Contract Management

Contracts are the foundation of an effective digital procurement process. Contract management has evolved to enable successful leaders to look beyond traditional contract processes and performance metrics. Contract management of the future continues to maximize commercial value with additional aspects. Additionally, companies are looking for better visibility into obligations and operational resilience from the ever-growing list of third-party relationships and supply chain disruptions. Procurement is driving standardization with templates and defined clauses to be able to perform contract operations with increased speed, agility, and efficiency.

The benefits

• Reduce value leakage: Focusing on “cost” as well as “value beyond cost” through a structured Contract Management framework. For example, reduction of invoice and credit memo errors and other redundancies.
• Prevent disruption: Prioritizing assessments and mitigation with the right risk-based clauses leading to addendums which address risk upfront based on the relationship being established with the third party.
• Improve speed to market: Building a centralized and standardized library that can reduce the time to contract. In addition, defining a structured workflow with risk-based review in mind improves the overall review and external negotiation time, leading to reduced time to signature.
  
• Enhance contract performance management: Identifying obligations and SLAs that provide visibility into the performance of the contracts reduces value leakage we see today and enables procurement to better predict the probability of failure instead of reacting to events.
  
• Reduce cost to serve: Driving self service capabilities during contract request intake, authoring and negotiation. Establishing automation that guides the user, simplifies the support, and reduces the need for intervention to get a contract to signature.

How KPMG can help

KPMG has developed leading practice technology and tools to fast-track companies on their contract management transformation journey. Our services and professionals can help you establish an effective supplier management organization that delivers value to business in the following ways:

• Conduct health check reviews and assess the current Contract Management capabilities across the organization
• Drive Contract Management strategy and assessments to develop a cross functional and holistic strategy at the enterprise level
• Develop a roadmap for the future based on a defined vision that includes the case for change, detailed implementation approach and change management plan
• Enable technology solutions for Contract Management through a functional transformation lens
• Drive insights and actions with Contract discovery and analytics using cognitive capabilities and intelligent automation