Contract Management Stages for Sales and Marketing: A Big-Picture Guide

Contract Management software vendors have a specific idea of process, and businesses need to take a broader, more thoughtful viewpoint to deliver strategic capabilities to their business. Low-hanging fruit is not always ripe.

Steven Jameson

Competition is shifting, pressure is rising. Errors are dealkillers, and quick response is a necessity from quote-to-order. Contract management stages are often a low-hanging fruit, a valuable opportunity for B2Bs looking to increase the rapidity of the sales cycle.

But low-hanging fruit is not always ripe. Some preparation is needed before jumping into a technical implementation. it is important to ask how and why the sales team sells first, before attempting to impose a new process. The how question is the starting point.

The why question verifies that current and future processes are correct. Current methodologies evolve over time; silos evolve over time. Some of the short-term fixes that reps, managers, leaders, and executives have spliced together might actually deter the business from achieving its strategic objectives in some ways. The how needs to agree with the reason for selling.

The common case is that sales wants to sell; but is sales moving the right product? More apropos to the topic: is sales moving the right services, under the right conditions? We have a methodology for selling, but how much of that methodology actually takes us where we want to go?

Laying the path for change necessitates the removal of these obstacles and inefficiencies, so that technology does not systematize mistakes.

The trouble is - many mid-market sales leaders have not documented contract management stages, and vendors/implementation firms can be in a hurry: The softer you are on process, the more control your implementation partner has. If you do not have a documented process, the contract lifecycle management team would be happy to provide one for you. As we will show, this can lead to quick, systematic contract management, but not strategic alignment between sales and the corporate strategy.

The Contract Management Process in Brief: Nine Stages

CLM vendor consensus defines contract management across exactly eight stages (or nine: people disagree). The vendor-centric contract management process looks like:

  1. Request - The initial request for the contract will begin with a template; CLM software will allow the user to fill out basic information and then disseminate this information throughout the contract template.
  2. Generate - The initial contract is generated by the sales team.
  3. Negotiate - Buyers can push back on terms and conditions, requiring a platform for communicating change requests.
  4. Approval - The buyer agrees to the purchase.
  5. Execute - The seller creates an order and disseminates the order to the right people.
  6. Search/Report - These next two steps are often interchanged as both occur simultaneously. Search/report supports ongoing evaluation and revision - not to the contract, rather, for sales and financial officers: analyzing ROI on terms and service agreements allows the business to price and prioritize effectively.
  7. Comply - Sales sends the order to the right place, where a system exists for maintaining strict adherence to all action obligations.
  8. Amendment - Many contracts require periodic change in order to reflect the current arrangement between companies.
  9. Closing options: Terminate, Renew - Do contracts go to heaven, hell, or are they reincarnated?

From request to close, the above stages define the action items involved in contract management very well: these are terms of sales enablement and sales force automation, making processes easier to manage and more convenient for the sales rep. However, contract management is really larger than these stages.

Where Contract Management Stages Fall Short: More Stages than Nine

The request for a contract is the first discernible step for any given contract, but what is the reason for a contract in the first place? Is there a way for contract management process to change? Is there an avenue for bringing in information from the marketplace? Where is the business case for the contract?

One of the largest differences between buy-side and sell-side CLMs is the approach path to contracts. Possibly due to the fact that buyers are spending and sellers are receiving, sellers do not ask as many questions before entering a contract: the proof is in the cash. But this perspective is too myopic, neglecting the big picture and a long-term, value-centric appraisal of the sale.

Buyers will often create a business case prior to requesting a quote, and their strategy for contract negotiation comes from that business case. Sales could learn a thing or two from buyers. Contract management includes the “wraparound” processes, and we the request and generate phases with four planning stages, including:

  1. Investigate - Plan the full extent of product, services and other contract agreements with market analysis and expectation confirmation.
  2. Target - Position the market opportunity.
  3. Strategy - Decide to tender, specifically configuring, creating a strategic roadmap, developing a communication strategy for the contracting phase.
  4. Design - Create the bid, contract, and prepare for execution.

These stages span the divide between marketing and sales; however, each of these decisions is greatly influenced by any changes in contract management process. This is true because the investigation phase is often confined by what sales reps can execute, and greater ability to execute contract terms and conditions, for reps and for buyers, will impact go-to-market strategy. Overall, more complicated contracts can be executed with more efficient and effective contract management processes, and these first four phases should change to capitalize the value-add.

When software developers plan for an implementation, they tend to confine their focus to the action steps they can automate. The IT-centric approach is fine for businesses that either prioritize short-term gains or business units that prioritize themselves; long-term, organization-wide benefits are unlocked by thoroughly examining the entire contracting process.


Macbeth, Douglas. Contract Lifecycle Management. USA: Bookboon, 2012.

Saxena, A. Enterprise Contract Management: A Practical Guide to

Successfully implementing an ECM solution. Florida, USA: J Ross Publishing, 2008.

Alone We Are Smart; Together We Are Brilliant

Whether you are looking for CPQ, CLM, or CRM, let us help you decide if a Quick-Start, Deep Dive, or Turnaround would be best for your organization.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Back to Top