COVID-19 exposed the vulnerability of poor contract management
This is a guest blog by Petri Hollmén, co-founder and CEO of Lyyti
Contracts are mainly written so that as long as everything is fine, nobody needs to remember the terms of service, commercial guidelines of the contract nor termination period. As long as we remember to produce the service sold and also send an invoice regularly, both parties are quite alright.
Things change as a crisis hits the business. What is the size of our liabilities in our contract base? What is an average termination period? How long are we up and running, if every customer terminates the contract today? These are questions that many companies had to go through during the COVID-19 pandemic in 2020.
A well-managed contract base creates clarity and predictability. Further, contract management is not only risk management, it is also an enabler for growth in a new world.
A lot of companies are still working with pen and paper, when it comes to contracts. This sounds odd, as most other parts of business processes have been digitalized years ago. How to get the paper signed and business partnership up and running as most of the involved people might live in different locations and you have no clue where? General office address with the receiver’s name written on it does not work anymore. At best, sending paper copies by snail mail prolongs the process by days or weeks, but at worst you need to wait until everyone gets back to the office and are ready to sign your physical document. This might take a long time putting your new business initiatives into a standstill.
Digitalized contract management, where every step of the contract lifecycle is taken into consideration, removes essential, and totally unnecessary, part of ”schlepp” in your business processes. It is important in a ”Normal World” but a must have in the ”New Normal.” No matter what it will look like.
Petri Hollmén is a co-founder and CEO of Lyyti Oy, dad of 3, husband, blogger at perjantaikokki.fi, Influencer of the Year in events and the National Entrepreneur Award winner in 2018.
Lyyti is the leading Event Management Software in the Nordics with over 1,000 customers and 75,000 events using Lyyti annually.
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