Suppose your company’s wrapping up a big deal, the kind that can really boost profits & open up new chances.

Who makes sure everything runs like clockwork? It’s the contract manager! They handle everything from talks to making sure rules are followed—every "if" is thought out.

This job doesn’t just protect contracts; it protects the whole business!

Thinking about taking on this kind of responsibility? Let’s dig into what it takes to be a great contract manager—and why this job is super important in any company.

What do Contract managers do?

What do you do when there’s a new partnership in place? You ring up a contract manager. That’s what they do. They handle all things of a contract, including drafting, reviewing, negotiating, and implementing it. 

Ultimately, this means that they are directly responsible for reducing risks, ensuring that contracts align with business goals, and keeping disputes at bay.

The significance of contract management in different industries

You can’t do without managing contracts. And by that, I don’t mean just reviewing documents; it’s about aligning every agreement with your company’s goals while reducing risk.

Also read: Why Contract Management Is Important

Construction: When it comes to construction where there are multiple stakeholders, tight timelines—things can get complicated quickly. You need contract management here more than anywhere to make sure commitments are met and disputes don’t arise.

‍Technology: You can’t sell technology without contracts. They exist everywhere fdrom licensing to SLAs. That’s why contract management is a no-brainer here because you need to safeguard your company’s intellectual property (IP) and prevent risks.

Legal: For those in the legal sector, contract management is about more than just compliance. There’s contract obligations, deadline tracking, and ensuring everything is exactly where it should be. So, you need someone who can ensure nothing slips through the cracks.

Saas: In SaaS, contracts handle everything—subscriptions, renewals, upgrades, and cancellations. Since services are delivered continuously, you’re dealing with renewals, upgrades, and sometimes, cancellations. Proper contract management ensures you keep track of these moving parts, avoiding revenue leakage and staying on top of customer obligations. Plus, you’ve got to be sure your terms evolve with your product, protecting your business while keeping customers happy.

Also read: The Co-Pilot for Legal Teams

Skills and qualifications required for a contract manager

There’s more than just contracting skills that you need to be successful at your job as a contract manager. Here is a list of those skills.

Essential skills for a contract manager:

• Negotiator

As a contract manager, you will often be negotiating contracts to get the best deal for your org. So if you’re not good at this, you have no business being in this field.

• Observant

Contracts means fine print. One small detail, or even so much as a word missed, and you’re paying millions. Unless you love reading even the minutest and the most boring stuff, you don’t want to be a contract manager.

• Communicator

You’ll be talking to people all the time, explaining contract terms or negotiating with external partners. So you need to be able to communicate clearly while building relationships with those people.

• Problem-solver

Things will not always go as planned. You’ll need to think on your feet and come up with solutions to ensure everything is shipped on time and blockers are eliminated.

• Knows legal terminology

While you don’t need to be a lawyer, you must have legal terms at the back of your hand, because without those, you can’t understand contracts. 

• Project manager

Managing contracts is a lot like managing a project. You’ll need to keep everything organized and ensure deadlines are met.

• Financially literate

Contracts often deal with things like budgeting, cost analysis, or managing financial risks. So, it’s key to have a solid grasp of the numbers.

Qualifications of a contract manager:

• Relevant educational background: Having a degree in something like law, business administration, or supply chain management can give you a solid foundation to build on.
• Certification programs: If you want to stand out, certifications like the Certified Professional Contract Manager (CPCM) can give you that extra edge and show you’re serious about your career.
• Experience in related fields: Experience in areas like procurement, legal, or project management can be a big plus. It gives you practical insights and skills that are directly transferable to contract management.

Also read: Top 10 Contract Management Skills to Master in 2023

Responsibilities of a contract manager

Being a contract manager is kind of like being the conductor of a very complicated orchestra—except instead of music, you're dealing with agreements and deals. That sounds nice and all but things are not always as they seem. There are also some very difficult hurdles that go along with that. Let's dive into a few of the big ones:

#1 Getting the details right

Whenever a contract is in the process of being drafted or reviewed, its details have to be very stringent. You would want its language to be crystal clear so that there are no surprises in the future, just like writing some guidebook where people know how to follow through with things. 

