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Hear from businesses who share how Summize has helped them improve savings and increase efficiency.
Calculating ROI
on Contract Lifecycle Management
One of the most common challenges for in-house legal teams looking to introduce technology is working out how to build the business case.
Businesses choose to invest in CLM solutions because contracts sit at the heart of all transactions, and often span multiple departments.
The cost of doing nothing
The truth is that doing nothing to improve your contract processes is likely to be costing your business money. For example, are there any instances where not understanding what was in a contract cost the company money? Instances such as missed auto-renewals or not enforcing obligations or payment?
Inefficiencies in contracting processes can be a blocker of sales revenue, as well as consuming the legal department with manual, menial tasks.
Manual tasks, providing a centralised repository and consolidated task list, and act as the interface between legal and the rest of the business for contract requests. Summize works directly in tools such as Teams, Outlook, HubSpot and Slack to automate the intake process and improve the contract experience for the entire business.
Common challenges we hear from in-house legal teams include:
“We're overworked and spend too much time on manual tasks”
"We're bombarded with requests from sales and commercial teams"
"We have too many complicated processes and no centralised visibility of requests"
"The procurement / legal part of the process takes too long"
Up to 25% of lost revenue
Companies who use traditional contract management processes compared to those using CLM solutions lose up to 25% of revenue (Harvard).
50% of opportunities lost
50% of business development leaders have missed out on business opportunities as a result of contracting inefficiencies (EY, 2021).
Investing in the right CLM
These questions can be used to match the value you could achieve from a CLM, and to assist with setting some early goals. Summize has also produced a handy CLM checklist, with questions to ask of your solution to make sure it best meets your requirements.
10 questions you should ask internally to start painting a picture of your CLM requirements:
How long does it take to create a contract on average?
How many contracts is your business dealing with on a monthly /annual basis?
What is the typical turnaround time for a contract review?
How many times are contracts negotiated/redlined typically for customer contracts?
How much time is the legal team spending on managing contracts that could be used to focus on more strategic projects?
Has your company ever sent out an outdated NDA or contract to a potential customer?
Do you have a log of your renewal dates to ensure you don't miss a commercial opportunity?
Are you spending money on outside counsel support related to contract management?
Do you know the risk level of your contracts?
Do you get complaints internally about how long it takes to turn around a contract?
Building an ROl model
We recommend building an ROl model that compares the cost of your software with the benefits.
In a spreadsheet, you can list out the following costs and benefits using your company assumptions:
Total investment
- Legal user licence costs
- Business user licence costs
- Implementation costs
- Total cost
Contract metrics:
- Annual volume of contracts
- Est. time taken to review each
- Est. time taken to create each
- Assumed time saving (typically 80%)
- Extrapolated time saving (hours)
- Value back to the business (based on annual salary calculation)
ROI = (Investment cost - benefits gained /Investment cost) × 100
The Summize team can share an ROl template for you to edit as part of building your business case. Get in touch with the team to request yours.
