regulatory provisions before you dispatch the contract. This covers data protection needs, industry standards and any company policy. The compliance will ensure that your business is safe, and the agreement will be valid in case of any future disputes.
Essential Steps to Follow in the Post-Signing Process
Once a contract is signed, several important steps must follow to keep the agreement active, organized, and fully aligned with business expectations.
- Store the Agreement in a Protected Repository
The first and the most important thing is to keep it in a safe place. Store the contracts in central repository a where it is readily available to the authorized team members whenever required. Having all the things in a secure place minimizes the chances of losing valuable files. - Maintain Version Integrity
It’s important to make sure only the final, approved version of the contract is used in everyday operations. By tracking version history and preventing unauthorized edits, you reduce confusion and avoid the risk outdated terms. Maintaining version integrity also supports better compliance and smooth execution across departments. - Review Contract Milestones and Obligations
After the agreement is in action, go through the key milestones, contractual obligations, and responsibilities that have been written. This would keep the teams informed of what should be delivered, when it should be delivered and who should deliver. Frequent observation avoids time wastage and maintains the relationship between the two parties. - Plan for Renewals or Extensions
Many contracts need to be renewed or extended after a certain period. Reminders or automatic alerts will help you to plan and prevent roadblocks. By planning in advance, there is no interruption in service, or operations and both sides have ample time to renegotiate on terms. - Schedule Periodic Contract Audits
It is important to audit a contract periodically to achieve long-term success. These audits ensure that the two parties are fulfilling their duties, adhering to the rules of compliance, and operating in the terms agreed upon. Audits also assist in the identification of risks, outdated clauses or areas which require improvement.
7 Best Practices to Implement During the Agreement Signing Process
During the agreement signing stage, following a few reliable best practices helps make the process smoother, safer, and more organized for everyone involved.
1. Validate Signer Identity Before Initiating Approval
One of the most crucial processes in the signing of an agreement is identity clarity. It safeguards the contract against disputes and determines the authenticity of the parties.
- Apply authentication techniques that are appropriate to your industry
- Check contact information and access privileges
- Keep signed signer information prior to mailing the document
2. Use Standardized Contract Templates for Repeated Scenarios
Templates minimize variability and introduce clarity to contract clauses that are repeated. They maintain the consistency of language and minimize drafting mistakes in contract signing.
- Add accepted clauses and template forms
- Add pre-defined signature blocks
- Implement updates to templates by authorized teams
3. Provide Clear Instructions to Every Signer
Contract signers are expected to know what they are signing and how the signing process should be done. Such transparency minimizes time wastage and results in speedy delivery.
- Mark important fields and initials
- Provide a single note of explanation on the purpose of the contract
- Add clear notes on where each person needs to sign or initial
4. Maintain a Defined Signing Order
Complicated contracts require an organized order. A hierarchical system eliminates approvals that have not been made and circular communication.
- Prepare a list of each approver
- Automatically send signing requests sequentially
- Time stamps of the records to track internally and legally
5. Track Signing Progress in Real Time
Exposure when signing a contract assists teams to react promptly in case one of them is unavailable or late. It also assists the leadership in tracking movement through key agreements.
- Track who has received and opened the contract using basic status checks or confirmations
- Send polite reminders when a signer has not completed their step on time
- Maintain a clear table or list of all active agreements for quick reference
6. Verify Document Integrity Before Finalizing the Contract
The version that reaches the signer must be accurate, complete, and formally approved.
This prevents disagreements related to missing clauses or outdated drafts.
- Lock the final version before sending for signature.
- Compare revisions with the approved master.
- Archive earlier drafts separately.
7. Archive the Signed Contract With Audit Details
A signed contract is not complete unless it is stored with proper records.
Audit-friendly organization helps when agreements are reviewed months or years later.
- Store the agreement with metadata.
- Attach signer logs and timestamps.
- Place it in a repository accessible to authorized departments.
How Does CLM 365 Help in the Contract Signing Process?
CLM 365 is built on Microsoft ecosystem, which provides businesses with a known, integrated, and secure platform to manage contracts throughout the creation and signing process.
It integrates with SharePoint, Microsoft Teams, Outlook, MS Word, and Microsoft Copilot, enabling teams to write, collaborate, review, and send agreements without leaving their current applications.
To sign contracts, CLM 365 relates to Adobe and DocuSign that enable users to send contracts to be signed digitally with full audit trails, signer authentication, and legally binding authorization.
Regardless of the type of simple approval flows or multi-step agreement signing processes, CLM 365 facilitates current digital execution with well-organized workflows, centralized storage, and full visibility of all signed contracts.
Conclusion
The process of signing contracts has become a digital-first, rapid process that characterizes the functioning of contemporary organizations.
With business becoming faster and partnerships becoming more international, the capacity to sign a contract in a clear and accurate manner with proper documentation is becoming vital to long-term trust and development.
When your company is prepared to transform the way agreements are made, accepted, and signed, CLM 365 assists you to undergo a smarter, quicker, and more joined contract signing procedure.
Begin your 14-day free trial with CLM 365 and experience how contemporary contract signing can change your organization.
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Frequently Asked Questions
How does one sign a contract?
Signing a contract means going through the terms, assuring of responsibilities, and getting the consent of all the required parties. Once the document is confirmed, all the signers append their signatures either through a wet-ink or electronic signature.
What is a signed contract?
Signed contract implies that all the parties will accept the terms of the written document. It is turned into a legally binding document that establishes responsibilities, schedules, rights, and expectations. Since then, both sides have a responsibility of fulfilling what they have agreed upon.
What is the difference between signing and closing?
Signing refers to the process of signing signatures to affirm consent. The process of closing occurs once the signature has been signed and the moment the contract is officially signed, executed and in action.
What are the various forms of contracts that are signed?
There are numerous types of contracts that can be signed based on the type of relations. Examples are service contracts, employment contracts, vendor contracts, partnership contracts, NDAs, and sales contracts.
Is it possible to sign a contract remotely?
Yes, it is possible to sign a contract remotely using electronic signature tools. Remote signing enables individuals to sign contracts at any place with a phone, laptop, or tablet. This is a legal approach that is applicable in most areas and commonly applied by contemporary companies.
Does CLM 365 provide contract amendment?
Yes, CLM 365 is amendable to contract amendments. Users can edit the existing agreements, monitor the changes and generate new versions without losing the previous records.
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