Contract lifecycle management: strategic sourcing

1. Contract LifecycleManagement [CLM]Bridging procurementand supply management

2. Why is CLM gaining focus among enterprises? To manage the huge volume of procurement contracts 13,000 procurement contracts In large enterprises 8,200 procurement contracts in medium enterprises 4,000 procurement contracts in small enterprises To keep an account of the contracts and to comply with legal protocols 60% of corporate litigations are related to contract disputes 73% indicated 'price changes‘ as the most common contract dispute 12% to 15% of contracts lost or unaccounted for in organizations [Source: Aberdeen Group, November 2011]

3. Where do enterprises seek improvement? Poor compliance 37% - Improve supplier compliance to contracts Missed cost savings 66% - Better control of enterprise spend Increase in the contract cycle time 34% - Visibility into supplier performance on contracts Lack of visibility 44% - Visibility into contractual agreements Error-prone contracts 40% - Reduce supply and supplier risk [Source: Aberdeen Group, November 2011]

4. Why do best-in-class organizations use CLM solutions? To understand existing contractual obligations To realize more negotiated savings To reduce approval times To identify opportunities for savings To prevent inefficiencies • To improve • Process standardization • Contract compliance • Transparency in procurement To bring more spend volume under management with spend analysis

5. What are the benefits of CLM Solutions? Effective centralized contract management combined with CLM solutions help organizations with Savings and efficiencies Impact on the bottom line 79% of spend under management 1.38x more likely to avoid penalties 17% average contract savings realized 2X more likely to track rebates 6X reduction in cycle time 77% more likely to review achievement of milestones/status of contracts 71% of e-signature users have seen efficiency [Source: Aberdeen Group, November 2011]

6. What are the benefits of CLM Solutions? Effective centralized contract management combined with CLM solutions help organizations with Visibility and performance Knowledge management 80% claim more visibility into compliance to negotiated terms and conditions 30% more likely to use contract templates in CLM systems 20% more likely to have a legal library of clauses, terms and conditions 63% claim improved compliance to service level agreements 92% more likely to search their contract repository by keywords, full text, or terms 62% claim improved visibility into supplier performance management [Source: Aberdeen Group, November 2011]

7. What are the benefits of CLM Solutions? Effective centralized contract management combined with CLM solutions help organizations with Relationship with suppliers 64% more likely to have dispute resolution procedures with their suppliers As a result their supplier negotiation cycles are 19 days shorter [Source: Aberdeen Group, November 2011]

8. What are procurement CLM Best Practices? Understand how contract management impacts spend management Evolve from tactical approach to strategic Include automation in the CLM solution Manage and standardize processes Have the visibility into spend Establish a central repository for all enterprise procurement contracts Be proactive because being reactive can be quite expensive Understand the features and functionality used in CLM solutions

9. How can Selectica Contract Management solutions help? • Take contract maintenance out of the hands of legal counsel Reduce expenses and costs associated with contractual documents, systems and processes • Maximize saving opportunities • Improve auditing contract systems and processes • Focus on increasing efficiency and driving cost savings • Create common policies and procedures • Control risks and improve profitability

10. Get a better grip on your spend. Procurement Contract Lifecycle Management – Assessing the Value of Contract Automation DOWNLOAD WHITE PAPER www.selectica.com