Taking Advantage of Data With Intelligent Agreements

One revolution brought to companies by digital transformation is the ability to take advantage of data. But are companies really benefiting from all the data available? 

We've heard from many companies about the pain from managing their business relationships well: crucial deals slipping yet another quarter; potential customers experiencing poorly designed signup processes; and losing money because their vendors aren't delivering everything they promised in their contracts. As these problems add up, they cost businesses time, money, and opportunity. A significant amount of data needed to streamline and solve the pain is trapped inside agreements. 

Although the effectiveness of data analytics is undisputable, agreements are a key source of valuable information that companies are not fully leveraging. They are the foundation of any business. The relationships with your customers, your vendors, and your employees are all based on agreements. If you manage your agreements well, chances are you’ll be able to operate efficiently and grow your business quickly. On the contrary, if you manage them poorly, chances are you are leaving a lot of time and money on the table.

A new study conducted by Deloitte in collaboration with DocuSign found that poor agreement management costs companies nearly US$2 trillion in lost economic value annually. The findings of this new report are the result of a series of qualitative interviews and a survey conducted with more than 1,000 leaders from companies of all sizes, multiple development levels and from virtually all sectors in more than 10 countries, including Mexico and Brazil from Latin America. The main goal of this was to identify and understand at a deeper and more realistic level the different challenges, and their main causes, companies face when managing their agreements.

The new research validates what we’ve intuitively known: It’s too hard to manage agreements with traditional or existing tools and processes that are mostly disconnected from other smart managing systems, and that difficulty is weighing companies down. The main reasons are ineffective management, which in turn translates into decreased productivity and lost revenue opportunities.

Among the main factors that make it difficult to manage agreements correctly are processes with manual or outdated workflows, and processes that are uncoordinated (disconnected) from other business management systems, tools, or solutions. Fifty-four percent of respondents stated that they manually enter agreement data into the system; while some have processes so long that they involve up to 15 internal exchanges before any negotiation with the counterpart, wasting up to two hours per deal waiting.

In addition, solutions that do not integrate with core business systems result in 18% more wasted time than those with intelligent tools. In total, such inefficiencies translate into 55 billion hours lost globally each year and an economic value destruction of approximately US$1.7 trillion.

Even worse, delays in the process to complete agreements result in lost revenue opportunities due to delays in activities such as hiring, closing deals, or result in the cancellation of quotas. The study found that 67% of the productivity losses are due to governance — primarily for lack of well-defined roles — and wait times, such as delays in reviews and approvals. This negative impact to productivity represents losses equivalent to US$1 trillion, while lost revenue opportunities total US$800 billion in economic value destruction.

Despite these complications, and although only 36% of the survey respondents reported the use of smart agreement analysis tools, it is clear that companies have begun to realize the importance of intelligent and efficient management of their agreements. 

Until now, completed agreements largely remained as unstructured, flat, and disconnected files that can’t be easily located, searched, or connected to the systems and people who run your business. Managing agreements correctly means companies could extract crucial information and proactively control the potential risks related to them, but many organizations struggle to manage agreements in the right way.

From learning what makes agreement processes get stuck, Docusign designed a new IAM (Intelligent Agreement Management) platform to unleash the power of agreements, transforming a business process bottleneck into a catalyst for growth, innovation, and efficiency.

Just as Customer Relationship Management (CRM), Human Capital Management (HCM), and Enterprise Resource Planning (ERP) leveraged the internet to modernize sales, HR, and resource management, the Intelligent Agreement Management (IAM) category will transform the agreement management process and how agreement data informs every part of your business.

As part of a new wave of revolution of digital transformation, modernizing agreement workflows can help make every step of the agreement process smarter for organizations, accelerating revenue, reducing risk, and unlocking value. 

In this quest, companies must find a valuable intelligent agreement management provider, who must serve their customers with robust, modern, flexible, easy-to-integrate solutions, driven by the latest technology — powered by artificial intelligence — to meet market needs and bring to life the extraordinary potential hidden in agreements.