Losing business information can be more than just a nuisance. When that something happens to be an important company document like a contract, the consequences can be severe.
Despite their best efforts, businesses do lose physical documents. It happens. According to the Association for Information and Image Management (AIIM), just about 7.5 percent of all physical business documents are lost and 3 percent are misfiled at least once over the course of their lifespan.
Spending an afternoon looking for a particular document, because it wasn't where it was supposed to be, is annoying, but it is also costly. Workers are spending their valuable time trying to locate a particular file rather than doing something more productive. This can have a sizeable financial impact on an organization. AIIM projects that finding a lost document costs around $120 dollars. Replacing it can cost up to $220. A much bigger problem is when lost documents result in missed corporate obligations. The unrecognized loss of certain contractual documents can result in missed revenue, penalties or losses that can exceed tens of thousands of dollars.
These are expenses many organizations cannot afford, particularly when you consider the number of documents that will be either misplaced or permanently lost over the course of their existence. The consequences of improper contract management can be disasrous, but can be avoided if you have the right tools.
To mitigate these risks, businesses equip themselves with Contract Lifecycle Management (CLM) solutions that allow them to properly store and manage crucial business documents in a secure, central, cloud-based location. Not only does this allow users easy, secure, controlled access to them, it effectively mitigates the likelihood that documents will be lost or misplaced.
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