You will also make sure everything is placed on very solid legal ground so that your organization is in a good position and nobody gets themselves hitched into some stickily troublesome situations later on.

#2 Finding common ground

You are bringing all people together by the negotiation terms. It is not just your side; it's all about finding something that can work for all parties. You balance the needs of your organization with what the other party is looking for. It may mean determining the right price, adjusting timelines, or working out specifics.

Also read: Revolutionizing Contract Review with AI and Manual Validation

#3 Keeping the contract on track

This means that the moment the contract is signed, you are liable to ensure that all of the things that are agreed upon transpire. You are there from the very beginning until the very end: checking if the deadlines are being met, if everyone is doing their job, and jumping in if one thing goes awry. You are something of a guide who sees it through that the whole process goes right, smoothly—from step A to Z.

#4 Staying ahead of risks

The whole role of being a contract manager is to avoid bumps in the road. Always checking to see if people are abiding by all the rules laid out in the contract, and stepping in before any problems become giant issues. It's all about being proactive—catching the potential risks early, so they don't turn into headaches later.

#5 Keeping everything in order

A huge part of the job is organizing all your contracts and documents. You want to be able to find any piece of information in an instant, should it be needed. Good organization saves time in work and ensures that decisions are based on clear-cut, available information.

#6 Working with the whole team

You are not working in isolation; you team up with folks from other departments such as legal, finance, procurement, and others to make the contract terms fit with the greater picture of what the organization is trying to achieve. It is all about collaborating in making sure the contracts that one manages support the goals of the organization while keeping things legally and financially appropriate.

Challenges faced by contract managers

Being a contract manager isn’t all about getting agreements signed and tucked away in a drawer. It comes with its fair share of hurdles that can make the job feel like juggling flaming torches while riding a unicycle. Curious about what those challenges look like? Let’s dive in!

#1 Handling complex negotiations

It's not enough to just get everyone to agree and sign a contract. It’s about making sure everyone feels good about the deal without anyone walking away feeling like they got the short end of the stick.

Imagine you’re working for a big tech company. One day, you’re dealing with complex licensing agreements. Different teams have different needs—engineering wants one thing, sales needs another, and legal has its own concerns. Your mission? So make everyone happy but without compromising the interest of your company. It's kind of like being the referee in a game and everyone wants to win, but it's your job to see that they all do!

#2 Keeping up with regulatory changes

All the rules and laws and whatnot are constantly changing, and something that was perfectly fine yesterday is completely taboo today. And staying in tuned with these updates is a big part of the job.

Take the healthcare or finance sectors, for example. It seems like new laws and statutes just appear one day out of nowhere, and then all of a sudden you have to go back and check every contract you have ever touched to be sure that they still comply with these changes. It can feel like you’re constantly rearranging puzzle pieces to fit a new picture, but staying on top of these shifts is critical to avoid landing in any hot water legally or financially.

#3 Managing multiple contracts

Contract managers are always juggling dozens or contracts at one time, and each contract has its own set of deadlines and terms and little peculiarities. It’s a lot to juggle!

Picture a contract manager at a construction company. They have subcontracts, supply agreements, and client contracts all tied up together. Every contract has to coincide with the master schedule and budget. It’s like trying to keep several plates spinning in the airdrop one, and the whole show could come crashing down.

Also read: Sending out Multiple Contracts with SpotDraft Campaigns

Tips for contract managers

#1 Communicate effectively to keep stakeholders aligned

“Naturally, having a transparent and collaborative communication process in the early stages is crucial. It can enable legal teams to be the facilitator of commerce - bring about a cohesive understanding of what is actually deliverable and align sales strategies with that understanding, while also helping the teams focused on service delivery by providing them with knowledge on what is expected of them by other business functions (which may not have been directly communicated).”
~ Harry Borovick, Senior Legal Counsel, LiveRamp
SpotDraft Counsel Corner: Starting Right, as an In-house Professional

Clear communication is crucial in contract management. You need to set expectations with stakeholders early on and provide regular updates to keep everyone informed. Use simple language to avoid any misunderstandings.

