Effective CLM Tools: 3 Step Guide to Selecting the Best Solution

Selecting the right CLM solution involves a structured decision-making process to ensure the tool meets the specific needs of your organization. By breaking this process into three major stages—Assess, Evaluate, and Discover—you can methodically determine which CLM solution is the best fit. Here’s a step-by-step guide for each stage.

Step 1: Assess

Before evaluating CLM options, it’s essential to first consider the specific challenges and needs of your organization.

1. Pain Points of Different Departments

• Legal: How much time is spent on contract drafting, review, and approval? Are there bottlenecks slowing down the legal process?
• Procurement: How effectively are supplier contracts managed? Is there a lack of visibility into contract expiration dates or compliance risks?
  Sales: Does the sales team struggle with slow approvals that impact revenue generation?
• Finance: Are there challenges in auditing invoices against contracts? Are payment terms consistently enforced?
• Operations: Can the team easily track contract performance, obligations, and milestones?

Understanding each department’s specific pain points is essential in choosing a CLM tool that addresses these challenges.

2. Scale of Operations and Contracting

Assess the volume of contracts you currently manage and consider future growth.

• Consider the complexity of contracts across departments (e.g., procurement vs. sales contracts).
• Ensure the CLM solution can scale with your business as your contract volume increases.

3. Existing Systems and Tech Stack

• Inventory your current tech stack—ERP (e.g., SAP, Oracle), CRM (e.g., Salesforce), procurement, or finance systems (P2P, GRC).
• Ensure the CLM solution can integrate with your existing software through APIs or pre-built connectors.

4. Level of Contract Digitization

• Assess your current level of contract digitization. If you’re still working with physical or fragmented digital contracts, look for a CLM tool that offers bulk ingestion, AI-powered extraction, and centralized contract storage.

Step 2: Evaluate

After assessing your organization’s needs, the next step is to evaluate the various CLM solutions available.

1. What CLM Solutions Are Available?

• Identify leading CLM solutions by researching the market.
• Create a shortlist of solutions based on features, scalability, and overall fit for your business.

2. What CLM Solution Best Suits Your Needs?

• Compare how each CLM tool addresses the pain points identified in the “Assess” stage.
• Look for solutions with pre-built industry-specific packages or tools tailored to departmental needs (e.g., buy-side contracts for procurement, sell-side for sales).

3. What Do Analyst Reports and Peer Reviews Say?

• Refer to reports from Gartner, Forrester, and IDC MarketScape to see which vendors are ranked highly and why.
• Review user feedback on platforms like and Capterra to gain insights from peers in your industry.
• Consider tools with high ratings, especially in the areas relevant to your implementation.

Step 3: Discover

The final stage involves learning from demos, testing features, and assessing the overall fit of the solutions.

1. Take Demos – Request Demos and Engage Key Stakeholders

Involve stakeholders from legal, procurement, finance, sales, and operations to assess critical features during the demo. Test the solution using sample contracts and workflows to evaluate:

• Integration: Ensure seamless integration with your existing systems and confirm that the solution meets your specific requirements.
• User Experience: Is the platform intuitive and easy for all departments to use?
• Collaboration: Can teams collaborate effortlessly in real-time on contract drafting, redlining, and approvals?
• Test Key and Advanced Capabilities:

   

  • AI-Powered Automation: Assess how effectively the AI automates data extraction, contract reviews, and workflows.
  • Performance Tracking: Check for real-time monitoring of obligations, milestones, and compliance.
  • Scalability: Confirm that the platform can handle growing contract volumes and increasing

2. Consider Price

• Understand the pricing model—subscription-based, pay-per-contract, or user-based? Ensure the pricing aligns with your budget.
• Check for hidden costs like implementation fees, custom integration charges, or ongoing maintenance.

3. Time to Implement

• Ask vendors for an implementation timeline. Some CLM tools offer faster deployment options or pre-configured setups.
• Consider how long it will take to onboard your teams and integrate the tool with your workflows.

4. Consider Support for Adoption

• Language Support: Does the solution support the languages used by your team? Multinational teams may need multi-language interfaces and customer support.
• Regional Availability: Can the vendor provide support in your region? Is support available 24/7 or limited to certain time zones?
• Training & Onboarding: Check if the vendor offers comprehensive onboarding, training materials, or a dedicated success manager.