Contract Lifecycle Management (CLM) is the process of managing a contract from inception through execution and eventual renewal or expiry, ensuring that every stage is controlled, visible, and optimised.
In essence, CLM isn’t just about storing contracts; it’s about orchestrating the full flow - from creation, negotiation, and approval, to execution, obligation tracking, renewal, and analysis.
By adopting CLM best practices (and often a supporting CLM tool), organisations can reduce risk, accelerate processes, enhance compliance and accountability, and ultimately unlock greater value from their contracts.
The contract lifecycle typically consists of six core stages that ensure contracts are properly created, executed, and managed. The first three steps occur before signing (pre-signature), and the remaining three occur after signing (post-signature).
These stages focus on everything that happens before a contract is signed - the foundation of a strong, compliant, and effective agreement.
This stage begins with drafting, triggered by a request, renewal, amendment, or new deal. It involves capturing essential terms like parties, dates, obligations, pricing, milestones, and contingencies.
Challenge: Starting from scratch often leads to inconsistent language, hidden risks, and inefficiencies. Standard templates or clause libraries can help ensure consistency and reduce drafting time.
Once drafted, the contract enters a negotiation phase involving multiple stakeholders. This is where redlining, version control, and collaborative reviews happen.
Pain Point: Relying on email or shared Word files often causes version chaos and slows turnaround. CLM tools streamline this by providing shared workspaces and automated change tracking.
Before signing, contracts go through internal reviews and approval workflows involving legal, finance, and operations. This stage often becomes a bottleneck due to manual routing.
Solution: A CLM system automates routing, tracks pending approvals, and ensures transparency across the approval pipeline.
Once a contract is signed, the focus shifts to execution, performance management, and continuous optimisation, ensuring that obligations are met and value is realised.
After approval, contracts move into execution - often via e-signatures today. The signed version is stored in a secure, centralised repository with proper access controls.
Benefit: CLM tools ensure only the final version is accessible, signatures are tracked, and audit trails are maintained.
Once active, contracts enter their operational phase. This involves monitoring deliverables, compliance, obligations, and key milestones throughout the contract’s term.
Why it matters: Without ongoing management, missed deadlines or unnoticed obligations can create legal or financial exposure.
How CLM helps: Automated alerts, obligation tracking, and dashboards make it easier to stay on top of day-to-day performance.
The final stage focuses on evaluating outcomes and planning next steps. CLM systems analyse contract data, renewal rates, performance metrics, and risk indicators, to support data-driven decision-making.
This is also where renewal or extension opportunities are identified and acted upon.
Note: Different CLM frameworks handle the Renewal step differently depending on how they define “lifecycle end.”
Outcome: With strong analytics and renewal workflows, organisations can continuously improve efficiency and maximise contract value.
Contracts define every critical business relationship - suppliers, customers, employees, and partners. Mismanaging them can lead to compliance issues, missed revenue, or legal exposure. Here’s why CLM is essential in modern organisations:
Modern Contract Lifecycle Management platforms go far beyond simple storage or reminder systems. The best CLM solutions blend automation, intelligence, and collaboration to create a connected and efficient contracting process.
A strong CLM tool streamlines workflows and approvals across departments, supports template and clause libraries for consistent drafting, and maintains version control with redlining for clear negotiation tracking. Integrated e-signature capabilities ensure fast, secure execution and audit-ready records.
Once contracts are active, automated alerts and obligation tracking prevent missed deadlines, while a centralised, searchable repository provides secure access and transparency. Built-in reporting and analytics turn contract data into actionable insights on performance, risk, and renewals.
Finally, AI and advanced automation elevate CLM to a strategic level - analysing clauses, flagging risks, summarising key terms, and even predicting renewals. In short, modern CLM tools transform contract management from a manual process into a powerful driver of business intelligence.
Contract Lifecycle Management is no longer just a back-office task - it’s a strategic necessity. By streamlining pre-signature stages (creation, negotiation, approval) and strengthening post-signature processes (execution, management, reporting), CLM empowers organisations to turn contracts from static documents into dynamic business assets.
This blog sets the foundation for our upcoming series, where we’ll dive deeper into each stage - exploring creation best practices, negotiation workflows, approval automation, contract analytics, and more. Stay tuned as we unpack each phase in detail to help you build a CLM strategy that truly works.
Your dedicated solution for efficient Contract Management.