In a recent webinar titled "Getting Ready for Next-Generation Contract Lifecycle Management," industry leaders from Icertis, Sentara, and PwC came together to share their experiences and insights on the evolving landscape of contract lifecycle management (CLM). As an analyst in the procurement domain, I found the discussion both practical and forward-thinking, particularly regarding the pain points companies face, how to approach contract transformation, and the increasing role of artificial intelligence (AI) in optimizing contract processes.

In this blog, I'll walk through the key themes discussed during the webinar, focusing on the steps organizations are taking to streamline CLM, enhance stakeholder collaboration, and future-proof their contracting processes.

Key Takeaways from the Webinar

1. Articulating Pain Points and Priorities for Transformation

One of the most important starting points in CLM transformation, emphasized during the webinar, is the identification and articulation of pain points. Many organizations find themselves losing value—up to 9%—due to inefficiencies in the contracting process. This loss is attributed to factors like weak handoffs, lack of visibility into contract data, and poor integration between systems.

Annie Alexander from Sentara shared her organization’s experience of dealing with this complexity, describing how multiple stakeholders across various divisions touch contracts, making the process difficult to manage and track. Sentara, like many other organizations, found that contracts and associated information were scattered across multiple systems, which led to inefficiencies. These insights reflect a common challenge: organizations often operate in silos, with different teams managing contracts without a cohesive system.

Laura Savarese from PwC added that many companies she works with are still in the early stages of CLM maturity. Their biggest challenges revolve around manual processes, lack of visibility into contract approval stages, and disconnected systems. Companies at the lower end of the maturity curve are primarily focused on automating workflows and improving collaboration within and across teams.

• Collaboration and Cross-Functional Engagement

An emerging trend in contract management is the growing need for cross-functional collaboration. As contracts become more multidisciplinary, they touch nearly every division of a business, from sales and procurement to legal and finance. However, as discussed during the webinar, there is often no clear ownership of the contracting process, which can lead to inefficiencies and further complications.

Sentara’s Annie described how her organization had to bring multiple stakeholders to the table to understand the current state of contract management. By involving everyone—from sales teams to compliance officers—they ensured that all perspectives were considered. A key takeaway here is the need for organizations to create a collaborative environment where all teams can contribute to shaping the contract management process.

The success of this approach was echoed by Laura, who stressed that clear ownership is vital for optimizing CLM. She mentioned that organizations often bring in PwC to help rationalize and integrate their CLM processes, ensuring that different teams work together seamlessly without stepping on each other's toes.

• Implementation and Change Management

Implementing a CLM solution is a significant undertaking, and the webinar highlighted some best practices for successful adoption. One of the recurring themes was the importance of phased implementation. Both Sentara and PwC advocate for a “crawl, walk, run” approach, where the implementation starts small and scales over time. By focusing on automating the most essential contract workflows first and then expanding to more complex integrations and functionalities, organizations can build confidence among stakeholders and ensure smoother transitions.

Sentara adopted this phased approach by first focusing on their sales processes and operationalizing their contract workflows through Salesforce and Icertis. They started with simpler contracts, such as off-the-shelf contracts that did not require redlining, before moving on to more complex agreements. This step-by-step approach allowed them to achieve small wins and build momentum for larger transformations down the road.

One of the key points made by both speakers was the need to prioritize business outcomes during implementation. Rather than attempting to customize solutions to fit existing processes, organizations should be open to rethinking their workflows to align with best practices offered by the CLM platform. This mindset can help companies avoid the costly and time-consuming process of customizing software unnecessarily.

• AI-Driven CLM: The Future of Contracting

As the discussion turned toward the future, it was clear that AI will play a pivotal role in next-generation CLM. Laura highlighted how AI can help organizations streamline contract negotiations and automatically flag high-risk contracts for legal review. However, the speakers were careful to note that AI is not a magic bullet—it requires organizations to invest in understanding their contract terms and processes upfront.

AI’s promise lies in its ability to analyse large amounts of contract data quickly and provide actionable insights, reducing the burden on legal and procurement teams. By using AI to identify clauses that pose risks or flag contracts that need further review, organizations can significantly reduce the time spent on manual contract reviews and improve compliance.

Annie also touched on the potential of AI in the healthcare industry, where Sentara operates. She noted that while healthcare organizations must tread carefully when adopting AI due to privacy and regulatory concerns, there are clear opportunities to enhance contract management with AI-powered tools. The ability to automate repetitive tasks, improve compliance, and gain deeper insights into contractual obligations will be crucial for organizations aiming to remain competitive in the future.

Analyst Note: Road to CLM Maturity

From an analyst’s perspective, the journey toward CLM maturity is both challenging and necessary. The discussion in the webinar reaffirmed some key points that organizations should keep in mind:

• Start Small, Scale Gradually: Organizations often benefit from starting with a simple, out-of-the-box solution that addresses core contract management needs. Once the foundation is laid, more complex workflows, customizations, and AI-driven features can be layered on top.
• Invest in Change Management: Implementing a CLM system requires more than just new software. Organizations need to foster a culture of change, ensuring that stakeholders across divisions are engaged and understand the benefits of the new processes.
• Embrace AI, But with Caution: While AI can transform contract management by reducing risks and improving efficiency, it requires a well-thought-out governance structure. Companies need to be clear about how they will train AI systems, monitor their outputs, and ensure compliance with industry regulations.
• Cross-Functional Collaboration is Key: The success of any CLM initiative depends on the involvement of all relevant stakeholders. Clear ownership and collaboration are essential for streamlining the contracting process and improving efficiency.

In summary, the webinar provided a comprehensive look at the challenges and opportunities in next-generation CLM. For organizations on the path to transformation, the insights shared by Sentara, PwC, and Icertis offer valuable lessons on how to navigate the complexities of contract management while preparing for a future driven by AI and automation. As CLM continues to evolve, the ability to adapt, collaborate, and leverage advanced technologies will be critical to staying ahead in a rapidly changing business environment.

Analyst: Abhishek Dubey, QKS Group