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Salesforce Contracts: Bad for Contract Management Workflow

Salesforce Contract Management: A Bad Solution for Businesses  | Exari
Salesforce Contract Management: A Bad Solution for Businesses  | Exari

December 13, 2017 Dahna Ori Contract Management  

Why Salesforce is a Bad Choice for Contract Lifecycle Management

Companies make enormous investments in CRM and enterprise systems. So, it’s only natural that they would look to stretch their investment by using those systems for as many functions as possible. The more you use it, the higher the ROI.

Let’s take Salesforce as an example. Salesforce is a wonderful CRM system used by over 100,000 companies and named by Fortune as the most admired computer software company — we use it ourselves here at Exari. It can be instrumental for salespeople in managing leads and contacts. It can be essential for administrators and marketing professionals. But by asking the question, “What is Salesforce used for?” it’s easy to see that it is not the best platform to address a business’s contract lifecycle management needs.

Why Salesforce Falls Short

Contracts are not static documents. Most require management, as key provisions of the contracts need monitoring to ensure that both parties are adhering to their end of the agreement. Without a robust contract lifecycle management solution in place, it’s possible that key milestones will be missed, and the company could fall out of compliance. Using Salesforce for some contract management capabilities may work for those companies that need only base level contract management to support a straightforward and limited contract portfolio. If, however, you require robust contract lifecycle management functionalities (such as negotiation tools, complex data analysis and reporting, and total integration with existing ERP systems) or if you’re planning to scale your company, you’ll have to look beyond the Salesforce contracts management software. According to many companies we’ve spoken with, Salesforce often proves unable to address a high volume or complex contract needs.

For one, using Salesforce contracts management means that all of your contracts must live in the cloud. Particularly now, with experts saying that maintaining cloud-based data storage means greater exposure to cyberthreats, it’s vital that corporations have the ability to choose where to keep their contract portfolio. After all, not all clouds are created equal, and a full 90 percent of respondents in one survey conducted by the Ponemon Institute believe that the marked increase in cloud adoption is going to create a subsequent increase in data breaches.

Furthermore, while Salesforce may be fine for storing sales contracts, your contract portfolio contains a wide variety of other contracts that contain a wealth of sensitive information, which, you more likely do not want every salesperson to be able to access, especially given that a growing number of data breaches begin internally. Using Salesforce as your sales contract database often requires you to use another, more secure database for sensitive contracts in order to comply with certain client obligations, industry regulations, and best practices regarding delicate material.

Unfortunately, dividing your contract management database by levels of access and security inevitably leads to oversights and complications, not least of which is your inability to holistically track and analyze your contracts. In other words, conducting analysis of your contracts to evaluate the level of risk in your portfolio and the value of your contracts becomes virtually impossible without spending a great deal of time compiling and massaging the data.

Increasing Legal’s Workload

Salesforce was designed to be a customer-relationship manager. Contract management was added as an afterthought, but this creates a confusing and inconsistent space in which to do anything not related to CRM. Expecting Salesforce to offer robust contract management capabilities is unrealistic. Therefore, most attorneys don’t feel as comfortable as salespeople do working within the platform as a contract lifecycle management tool.

Considering that in many companies, contracting is viewed as “lawyer’s work,” it’s important to consider their needs and requirements when selecting a contract management solution and initially considering what is Salesforce used for. Lawyers like working with their preferred programs, whether that be Microsoft Word or some other application. Companies using Salesforce for contract management complain of poor adoption by attorneys, who often continue to use their own tools regardless of company policy. Poor adoption leads to lack of consistency, inadequate knowledge sharing and, potentially, rogue contracting, which leaves you exposed to a multitude of unknown risks. Not to mention, this leads to an inefficient contract requesting process, creating delays and bottlenecks in the process, since your attorneys are effectively “reinventing the wheel” every time a contract needs to be drafted.

Some CM providers, such as Selectica (now part of the Determine platform) and Apttus, bring improved CM capabilities to Salesforce. These solutions are built directly into, thus requiring users to pay for Salesforce licenses, which are both expensive and limiting. Salesforce recently revealed that some customers are paying over $1 million per year in licensing fees, which can run up to $3,000 per user annually. Not only is the cost of Salesforces contracts management tool prohibitive to many companies, the very idea of being inextricably tied to Salesforce in this way can turn into a major problem down the road when Salesforce contracts management capabilities prove unable to scale alongside your company.

Indeed, Salesforce is far from state-of-the-art when it comes to its contract management capabilities, lacking meaningfully robust workflow, reporting and search functionalities. Simply put, in the event that you want to grow your business during an IPO, merger and acquisition, or new partnership, gathering the necessary contracts for review is going to be a less organized process that takes more time than it should. So what should companies that have already invested in Salesforce do?

The best solution for many companies is to keep the salespeople where they want to be (Salesforce) and the lawyers where they want to be (a dedicated, lawyer-centric CLM system). With Exari, Sales can work in Salesforce while Legal can keep using Word (or whatever program they’re comfortable with) to draft and negotiate contracts.

Exari allows documents to be stored in the cloud or on-premises and integrates fully with Salesforce without requiring users to subscribe, improving security and saving money. We offer a more robust permission protection system, so that access to your sensitive documents remains restricted. A solution with advanced contract lifecycle management capabilities is the only option for companies with ever-growing and highly complex contract portfolios, and ours are second to none.

To learn more about how Exari Contracts™ may just be the best solution for your CLM needs, contact us today and try our demo.


Dahna Ori is Exari’s Digital Marketing Specialist. Reach out on twitter @ExariDahna