Due to the sheer volume of vendor contracts and intellectual property that colleges and universities manage on a daily basis, they have developed a reputation for being risk-averse and slow-moving when it comes to contract management. Volume alone creates numerous challenges when streaming contracts across multiple university departments. For schools to effectively function operationally, it’s essential they learn to automate as much of the contract management process as possible. However, if automation is not done correctly, it can lead to significant legal, financial and procurement risk.
Schools frequently turn to contract management solutions for help, which provide schools with the tools needed to streamline document management and maintain compliance standards around contract storage. Good education contract management software allows for cross-department collaboration while providing schools with a secure central document repository. However, it's important to keep in mind that not all platforms are custom-suited for higher education.
Why is Education Contract Management Software Important for Colleges and University?
Universities include multiple schools, which in turn are made-up of multiple departments - each with their own sets of needs. To function successfully, higher education leaders must maintain visibility into the operations across the entire university, while also allowing each school and department to operate independently. When university departments completely operate in silos and deviate from a standardized university document management process, it can lead to risk and expensive problems.
With each school and department potentially contracting with dozens of service providers, the number of contracts flowing across legal, procurement, and finance departments can be high and not easily managed without an automated workflow. Additionally, schools are expected to adhere to compliance standards and protect confidential agreements from data breaches, hackers, or unauthorized access. Network drives and shared folders do not provide an acceptable level of security to protect documents.
Because of the complexity of a higher education institution’s contract lifecycle and the sheer number of employees and vendors, schools need a simple, automated solution in order to maintain operational efficiency, adopt employee usage, and maintain compliant document storage standards.
What are Some of the Ways Colleges and Universities Use Contract Management Software?
Not all contract management software can accommodate the specific needs of a college or university, as many higher education institutions manage contracts differently than companies in other industries. Below are some of the key ways colleges and universities use contract management software to improve the contract lifecycle:
Streamline Document Management
A contract management platform serves as the central document storage location for all contracts across a university’s schools and departments. It can help various stakeholders involved in the contract lifecycle (legal, finance, procurement, etc.) to organize documents in a secure location where they can be easily located and accessed by authorized employees.
To enable employees to quickly find what they need, good contract management platforms are equipped with effective keyword search and filtering, which can eliminate the need for an on-staff contract librarian. Some platforms even have powerful optical character recognition (OCR) technology which makes the text contained within scanned documents searchable, and enables teams to quickly locate specific terms or expiration dates.
Increase Visibility Across the Schools and Departments
It’s not uncommon for multiple university departments to contract with the same vendor and not even realize it. Due to this lack of visibility, vendors have the advantage - they can test multiple price points and service terms across the same university.
Contract management software can solve this. It can provide a university-wide view into the vendors used across departments, any associated pricing, and the contractual obligations of each agreement. This can be especially helpful for university leaders who need to have high-level visibility into the school’s operations. Contract platforms enable users to quickly locate an agreement’s status within the contract lifecycle. Having a holistic view of product and service providers can give higher education institutions the business intelligence needed to streamline the vendor management process and optimize budgets.
Maintain Security and Compliance
Contract solutions can safeguard documents, which can help universities maintain a compliant document storage process that protects documents both unauthorized internal access and external data breaches.
Access controls and user permissions also help schools to mitigate risk. For example, a chancellor may need to access all vendor contracts that detail the sale of products or services to the overall university, while a dean may only need to access contracts specific to his or her school. User permissions - including read/write access - are an important security feature that allows various stakeholders to access what they need while also restricting who can edit, view, or locate a specific contract.
Tools that can ensure only legal teams can edit contracts, or that confidential documents are only able to be viewed by the intended audience, can help a university maintain a compliant contract storage process. Because schools rely on their contract software to protect their documents, it’s important that platforms offer automated back-ups, as well as strong anti-virus and malware protection. They should also be built on a secure hosting environment.
Plan Ahead of Key Dates
Studies have shown that poor contract management costs companies up to 9% of their annual revenue, and that number is likely higher for universities. Auto renewals, expiration dates, delivery dates, or promotional pricing periods are all examples of key dates that must be tracked and managed.
Contract software makes it easy to track key dates with email alerts, in-platform notifications, and calendar reminders. Alerts can be set up for anything and can be set to occur at any regular cadence. Alerts are key to keeping teams synchronized on upcoming tasks and can prevent key contract dates from being missed.
Decrease Procurement Time
On average, it can take up to 30 days for companies to create, negotiate, and execute a contract according to Aberdeen Research. When you break this timeline down to teams and hours, it can also be very expensive.
Education contract management software is built to eliminate bottlenecks in the contract management process. By providing departments with a centralized platform, schools can make contract management collaborative and efficient. Versioning control tools can help facilitate redlines and audit trail capabilities can help managers keep tabs on the latest version of a document. Many schools use multiple platforms to support the procurement process, so a good contract management software should also easily integrate with e-sign platforms and single sign-on solutions.
How Easy is it to Implement Education Contract Management Software?
When searching for education contract management software, it’s important to remember that there is no shortage of solutions offering a multitude of features and functionality. While it may be easy to be sold on a flashy system with all the bells and whistles, universities have to ensure that their contract solution is able to be used and adopted by thousands of employees with varying degrees of technical skills.
Overly complex products can lead to failed implementation and low user adoption - so for colleges and universities, the best solutions are often the simplest and easiest to use. It’s important to look for a platform that offers full integration support and can do the heavy lifting of importing existing contracts into a new system.
Colleges and universities use contract management software to increase visibility of vendor management to school leaders, maintain compliance, and decrease procurement time. Alerts and notifications as well as user roles/permission can also help maintain a sense of security and peace of mind. However, it’s important to remember that not all contract management software can meet the needs of a higher education institution. When selecting a university-wide platform, consider the importance of ease and security.