Contract Management in Procurement: What Enterprises Actually Need

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Contract Management in Procurement

Some adjustments are needed, especially around workflows and approvals, but CLM is designed to enhance how procurement already operates — not overhaul it. The biggest shift is moving away from spreadsheets and emails toward centralized, automated processes.

High-value, long-term, or complex contracts — like MSAs, SOWs, and global supplier agreements — benefit the most. These often include detailed obligations, compliance terms, and renewal clauses that are hard to manage manually.

CLM continuously scans contracts for risky terms, compliance gaps, or deviations from standard clauses. It can alert procurement teams before issues escalate, helping reduce financial, legal, and operational risk.

Procurement can expect significant ROI across several areas: direct cost savings through reduced value leakage, better negotiation outcomes, and maximized rebates (often 2% or more annually); major efficiency gains by automating manual tasks and accelerating contract cycles (potentially reducing cycle times by 50% or more); and substantial risk reduction through improved compliance and proactive issue identification.