Four Skills Needed to Manage Contracts with Contract Management Software

Contract Management software (CM or CLM) changes the role of contract managers, but some important elements of the job will remain the same.

Steven Jameson

Contract Management software does not take jobs. It does not even change the qualities required by a good contract manager. But removing time spent on organization and monitoring does free up high-value opportunities to optimize contracts, grow relationships with customers, and help the company achieve strategic objectives with contracts. Understanding what new skills will be required as soon as more advanced software takes on the more menial contract management tasks will be worthwhile.

Manage Contracts More Efficiently, but Remember to Apply the Saved Time to Effectiveness

Contract management was an administrative role for decades, requiring time-intensive work on organizational activities, such as:

  1. Proper maintenance and organization of contractual records
  2. Distribution of signed contracts to the right stakeholders
  3. Oversight of service level-agreement and transaction compliance
  4. Monitoring of terms of service and customer satisfaction.

Tracking these items through spreadsheets was (and for some companies, still is) a nightmare. But what happens when software automates much of the work required by these responsibilities? The free time should count toward a smarter contract strategy, one that levers the efficiency gains for gains in effectiveness. Part of the gain is spent in learning technology or new processes; the rest can go to, for example, devising a consistent approach to contracts. This is detail-oriented work of a different nature, requiring a deep understanding of the business’ goals, as well as the finer points of contract management. But with the right expertise, a contract manager can systematize contracting, so that reps can put together the most appropriate clauses for the given deal. Contracting can and should be an integral component of the sales playbook.

This is just one example of how contract management technology shifts workload from organizational activities to problem solving on a systemic level. The details change, but the need to focus on the details actually increases; the stakes rise.

Manage Contracts and Build Relationships: Negotiation

Contract managers are often required to serve as the point of contact for customers and employees for questions pertaining to contracts. These responsibilities will ideally include negotiation on behalf of the company with customer attorneys or procurement staff because most sales reps will be limited in this arena. Someone with legal education and relationship skills will be needed when third parties request changes to the contract.

Whether negotiations occur face-to-face or via software, contract managers add value with deft diplomacy. The understanding of what products and services should be paired with what terms and conditions is one thing; understanding how to communicate and negotiate terms with third parties is another.

Beyond P&L - Problem Solving in Volatile Environments

In the volatile trade environment of 2017, contract managers are forced to play a key role in adaptation and improvisation of the business strategy.

Contracts are significantly exposed to changes in the business environment. Changes in trading patterns, taxes, and laws directly impact who companies buy from and sell to, as well as how they buy and sell. Manufacturers who used to rely on a strategy of vertical acquisition and creating all components internally are now engaging in more purchasing decisions, also crafting new procurement contracts to exert control on their suppliers without owning them. Contract managers must work with marketers and accountants to develop new contract strategies, helping the organization adapt.

Read our article about how GE mitigates supplier risk while decreasing time-to-market with contracts to see how integrated contract management can change the game.

Legal Proficiency: Does a Contract Manager Need a JD?

The industry is not yet in consensus about whether contract managers need graduate-level legal training. Contract management is a multidisciplinary field, requiring proficiency across law, business, and relationship building. There are examples of great contract managers who hold JDs, examples of some who hold MBAs, and plenty of alternatives.

However, given the change in environment and technology, the industry is moving away from administrative tasks and toward higher-level functions. The sticking point here is that contractual solutions need to be enforceable in court or they do not truly solve anything.

If you are an undergraduate considering a career in contract management, the JD is the most commonly recommended. And if you are using an implementation partner to help you revise contract management processes, then hire a partner with all of the above expertise, including a JD.

Manage Contracts Systemically: Takeaways

The changing role of the contract manager exemplifies the most challenging aspect of change management initiatives. Taking away the more menial, yet time-consuming tasks forces adoption of new characteristics and learning. These should go well beyond the training required to use software, ultimately raising the contract manager’s ability to execute the corporate strategy.

These new capabilities tend to be misunderstood - not only in contract management but across business software. The point of improving a process is to render old objectives easier to accomplish... so that new objectives can be engaged.

Contract managers who can take a moment, step back, and choose how to use the saved time effectively will be the winners in the digital business.


Cummins, Tim. “The Role of the Contract Manager: 2014 Update.” Commitment Matters: January 28, 2014.

Dipesh Tailor, Steve Levett, and Ben Arguile. “Finding your way to a career in contract management.” Contracting Excellence: January 15, 2014. Accessed on March 1, 2017.

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