Tools like email templates and project management software can help streamline your communication. In fact, 74% of recruiters believe that proficiency in these tools is a key skill for job candidates.

#2 Continuously learn to stay ahead of industry trends and legal changes

Staying updated on industry trends and legal changes is essential. Subscribe to legal newsletters, join webinars, and take relevant courses. This helps you stay informed about any changes that could impact your contracts.

#3 Build strong relationships with clients and vendors

Building and maintaining strong relationships with clients and vendors is key to successful contract management. Be responsive and transparent in your interactions. Regular check-ins can help maintain trust.

#4 Manage your time effectively by prioritizing tasks and using tools

“The simplest thing that technology can do for in-house lawyers is to help bring accountability and visibility into the work they do. Since their work is unlike that of other business teams, there is often a lack of understanding regarding where lawyers spend their time and conversely on what value they bring to the table.”
‍~ Harry Borovick, Senior Legal Counsel, LiveRamp
SpotDraft Counsel Corner: Starting Right, as an In-house Professional

Time management is critical when handling multiple contracts and deadlines. Prioritize your tasks based on urgency and importance. Use calendars or task management apps to keep track of deadlines and responsibilities.

A day in the life of a contract manager

• Starting with a morning check-in: The day kicks off with a detailed review of ongoing contracts. The contract manager checks for any upcoming renewals, ensures deadlines are on track, and sets their priorities for the day.
• Collaborating with the team: Morning meetings are essential. The contract manager meets with internal stakeholders to discuss contract requirements and alignment. They also spend time negotiating terms with external partners to secure favorable agreements.
• Focusing on document accuracy: In the afternoon, the contract manager dives into reviewing contractual documents. Ensuring every detail is accurate and compliant is crucial, and they often collaborate with the legal department to handle complex issues.
• Addressing industry-specific needs: For those in specialized fields like construction or IT, additional time is spent on understanding and managing industry-specific contractual provisions and regulations, making sure all contracts meet these unique requirements.

How can contract management software help?

Contract management software can make your daily work much easier. It helps by taking care of repetitive tasks, keeping everything organized, and making sure you stay compliant. Here’s how it works:

• Automation of repetitive tasks: The software takes over the routine tasks like drafting contracts, storing them, and keeping track of deadlines. This saves you time and reduces the chances of mistakes.

Also read: End-to-end contract automation software for legal teams

• Improved accuracy and compliance: You don’t have to worry as much about errors. The software has built-in compliance checks that ensure your contracts meet legal requirements.

Also read: SpotDraft Reduces Risk For Legal Teams While Enhancing Accuracy

• Centralized document management: All your contracts are stored in one place, making it easy to find and manage them. You always have the most up-to-date version at your fingertips.

Also read: Organize your contracts in a searchable repository

• Risk management and reporting: The software helps you spot potential risks early by generating reports on any issues. This way, you can address problems before they get out of hand.

How SpotDraft helps contract managers

SpotDraft is a leading contract management software designed to simplify and streamline the entire contract lifecycle. It’s built to help legal teams and contract managers automate their workflows, ensuring that contracts are handled efficiently and with minimal risk.

Key features

SpotDraft offers a range of powerful features, including:

• Automated contract drafting: SpotDraft automates the creation of contracts, reducing the time spent on manual drafting and minimizing errors
• AI-powered insights: The software provides AI-driven insights, helping you make informed decisions by analyzing contract data

Also read: Smarter Contract Management with SpotDraft AI

• Seamless integrations: SpotDraft integrates smoothly with tools you already use, such as CRM systems and communication platforms, making it easy to incorporate into your existing workflow

Also read: CLM integrations for efficient teams - SpotDraft

SpotDraft also provides valuable career information and resources for aspiring contract managers. These resources can help you stay updated on industry trends, develop your skills, and advance your career.