Data and document management have evolved concurrently with supporting technologies, and the way we search for and discover specific information has improved drastically during this time.
Those tasked with contract management face many of the same challenges that have persisted since contracts first appeared. Fortunately, there are more resources today to assist with solving these challenges than ever before, and companies that capitalize on today's solutions will ultimately be more successful managing the myriad obligations that today's contracts impose.
For example, language is extremely crucial to the definition of the obligations and responsibilities of the parties entering into a contract. If the language is flawed and subject to misinterpretation, it opens the door for challenges and potentially serious problems. Because of this, it is important that whoever is tasked with managing such documents, uncover and understand the language in question and do so quickly. Depending on the magnitude of the incident, unless resolved quickly there is always the potential for litigation. After all, we live in a litigious world.
All it may take is one line in a particular document associated with a contract to resolve a claim. Yet taking a substantial amount of time to find the information (or the document itself) could be a major setback to an organization. Two important issues surface. Can I quickly find the document in question and can I find all other documents and specific language that may be affected by similar contractual terms?
The history of document management
Prior to the digitization of information, contracts were typically stored in file cabinets or other physical repositories. That continues to be the case in many companies today. While regulations may still require retention of some physical copies, this is hardly an ideal solution for anyone who must find specific information in a specific contract. Imagine trying to find a specific paper that may be locked in someone's desk, or is not even within the confines of the office. Remember, whenever searching for specific information to prevent a legal dispute, the clock is ticking. Understanding the importance of this and other document management needs, tools and solutions have evolved accordingly.
Information was eventually digitized across many industries and organizations. This is an on-going process that continues today. It has of course helped that much of the initial digital data is now siloed, but even that is not enough. While information may be stored in a specific area(s) in digital format, without the proper tools, it might as difficult to find the required information as when the document was in paper form.
Research showcases the high costs of finding information the old way
In 2006, the London-based IT research and analysis organization Butler Group released a report that indicated "ineffective search and discovery strategies [were] hampering business competitiveness, impairing service delivery and putting companies at risk." The study indicated that 10 percent of salary costs were wasted on employees spending an unnecessary amount of time looking for information. This ultimately hurt companies' ability to compete in their respective fields.
Today, the cloud has helped create centralized digital repositories that allow users to store and securely access all of their information in one place in a single primary location.
With the ability to search large document data sets for specific language, a particular section or paragraph, a phrase or word, users can now do in minutes what would have previously taken days, weeks or even months to accomplish. This functionality is a critical part of robust Contract Life-Cycle Management (CLM) solutions. What this means is when contractual disagreements occur, they can be reviewed and resolved much more quickly than ever before.This goes a long way toward both mitigating any problems that could stem from a dispute, but also allows rapid assessment of a company's current and ongoing exposure to potential liability.
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