Poor agreement management costs organisations globally a total of nearly $2 trillion (£1.6trn) a year, according to a Deloitte study sponsored by document management vendor Docusign.
A report, dubbed Unlocking the Value of Agreement Management, found that existing tools and processes for handling documents, agreements and contracts are often weighing companies down, adding inefficiency, the vendor said in a related blog post – here.
“Value destruction [is] happening unevenly across functions, but with an overwhelmingly negative impact on customer and partner relationships,” it said, pinpointing “disconnected workflows” as a root cause.
“On average, companies spend an extra 18% of their time on agreements, resulting in over 55 billion hours wasted globally per year,” according to Docusign.
“An agreement can undergo 15-plus hand-offs internally before any counterparty negotiation.”
The survey confirmed that sales and marketing “value loss” – such as deal delays – comprised 40% of the waste, with support functions accounting for 60%, the vendor said.
Other findings included that 48% of businesses in the survey believed their customer relationships had deteriorated “significantly” due to agreement delays. Most agreed inefficient agreement workflows could reduce customer satisfaction.
Instead, organisations should look to implement solutions that offer “seamless collaboration across stakeholders, Al-enabled search and analytics, up and downstream process integrations with applications and databases, and persona-based workflows”, according to Docusign.
The Deloitte report found that 62% of respondents struggled to find and access previously approved contracts for reference, potentially adding cycles of internal review in later stages, and 54% indicated they had to manually track and analyse key terms, deadlines, renewal dates and enforcements.
Additionally, 50% endured “tedious, inefficient and repetitive” legal and compliance approval processes, the vendor said.
“Forty-five percent of respondents have to manually add information to contracts that already exist in systems,” it added. “Any time contact preparers manually complete work that could be automated, they’re wasting time. They’re also introducing opportunities for errors.”
Deloitte used the hours lost to estimate the costs, according to Docusign.
( Photo by Scott Graham on Unsplash )
 a year, according to a Deloitte study.){kind=link}